Opinion
Civil Action No. 1:98-CV-200-M
February 9, 1999.
MEMORANDUM OPINION AND ORDER
This matter is before the Court upon the Plaintiff's motion to remand this case for lack of diversity.[DN 7] The Defendant claims that the non-diverse defendants are fraudulently joined. The issue relates to whether an individual can be held liable under KRS Chapter 344. The matter has been briefed and is ripe for a decision.
The Defendants' argument is that this issue has been laid to rest by the decision in Wathen v. General Electric Co., 115 F.3d 400 (6th Cir. 1997). However, the Court does not read the Wathen decision as broadly as the Defendants do.
In Wathen, the court was concerned with the definition of "employer" as found in 42 U.S.C. § 2000e(b), which is similar to that used in KRS 344.030(2) in that it includes as an employer "an agent of such a person." KRS 344.040 prohibits discrimination by an "employer." The argument had always been that an individual employee was an agent of the employer and thus, qualified as an "employer" under the statute. Wathen clearly forecloses the argument that individual employees qualify as "employers" under the statute. The court in Wathen looked to the statutory scheme and remedial provisions of Title VII, and concluded that Congress did not intend to impose individual liability on employees since it limited liability to employers with fifteen or more employees, and initially restricted damages to reinstatement and back pay, which only an employer could provide. Even after the enactment of the Civil Rights Act of 1991, compensatory damages were calibrated to the number of persons employed, indicating damages are to be paid only by employers. Furthermore, the court noted that "[t]he statute contains no provision for damages to be paid by individuals, further evidencing a lack of congressional intent to hold individuals liable." Id. at 406.
However, Wathen does not address the issue which is before this Court. The Plaintiff's claim under KRS 344.280 does not depend on the Defendants' being considered "employers" as that term is defined and used under the statute. KRS 344.280 uses the term "person" while its counterpart under Title VII, 42 U.S.C. § 2000e-3(a), uses the term "employer." The Wathen court never considered the use of the word "person" as used in KRS 344.280.
The Plaintiff's claim is a conspiracy claim under KRS 344.280 which declares it to be an unlawful practice for any person, or for two or more persons, to conspire, to retaliate or discriminate in any manner against a person who has opposed a practice declared unlawful by the Kentucky Civil Rights Act. This language evidences an intent on the part of the Kentucky General Assembly to hold "any person" or "two or more persons" liable for such conduct. A person is defined under KRS 344.010(1) to include one or more individuals. KRS 344.990 makes a willful violation of KRS 344.280 a misdemeanor. However, the Kentucky Supreme Court in Palmer v. International Ass'n of Machinists, Ky., 882 S.W.2d 117 (1994), held that despite KRS 344.990, the plaintiff did "have a cause of action against two individuals who, in alleged violation of KRS 344.280, conspired to retaliate or discriminate in any manner against a person who had filed a sexual discrimination lawsuit." Id. at 120. The Supreme Court noted that KRS 344.450 provides a recovery in a civil action for any person injured by any act in violation of the provisions of the Kentucky Civil Rights Act. There is nothing in the remedial provisions of the Kentucky Civil Rights Act to suggest only employers are liable, as there is under Title VII.
The Court believes Wathen is clear in its holding that individuals do not face liability under the definition of "employer" under Title VII and KRS Chapter 344. The Court also believes that Plaintiff's claim that individuals can be liable under KRS 342.197 is not well-founded. However, the Court, based on its review of Wathen and Palmer, agrees with Plaintiff that it is possible that a Kentucky court could reasonably find that "persons" are liable under the provisions of KRS 344.280.
The Defendants disagree and cite Stacy v. Shoney's, Inc., 142 F.3d 436, 1998 WL 165139 (6th Cir. March 31, 1998), and Pinelo v. Northern Kentucky University, 142 F.3d 435, 1998 WL 165136 (6th Cir. March 31, 1998), for the proposition that individual liability may not be imposed for a retaliation claim brought under KRS 344.280. The Court finds these cases unpersuasive and concludes that the Sixth Circuit has not specifically addressed this issue.
In Stacy v. Shoney's, Inc., 142 F.3d 436, 1998 WL 165139, the plaintiff filed suit against Shoney's and an individual employee/supervisor for a violation of the Kentucky Civil Rights Act. The Sixth Circuit relying on its decision in Wathen, 115 F.3d 400, held that the employee/supervisor was not an "employer" and therefore could not be personally liable for a violation of KRS 344.040. The Sixth Circuit also rejected plaintiff's argument that the employee/supervisor was still individually liable under the Kentucky Civil Rights Act pursuant to KRS 344.280 finding that the plaintiff failed to allege any retaliation in the complaint or present any evidence of retaliation. Id. at *2. It appears to the Court that the Sixth Circuit in Stacy impliedly acknowledged that a person may be individually liable under KRS 344.280 if the violation is properly pled and evidence exists to support the claim. In the present case, the Court finds that Plaintiff's complaint more than adequately meets the notice pleading standard for filing a complaint under the Kentucky Rules of Civil Procedure. And at this juncture, the Court need not assess the evidence in the record.
In Pinelo v. Northern Kentucky University, 142 F.3d 435, 1998 WL 165136, the plaintiff filed suit against Northern Kentucky University and a number of individuals alleging, among other things, "unlawful retaliation under Title VII and its Kentucky statutory counterpart." Id. *1. The Sixth Circuit summarily dismissed Pinelo's claims against the individual defendants under Title VII and KRS Chapter 344 stating:
Since the amended complaint in this case was filed, this court has held that individuals who do not act as employers are not personally liable under Title VII or the Kentucky Civil Rights Act. Wathen, 115 F.3d at 403-406. Thus, we affirm the grant of summary judgment to the individual defendants on all claims brought pursuant to these statutes.Id. at * 2.
The Court does not believe that Pinelo addressed whether individual liability under KRS 344.280 is permitted. The Sixth Circuit in Pinelo never mentioned KRS 344.280, the word "conspire," or defined "person" within the meaning of the statute. Furthermore, as discussed above, reliance on Wathen for the holding that all individual liability claims brought under any provision of Chapter 344 are barred is overbroad. Wathen addressed only whether individuals are subject to liability under the definition of "employer" under Title VII and KRS Chapter 344.
Assuming for the sake of argument that Pinelo does prohibit individual liability under any provision of Chapter 344, this Court would be bound by that decision; however, a Kentucky court would not. After a review of Wathen, Stacy, Pinelo, and the statute and definitions in question, the Court is of the opinion that there is a reasonable basis to believe that a Kentucky court could impose liability on the individual defendants under KRS 344.280.
For the reasons set forth above, the Court finds that the individual defendants are not fraudulently joined. The Court being otherwise sufficiently advised, IT IS HEREBY ORDERED that the motion by Plaintiffs to remand the case to the Warren Circuit Court [DN 7] is granted.