Stolarik v. N.Y. Times Co.
Stolarik v. N.Y. Times Co.
Opinion of the Court
*529Plaintiff Robert Stolarik - a photographer who formerly worked for The New York Times - brings this action against The New York Times (the "Times"), Michelle McNally - the Assistant Managing Editor for Photography at the Times - and the Trustees of the Newspaper Guild of New York-New York Times Pension Plan, the Newspaper Guild of New York-New York Times Pension Plan, the Guild-Times Adjustable Pension Plan, and the Trustees of the Guild-Times Adjustable Pension Plan (collectively, the "Plan Defendants"), alleging that the Times improperly classified him as a freelance photographer and independent contractor and discriminated against him on the basis of age and arrest record. (Am. Cmplt. (Dkt. No. 21) ¶¶ 1, 5-10, 26, 44)
The Amended Complaint asserts claims for failure to pay overtime compensation in violation of the Fair Labor Standards Act (the "FLSA") and New York Labor Law (the "NYLL"); failure to pay Plaintiff the "agreed-to wages and benefits for a staff photographer of [t]he Times set forth in the governing collective bargaining agreement" in violation of Article 6 of NYLL § 190; discrimination based on age and arrest record, and retaliation in violation of the New York City Human Rights Law (the "NYCHRL"); breach of quasi-contract arising out of the Times' failure to pay Plaintiff "a salary equivalent to that of staff photographers at [t]he Times;" and denial of benefits pursuant to the Employment Retirement Income Security Act ("ERISA") § 502(a)(1)(B). (Id. ¶¶ 144-191)
The Times has moved to dismiss the Amended Complaint's Third and Tenth Causes of Action, which allege claims for unpaid wages pursuant to Article 6 of NYLL § 190 and unjust enrichment. (Times Mot. (Dkt. No. 42) ) Because these claims are predicated on rights created by the collective bargaining agreement ("CBA"), the Times argues that they are preempted by Section 301 of the Labor Management Relations Act (the "LMRA"),
The Plan Defendants have moved to dismiss the Amended Complaint's Eleventh Cause of Action for benefits under Section 502(a)(1)(B) of ERISA. (Plan Mot. (Dkt. No. 47) ) The Plan Defendants contend that (1) Plaintiff's claim for benefits is barred by the applicable six-year statute of limitations; and (2) in the alternative, the Trustees' conclusion that Plaintiff is not eligible for benefits was not arbitrary and capricious. (Plan Br. (Dkt. No. 48) )
For the reasons stated below, the Times' motion to dismiss will be granted. The Plan Defendants' motion to dismiss will be converted into a motion for summary judgment, and that motion will be granted,
BACKGROUND
I. CLASSIFICATION AS AN INDEPENDENT CONTRACTOR
Plaintiff Robert Stolarik is a 48-year-old photographer who worked for the Times for more than fourteen years. (Am. Cmplt.
*530(Dkt. No. 21) ¶ 17) Plaintiff first began working for the Times as a freelance war zone photographer in Colombia in or about 2000. (Id. ¶ 18) He continued working for the Times in Colombia and Venezuela until June 2002, when he returned to the United States. (Id. ) After a brief hiatus, Plaintiff resumed work for the Times in 2004, and was assigned to the Metro desk. (Id. ¶ 20)
Between 2004 and 2012, Plaintiff worked full-time for the Times, generally on assignment for more than 250 days per year, He often worked more than eight hours a day and 40 hours per week. (Id. ¶¶ 22, 30) Plaintiff sometimes worked twenty-eight or more consecutive days for the Times during this period. (Id. ¶ 23) After 2012, the number of Plaintiff's assignments for the Times gradually diminished. (Id. ¶¶ 25, 30)
Plaintiff alleges that despite his "hard work, his full-time schedule, and his enormous success, he was always improperly classified by [t]he Times as a 'freelance' photographer who received no benefits and was paid via IRS Form 1099-MISC." (Id. ¶¶ 28, 40) As a result, Plaintiff "incur [red] additional tax expenses and liabilities while [t]he Times saved money that [it was] legally obligated to pay." (Id. ¶ 29) Plaintiff claims that the Times misclassified him as an independent contractor in order to avoid the cost of providing him full wages, overtime pay, and employee benefits. (Id. ¶¶ 29, 41)
Plaintiff contends that - despite his classification as an independent contractor - he was a Times employee, (Id. ¶ 40) He cites the following facts and circumstances in support of his claim:
he worked on a continuous basis for the Times, rather than on a temporary basis;
he received assignments directly from Times editors, "in the same manner as staff photographers classified as employees of the Times";
he "performed services identical to people whom defendants treated as employees," and the services he performed were of the kind that employees historically performed in photographic journalism;
the Times exercised a high degree of control over his work, providing detailed instructions and dictating his assignments and hours worked;
the Times sometimes loaned equipment to Plaintiff "from stock of equipment designated for Times staff photographers";
the Times "had discretion over when and how long [he] worked";
the type of work Plaintiff performed was integral to the regular business of the Times; and
Plaintiff could not realize profits and losses independent from the Times, and he depended upon the regular payments he received from the Times for his income.
(Id. ¶¶ 35-40)
Plaintiff asserts two causes of action against the Times related to its alleged misclassification of him as an independent contractor. (See
In the Third Cause of Action, Plaintiff asserts a claim for unpaid wages pursuant to Article 6 of the NYLL, § 190 et seq. (Id. ¶¶ 157-62) Plaintiff alleges that "[f]rom approximately 2004 to 2014, [the Times] knowingly employed Plaintiff as a staff photographer", yet the Times "failed to pay Plaintiff the agreed-to wages and benefits for a staff photographer of the Times." (Id. ¶ 60) "[B]y paying Plaintiff approximately $25 per hour instead of the salary set forth in the governing collective bargaining agreement of approximately $100,000 per year[,] and by not providing [Plaintiff] with the benefits of a staff photographer," Plaintiff claims that the Times *531"unlawfully deducted from [his] wages" in violation of Article 6 of the NYLL § 190, et. seq. (Id. ) Plaintiff further alleges that the Times' "failure to pay Plaintiff the agreed-to wage for the time he worked ... was willful and not in good faith, and a breach of implied contract." (Id. ¶ 161)
In the Tenth Cause of Action, Plaintiff asserts a claim for unjust enrichment. (See
II. DENIAL OF BENEFITS
A. Plaintiff's Freelance Agreement with the Times
On April 2, 2004, Plaintiff entered into a freelance agreement with the Times (the "Freelance Agreement"). (Id. at ¶ 5; Costello Decl., Ex. D (Freelance Agreement) (Dkt. No. 49-4) at 3) The Freelance Agreement states that it is an "agreement between [Plaintiff] and The New York Times Company ("The Times") for freelance photography services [Plaintiff] may be commissioned to provide on assignment to the Newspaper." (Costello Decl., Ex. D (Freelance Agreement) (Dkt. No. 49-4) at 2) The Freelance Agreement provides as follows:
9. You are an independent contractor, and as such you do not receive any benefits as an employee of The Times. The Times will provide you with IRS form 1099 at the end of the year reflecting all amounts paid to you for that year.
10. This letter constitutes the entire agreement between you and The Times regarding your freelance photography services from this date forward, and supersedes all prior agreements on this subject matter. Either party may terminate this agreement upon thirty (30) days written notice to the other. No amendment or waiver shall be valid unless in writing and signed by both you and The Times.
11. This agreement has been made in accordance with New York State laws and will be construed under those laws. Any action to enforce this agreement shall be brought exclusively in the federal or state courts in the City of New York.
(Id. at 3) The last page of the Freelance Agreement bears Plaintiff's signature. (See
B. The Plans
Defendants Newspaper Guild of New York-New York Times Pension Plan (the "Guild Plan") and Defendant Guild-Times Adjustable Pension Plan (the "APP Plan") are employee pension benefit plans jointly *532administered by the Times and the Newspaper Guild of New York (the "Union"). (See Am. Cmplt. (Dkt. No. 21) ¶¶ 8-9, 44; Costello Decl., Ex. B (Guild Plan) (Dkt. No. 49-2) at 10 §§ 1.27, 1.46; Costello Decl., Ex. C (APP Plan) (Dkt. No. 49-3) at 5, 7 §§ 1.29, 1.45) The Guild Plan was established in January 1966, and the APP Plan was established in January 2013. (See Costello Decl., Ex. B (Guild Plan) (Dkt. No. 49-2) at 3; Costello Decl., Ex. C (APP Plan) (Dkt. No, 49-3) at 3) Both Plans provide retirement benefits to Plan "Participants," (See Costello Decl., Ex. B (Guild Plan) (Dkt. No. 49-2) at 3-5; Costello Decl., Ex. C (APP Plan) (Dkt. No. 49-3) at 3)
The Guild Plan defines a "Participant" as "any Employee or Member who is or has been in Covered Employment after; (a) attaining age twenty-one (21) and (b) who has completed one (1) or more years of employment as an Employee or Member, or after: (a) having attained the age of fifty (50) and (b) having completed six (6) months or more of employment as an Employee or Member. Notwithstanding anything herein to the contrary, no individual who was not a Participant on December 31, 2012 shall become a Participant in the Plan." (Costello Decl., Ex. B (The Guild Plan) (Dkt. No. 49-2) at 9 § 1.35)
Member "means an Employee or Participant in one of the bargaining units subject to the Collective Bargaining Agreement or in Foreign Service on whose behalf the Employer makes payments to the Fund pursuant to Article XII. 'Member' also means any Employee or Participant in the employment of the Trustees or the trustees of the Newspaper Guild of New York -The New York Times Benefits Fund." (Id. at 8 § 1.32) Employee is defined as "any person who is in the employment of the Group." (Id. at 7 § 1.20) The "Group" "means the Employer," and the "Employer" "means The New York Times Company for itself and on behalf of The New York Times." (Id. at 7-8 §§ 1.20, 1.28) Finally, "Covered Employment" means "employment of a Member by the Employer in one of the bargaining units subject to the Collective Bargaining Agreement or in Foreign Service. 'Covered Employment' also means employment of a Member by the Trustees or by the Trustees of the Newspaper Guild of New York -The New York Times Benefits Fund." (Id. at 6 § 1.13)
The APP Plan similarly defines a "Participant" as "any Member who has: (a) attained age twenty-one (21) and (b) been credited with 500 Hours of Service in one (1) or more Plan Years as a Member." (Costello Decl., Ex. C (APP Plan) (Dkt. No. 49-3) at 7 § 1.37) "Member," in turn, is defined as "an Employee in one of the bargaining units subject to the Collective Bargaining Agreement or in Foreign Service on whose behalf the Employer makes payments to the Fund pursuant to Article X." (Id. at 6 § 1.34) "Employee" is defined as "any person who is in the employment of the Group," and the "Group" refers to the Times. (Id. at 5 §§ 1.22, 1.23, 1.30) "Covered Employment" "means employment of a Member by the Employer in one of the bargaining units subject to the Collective Bargaining Agreement or in Foreign Service." (Id. at 4 § 1.14)
Both Plans provide that the
Trustees shall have sole and absolute discretion and authority to interpret and construe the terms and provisions of the Plan, to resolve ambiguities, inconsistencies and omissions therein, to make factual findings and other determinations and to issue rulings regarding the rights and benefits of Members and of all other persons having or claiming an interest in the Plan. In the event of a scrivener's error that renders a Plan term inconsistent with the Trustees' intent, the Trustees'
*533intent controls, and any inconsistent Plan term is made expressly subject to this requirement. The Trustees have the authority to review objective evidence to conform the Plan term to be consistent with the Trustees' intent. Each finding, determination and ruling by the Trustees shall be conclusive, final and binding on the Guild and its members, on the Member or Members involved, on the Group and on all parties claiming any interest under the Plan and may not be further contested. Any determination made by the Trustees shall be given deference in the event it is subject to judicial review and shall be overturned only if it is arbitrary and capricious.
(Id. at 8 § 8.6; Costello Decl., Ex. B (Guild Plan) (Dkt. No. 49-2) at 11 § 10.6)
C. Plaintiff's Claim For Benefits
In a July 28, 2016 letter to the Trustees of the Guild Plan and the Trustees of the APP Plan, Plaintiff requested "that the Trustees acknowledge his status as a Participant in both Plans and clarify his right to future pension benefits." (Costello Decl., Ex. E (July 28, 2016 Ltr.) (Dkt. No. 49-5) at 6) In his letter, Plaintiff states that he worked for the Times "for more than a decade as an employee, but was improperly classified as an independent contractor throughout his tenure." (Id. at 2) Plaintiff claims that, "[a]s an employee," "he was eligible to participate in the Plans and ... to receive pension benefits upon reaching retirement." (Id. )
In an affidavit submitted with his letter, Plaintiff states that he received copies of the Guild Plan and the APP Plan "for the first time on May 3, 2016 following a written request for the Plans made by my counsel on April 5, 2016." (Id. at 7; Bantle Aff., Ex. A (Stolarik Aff.) (Dkt. No. 55-1) at 1; see also Costello Decl., Ex. F (April 5, 2016 Letter Requesting Plans) (Dkt. No. 49-6) ) According to Plaintiff, prior to May 3, 2016, he "was unaware that [he] was eligible for pensions under the terms of the Plans," and that "[t]o date, the Trustees of the Plans have not informed me whether or not I am eligible for benefits under the terms of the Plans." (Costello Decl., Ex. E (July 28, 2016 Ltr.) (Dkt. No. 49-5) at 7; Bantle Aff., Ex. A (Stolarik Aff.) (Dkt. No. 55-1) at 1)
After receiving Plaintiff's July 28, 2016 letter, the trustees of the Plans requested that the Times state its "position with respect to Robert Stolarik's claim that he is an employee and in the bargaining unit and set forth the reason for the Times' position." (Costello Decl., Ex. G (Aug. 8, 2016 Ltr. to the Times) (Dkt. No. 49-7) )
In an August 29, 2016 letter, the Times responds that "Mr. Stolarik is not and has never been an employee of the Times, and his claim for benefits should be denied." (Costello Decl., Ex. H (Aug. 29, 2016 Ltr.) (Dkt. No. 49-8) at 2) According to the Times, Plaintiff was an independent contractor throughout his tenure at the Times:
Mr. Stolarik is a freelance photographer who has performed services for the Times (and many others) from time to time over the last fifteen years. At all times, he has performed these services as a freelancer and an independent contractor, as memorialized in the written freelance photography services agreement he signed with the Times in April 2004 (the "Freelance Agreement"). (A copy of Mr. Stolarik's Freelance Agreement is attached as Exhibit A.) As he agreed in his Freelance Agreement with the Times, Mr. Stolarik is "an independent contractor, and as such [he does] not receive any benefits as an employee of the Times." (See Ex. A, par. 9.) Mr. Stolarik accepted a freelance relationship with the Times on these terms, as evidenced by his signature on the Freelance *534Agreement. He provided freelance photography services to the Times for more than a dozen years after signing the Freelance Agreement, without challenging his independent contractor or freelance status or making any claim to the kinds of benefits that the Times provides to its employees, including under the Pension Plans,
(Id. ) The Times also notes that Plaintiff had always held himself out as a freelance photographer and independent contractor; that he operated an independent photography business; and that he has repeatedly asserted in court filings that he is a freelance professional photographer. (Id. at 3)
In a January 24, 2017 letter, Robert Costello - the Plan Administrator for both Plans - notified Plaintiff that his "claims have been denied under the respective Plans." (Costello Decl., Ex. I (Jan. 24, 2017 Ltr.) (Dkt. No. 49-9) at 2) The letter explains that
[u]nder the terms of the Plans, participation is limited to employees of the Times meeting certain eligibility criteria. Non-employees, such as freelancers or independent contractors, are not eligible for participation in the Plans. Specifically, both the Pension Plan and the APP provide that only "Participants" are eligible for benefits under the Plans. For this purpose, "Participant" is defined in relevant part as any employee who is or has been in "Covered Employment" after achieving certain eligibility thresholds related to age and length of service. Covered Employment is defined as "employment of a Member by the Employer in one of the bargaining units subject to the Collective Bargaining Agreement or in Foreign Service." To be a "Member", one must be an Employee in one of the above-described bargaining units or an Employee of the Fund. See Sections 1.13, 1.20, 1.32 and 1.35 of the Pension Plan and Sections 1.14, 1.22, 1.34 and 1.37 of the APP, copies of which are enclosed as Exhibit B.
(Id. at 2-3)
The letter then summarizes the Trustees' "understanding of the facts and circumstances related to Mr. Stolarik's arrangement with [t]he Times":
• Mr. Stolarik has been providing freelance photography services for The Times for 15 years. Since 2004, he has been providing services under a contract (see Exhibit C ) that specifically states that he is an independent contractor and not eligible for benefits. Under this arrangement, The Times offers Mr. Stolarik, on a project-by-project basis, the opportunity to photograph events and has no control over the manner in which he does so. He is free to decline any assignment and only receives remuneration if he completes the assignment. Mr. Stolarik provides his own photography equipment except in exceptional situations when the equipment is damaged mid-assignment.
• Until now, Mr. Stolarik has not challenged his freelance status. He has never filed a grievance with the Guild regarding any matter, including The Times' failure to treat him as an employee in the Guild bargaining unit covered by the collective bargaining agreement.
• Mr. Stolarik has repeatedly characterized himself as a freelance photographer on his professional website, in court filings, and other marketing materials.
• Mr. Stolarik operates an independent business providing freelance photography services to media companies other than The Times. For example, Mr. Stolarik's professional website states that he has worked for Time Magazine, Le Monde, *535Newsweek, Le Figaro, U.S. News & World Report, The Wall Street Journal, Paris Match and the Chronicle for Higher Education. This website provides contact information where potential clients can contact him. See Exhibit D.
• Mr. Stolarik is represented professionally by Polaris Images, an independent agency that represents freelance photographers. The Polaris website showcases many images created by Mr. Stolarik as a freelance photographer (for a wide range of clients, including The Times and competitors of The Times). See http://www.polarisimages.com/index.php?43195985213911200340.00009080773976624966525112012153257.
• Mr. Stolarik operates Copyright Collective, an independent business that seeks to enforce copyright laws against media companies on behalf of "independent artists." In fact, Mr. Stolarik has asserted copyright claims against The Times. See Exhibit E.
(Id. at 3-4)
With respect to the Times' classification of Plaintiff as an independent contractor, the Trustees "interpret[ed] the Plans' language ... to exclude an individual who is performing services under a contract that specifically states that he or she is an independent contractor and not eligible for benefits." (Id. at 5) The Trustees went on to state that "even if the Plans were interpreted to exclude only those who are non-employees within the meaning of ERISA, the relevant facts support the classification of Mr. Stolarik as an independent contractor and not an employee." (Id. )
The Trustees also concluded that Plaintiff's benefit claim was barred by the applicable six-year statute of limitations:
In the context of employee benefits, the statute of limitations begins to run or accrue when there is a repudiation of a worker's eligibility for any benefits. See Brennan, 275 F.Supp.2d at 410. A signed independent contractor agreement that specifically denies employee benefits to the worker is clear evidence of repudiation and the statute of limitations will run at the signing of the contract, not when an independent contractor later files a claim for benefits under the plan. Id. All that is needed for repudiation is actual knowledge or reasonable awareness of the classification as an independent contractor and ineligibility for employee benefits. See Downes v. J.P. Morgan Chase & Co., No. 03 Civ.8991 (GEL),2004 WL 1277991 (S.D.N.Y. June 8, 2004) ; Schulman v. Herbert E. Nass & Associates SEP IRA Plan, No. 10 Civ. 9613 (RA),2013 WL 4860119 (S.D.N.Y. Sept. 11, 2013) ; Ferro v. Metro. Ctr. for Mental Health, No. 13 Civ.2347 (PKC),2014 WL 1265919 (S.D.N.Y. Mar. 27, 2014).
Applying these principles to Mr. Stolarik, his claim under the Pension Plan is time-barred. The freelance agreement expressly states in paragraph 9 that Mr. Stolarik is an independent contractor and is not eligible for benefits from the Times. Therefore, Mr. Stolarik's claim accrued on, and the statute of limitations began running no later than April 2, 2004. Even without the signed freelance agreement, as explained below, it was clear from the relationship between the Times and Mr. Stolarik that he was considered an independent contractor at all times and would not receive any employee benefits. Moreover, Mr. Stolarik has never been considered a Pension Plan (or APP Plan) participant or treated as an employee on the Times' books and records. Because the freelance agreement is subject to New York law, *536Mr. Stolarik's claim under the Pension Plan is subject to a 6-year statute of limitations. His claim became timebarred no later than April 2, 2010.
(Id. at 4)
D. Plaintiff's Appeal
On March 16, 2017, Plaintiff submitted an appeal to the Trustees. (See Costello Decl., Ex. J (Mar. 16, 2017 Ltr.) (Dkt. No. 49-10) )
With respect to his classification as an independent contractor, Plaintiff argued that there was "irrefutable proof" demonstrating that he was a Times employee, and contended that the Plan Administrator's findings of fact to the contrary were "clearly erroneous." (Id. at 3)
With respect to the statute of limitations issue, Plaintiff argued that the 2004 Freelance Agreement does not constitute a clear repudiation because (1) "only a fiduciary can rule on the claim for benefits"; and (2) after he signed the Freelance Agreement, "his role very quickly changed and he began working on a full-time basis as an employee, not a freelancer." (Id. )
In a May 5, 2017 letter, the Trustees invited Plaintiff to participate in a hearing regarding the denial of his claim for benefits. (Costello Decl., Ex. M (May 5, 2017 Ltr.) (Dkt. No. 49-13) at 2) The hearing took place on May 19, 2017. (See
On July 25, 2017, the Trustees solicited additional information from the Times regarding Plaintiff's benefit claim. (Costello Decl., Ex. N (July 25, 2017 Email) (Dkt. No. 49-14) at 2) The Trustees asked whether
(1) Plaintiff rejected assignments "in favor of unrelated publications, for other reasons or for no reason at all";
(2) "a staff photographer could reject an assignment if it conflicted with a project unrelated to the Times";
(3) the Times provided the same assignment forms to Plaintiff and staff photographers, and exercised the same level of control over Plaintiff's work;
(4) the Times' fee arrangement with Plaintiff had changed since Plaintiff entered into the 2004 Freelance Agreement; and
(5) whether there was any documentation concerning Plaintiff's argument that he had received assignments in eight-hour blocks.
(Id. )
On August 3, 2017, the Times provided a detailed written response to the Trustees. The Times stated that
(1) in contrast to a staff photographer - who is required to accept an assignment "if he or she is scheduled to work on that particular day" - Plaintiff was free to reject assignments at any time, for any reason, and frequently did so;
(2) the Times did not exercise a high degree of control over Plaintiff's work;
(3) Plaintiff was paid in accordance with the 2004 Freelance Agreement's day rate of $200 at all times, and that Plaintiff "never received employee benefits or fringe benefits from the Times"; and
(4) "[c]ontrary to Mr. Stolarik's assertions, freelance opportunities are not distributed in timed blocks or shifts, and the Times did not specify the amount of time Mr. Stolarik had to devote to an assignment.... As such, there is no documentation to support Mr. Stolarik's claim that he received eight-hour assignments because that was simply not the case."
*537(Costello Decl., Ex. O (Aug. 3, 2017 Ltr.) (Dkt. No. 49-15) at 1-6)
In a September 15, 2017 letter, the Trustees "affirmed the denial of Mr. Stolarik's claims." (Costello Decl., Ex. P (Sept. 15, 2017 Ltr.) (Dkt. No. 49-16) at 1) The Trustees stated that they "interpret the Plans to exclude from eligibility any individual who (i) has entered into an agreement providing that he or she is an independent contractor; (ii) is not treated as an employee in the performance of services; or (iii) does not meet the legal definition of an employee." (Id. at 3) The Trustees concluded that Plaintiff falls within all three categories and "is therefore not eligible for participation in the Plans." (Id. )
DISCUSSION
I. RULE 12(b)(6) STANDARD
"To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.' " Ashcroft v. Iqbal,
Allegations that "are no more than conclusions, are not entitled to the assumption of truth," however. Iqbal,
"In considering a motion to dismiss for failure to state a claim pursuant to Rule 12(b)(6), a district court may consider the facts alleged in the complaint, documents attached to the complaint as exhibits, and documents incorporated by reference in the complaint." DiFolco v. MSNBC Cable L.L.C.,
"Where a document is not incorporated by reference, the court may never[the]less consider it where the complaint 'relies heavily upon its terms and effect,' thereby rendering the document 'integral' to the complaint." DiFolco,
Where a district court considering a motion to dismiss is "presented with matters outside the pleadings," there are "two options." Chambers,
A. The CBA Will Be Considered in Ruling on the Times's Motion to Dismiss
In connection with its motion to dismiss, the Times has submitted the CBA between the Times and the Newspaper Guild of New York. (See CBA (Dkt. No. 44-1) )
While the Amended Complaint does not quote from the CBA, the CBA is incorporated by reference and integral to the Complaint, because the CBA provides the factual premise for Plaintiff's Third and Tenth Causes of Action. Indeed, the CBA is referenced repeatedly throughout the Complaint (see Am. Cmplt. (Dkt. No. 21) ¶¶ 49-51, 57-58, 61, 160, 185), and Plaintiff relies on the terms and effect of the CBA as a basis for claiming a right to the benefits and salary provided to staff photographers. (See, e.g., id. ¶ 61 ("Plaintiff was a Participant within the meaning of both plans, because he was both an employee and within a bargaining unit subject to the Collective Bargaining Agreement."); id. ¶ 160 ("Defendant failed to pay Plaintiff the agreed-to wages and benefits for a staff photographer of the Times, and unlawfully deducted from Plaintiff's wages by paying Plaintiff approximately $25 per hour instead of the salary forth in the collective bargaining agreement of approximately $100,000 per year and by not providing him with the benefits of a staff photographer.") ). Because Plaintiff had actual notice of and relied upon the CBA in drafting the Amended Complaint, this Court will consider the CBA in resolving Times's motion to dismiss. See, e.g., *539Hoops v. KeySpan Energy,
B. The Plan Defendants' Motion to Dismiss Will Be Converted into a Motion for Summary Judgment
The Plan Defendants have moved to dismiss Plaintiff's ERISA Section 502(a)(1)(B) claim for benefits - the Eleventh Cause of Action - on the basis of the administrative record. (See Plan Defs. Br. (Dkt. No. 48) at 5-15; Costello Decl. (Dkt. No. 49) )
Claims for benefits under ERISA are adjudicated on the basis of the administrative record. Suarato v. Building Services 32BJ Pension Fund,
In connection with their motion to dismiss, the Plan Defendants have submitted material outside the pleadings, including the administrative record upon which Plaintiff's claim for benefits is based, the Costello Declaration, and an October 25, 2017 letter indicating that a copy of the administrative record was sent to Plaintiff's counsel. (See Costello Decl. (Dkt. No. 49), Exs. A-P (Dkt. Nos. 49-1 - 49-16) ) Plaintiff received formal notice that the Plan Defendants intended to move for judgment based on the administrative record, however, because the Plan Defendants *540disclosed their intention to do so in their November 13, 2017 pre-motion letter. (See Plan Defs. Ltr. (Dkt. No. 27) ) ) Moreover, Plaintiff has also submitted material from outside the pleadings - including an affirmation and exhibits - that he asks this Court to consider in ruling on the Plan Defendants' motion. (See Bantle Aff. (Dkt. No. 55), Exs. A-C (Dkt. Nos. 55-1 - 55-3) ) Given these circumstances, this Court will convert the Plan Defendants' Rule 12(b)(6) motion into a motion for summary judgment.
II. SUMMARY JUDGMENT STANDARD
Summary judgment is warranted where the moving party shows that "there is no genuine dispute as to any material fact" and that that party "is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). "A dispute about a 'genuine issue' exists for summary judgment purposes where the evidence is such that a reasonable jury could decide in the non-movant's favor." Beyer v. Cty. of Nassau,
In deciding a summary judgment motion, the Court " 'resolve[s] all ambiguities, and credit[s] all factual inferences that could rationally be drawn, in favor of the party opposing summary judgment.' " Spinelli v. City of New York,
III. ERISA STANDARD OF REVIEW
"[A] denial of benefits challenged under [ERISA] must be reviewed under a de novo standard unless the benefit plan gives the administrator or fiduciary discretionary authority to determine eligibility for benefits or to construe the terms of the plan." Firestone Tire and Rubber Co. v. Bruch,
Here, both Plans grant Plan Trustees discretionary authority to interpret the terms of and administer the Plans:
The Trustees shall have sole and absolute discretion and authority to interpret *541and construe the terms and provisions of the Plan, to resolve ambiguities, inconsistencies and omissions therein, to make factual findings and other determinations and to issue rulings regarding the rights and benefits of Members and of all other persons having or claiming an interest in the Plan. In the event of a scrivener's error that renders a Plan term inconsistent with the Trustees' intent, the Trustees' intent controls, and any inconsistent Plan term is made expressly subject to this requirement. The Trustees have the authority to review objective evidence to conform the Plan term to be consistent with the Trustees' intent. Each finding, determination and ruling by the Trustees shall be conclusive, final and binding on the Guild and its members, on the Member or Members involved, on the Group and on all parties claiming any interest under the Plan and may not be further contested. Any determination made by the Trustees shall be given deference in the event it is subject to judicial review and shall be overturned only if it is arbitrary and capricious.
(Costello Decl., Ex. C (The APP Plan) (Dkt. No. 49-3) at 8 § 8.6; Costello Decl., Ex. B (The Guild Plan) (Dkt. No. 49-2) at 11 § 10.6) Accordingly, the arbitrary and capricious standard governs this Court's review of the Trustees' interpretation of the Plans.
"Under the arbitrary and capricious standard of review, [a court] may overturn an administrator's decision to deny ERISA benefits 'only if it was without reason, unsupported by substantial evidence or erroneous as a matter of law.' " Hobson,
Moreover, "a district court's review under the arbitrary and capricious standard is limited to the administrative record." Miller,
IV. THE TIMES'S MOTION TO DISMISS
The Times has moved to dismiss the Amended Complaint's Third and Tenth Causes of Action for unpaid wages pursuant *542to Article 6 of the NYLL § 190 and unjust enrichment. (Times Mot. (Dkt. No. 42) ) The Times contends that Plaintiff's claims are " 'founded directly on rights created by' the CBA between the Times and the Union," and are therefore preempted by Section 301 of the LMRA. (Times Br. (Dkt. No. 43) at 5) According to the Times, because Plaintiff's Third and Tenth Causes of Actions are preempted by Section 301, these claims must be dismissed for failure to exhaust remedies provided in the CBA. (id. at 15)
A. Applicable Law
LMRA Section 301 provides that:
[s]uits for violation of contracts between an employer and a labor organization representing employees in an industry affecting commerce as defined in this chapter, or between any such labor organizations, may be brought in any district court of the United States having jurisdiction of the parties, without respect to the amount in controversy or without regard to the citizenship of the parties.
The preemptive effect of Section 301 also extends "beyond suits alleging contract violations." Id." '[Q]uestions relating to what the parties to a labor agreement agreed, and what legal consequences were intended to flow from breaches of that agreement, must be resolved by reference to uniform federal law, whether such questions arise in the context of a suit for breach of contract or in a suit alleging liability in tort."
"Not every suit concerning employment or tangentially involving a CBA ... is preempted by section 301 [, however]." Vera,
B. Analysis
1. Plaintiff's Unlawful Wage Deduction Claim Under The NYLL
In the Third Cause of Action, Plaintiff asserts an unlawful wage deduction claim pursuant to Article 6 of the NYLL, § 190 et seq. (See Am. Cmplt. (Dkt. No. 21) ¶¶ 157-62) To establish such a claim, Plaintiff is "required to show that [the Times] deducted monies from [his] earned wages and that such deductions are not permissible under the respective state statute." Levy,
Plaintiff's unlawful wage deduction claim is, however, expressly founded upon and derived from rights afforded by the CBA. Indeed, the crux of Plaintiff's claim is that the Times "failed to pay [him] the agreed-to wages and benefits for a staff photographer of the Times, and ... pa[id] [him] approximately $25 per hour instead of the salary set forth in the governing collective bargaining agreement of $100,000 per year and ... the benefits of a staff photographer." (Am. Cmplt. (Dkt. No. 21) ¶ 160) Accordingly, it is clear that Plaintiff is seeking to enforce the CBA itself, and not seeking to enforce state rights independent of the CBA. Allowing Plaintiff to "evade the requirements of § 301 by relabeling [his] contract claim[ ] as [a NYLL] claim[ ]" would "elevate form over substance" and contravene the policies animating Section 301. See Allis-Chalmers,
Accordingly, Plaintiff's claim under Article 6 of the NYLL - as pled in the Amended Complaint - is preempted by federal labor law. See, e.g., O'Rourke v. Carmen M. Pariso. Inc.,
2. Plaintiff's Unjust Enrichment Claim
The Tenth Cause of Action makes a claim for unjust enrichment. (See Am. Cmplt. (Dkt. No. 21) ¶¶ 181-87) "Under New York law, a party claiming unjust enrichment must establish three elements: '(1) that the defendant was enriched; (2) that the enrichment was at the plaintiff's expense; and (3) that the circumstances are such that in equity and good conscience the defendant should return the money or property to the plaintiff.' " Shearon v. Comfort Tech Mech. Co.,
"[I]ndividual employment contracts are not inevitably superseded by any subsequent collective agreement covering an individual employee, and claims based upon them may arise under state law.... [A] plaintiff covered by a collective-bargaining agreement is permitted to assert legal rights independent of that agreement, including state-law contract rights, so long as the contract relied upon is not a collective-bargaining agreement." Caterpillar,
Plaintiff contends that his unjust enrichment claim is not preempted, because he "makes no reference to ... and does not rely on the CBA in any way." (Pltf. Br. (Dkt. No. 53) at 14) The factual allegations in the Amended Complaint make clear, however, that Plaintiff's unjust enrichment claim turns on his assertion that he was a Times employee who was entitled to the benefits and wages paid to staff photographers under the CBA. (See Am. Cmplt. (Dkt. No. 21) ¶¶ 40-41, 61-62, 181-87 (alleging, inter alia, that the Times was unjustly enriched because "Plaintiff performed full-time serves as a staff photographer for the Times ... and the Times accepted those services," yet the Times denied him "a salary equivalent to that of staff photographers ... [and] the benefits provided to staff photographers.") ) As discussed above, Plaintiff's right to the wages and benefits afforded to staff photographers under the CBA hinges on, and would require this Court to apply, the terms of the CBA.
Because Plaintiff's unjust enrichment claim is premised on rights derived from the CBA and the Times's alleged violation of the CBA's terms, it is preempted by the LMRA. See Shearon,
3. Exhaustion of Remedies Under the CBA
"Where, as here, 'the alleged violations hinge on the collective bargaining agreements' definition of the terms of employment, they must be brought under the LMRA and in accordance with the agreement's grievance and arbitration provisions.' " Hoops,
Article XII of the CBA sets forth a detailed grievance and arbitration procedure outlining the process by which disputes arising under the CBA must be resolved. (See CBA (Dkt. No. 44-1) at 75) The CBA provides that:
The Guild shall designate a committee to take up with the Times or its authorized agent any matter arising from the application of this Agreement or affecting the relations of the employees and the Times.
*546....
The subject of any and all employee grievances shall be submitted in writing to the authorized agent of the Times and such authorized agent shall submit in writing any and all Times grievances to the Guild grievance chairperson, for the purpose of discussion so that they may be amicably adjusted.
....
Any matter arising from the application or interpretation of this Agreement that the Guild and the Times have not been able after reasonable effort to settle, shall be submitted to arbitration, upon notice of either party to the other, under the labor arbitration rules of the American Arbitration Association, A demand for arbitration must be submitted in writing within forty-five (45) days from the date of the written denial of the grievance by the authorized representative of the Times or the Guild.
(Id. (emphasis added) ) Because Plaintiff's alleged right to the wages and benefits afforded to staff photographers under the CBA is "inextricably intertwined" with the terms of the CBA, Plaintiff is required to exhaust the grievance and arbitration procedures outlined in the CBA. See Shearon,
Here, Plaintiff's failure to exhaust the grievance procedures outlined in the CBA is undisputed. (See Pltf. Br. (Dkt. No. 53) at 16-17) Accordingly, Plaintiff's Third and Tenth Causes of Actions will be dismissed without prejudice, subject to his exhaustion of contractual remedies. See, e.g., Vera,
V. PLAINTIFF'S ERISA § 502(a)(1)(B) CLAIM FOR BENEFITS
The Plan Defendants have moved to dismiss the Amended Complaint's Eleventh Cause of Action, which pleads an ERISA § 502(a)(1)(B) claim for benefits. (Plan Defs. Br. (Dkt. No. 48) at 5) The Plan Defendants contend that Plaintiff's claim is time-barred and that, in any event, the Trustees' decision denying benefits was not arbitrary and capricious. (See id. at 15-23) As discussed above, the Court has converted the Plan Defendants' motion to dismiss into a motion for summary judgment.
A. Whether Plaintiffs Claim for Benefits is Time-Barred
A six-year limitations period applies to ERISA claims. Guilbert v. Gardner,
"For individuals who claim that they were misclassified, this repudiation occurs 'when the beneficiary first learns that she is considered an independent contractor and is therefore not entitled to benefits, regardless of whether she later files a formal claim for benefits.' " See, e.g., Schulman v. Herbert E. Nass & Assocs. SEP IRA Plan, No. 10 Civ. 9613 (RA),
*548Here, Plaintiff signed the Freelance Agreement with the Times on April 2, 2004. (See Costello Decl., Ex. D (Freelance Agreement) (Dkt. No. 49-4) at 3) The Freelance Agreement explicitly provides that Plaintiff will be treated as an independent contractor and will not be entitled to employee benefits:
You are an independent contractor, and as such you do not receive any benefits as an employee of The Times. The Times will provide you with IRS form 1099 at the end of the year reflecting all amounts paid to you for that year,
(Id. ) Accordingly, by April 2, 2004, Plaintiff was aware that he was classified as an independent contractor and was on clear notice that he would not receive employee benefits. Because Plaintiff did not file his claim for benefits until July 28, 2016 - more than twelve years later - his benefits claim under the Guild Plan is barred by the applicable six-year statute of limitations.
It is undisputed, however, that the APP Plan did not come into existence until January 2013 (See Costello Decl, Ex. C (APP Plan) (Dkt. No. 49-3) at 3), and Plaintiff argues that the statute of limitations "could not have been clearly repudiated prior to the date on which that Plan" came into existence. (Pltf. Br. (Dkt. No. 54) at 9) It would be anomalous to find that Plaintiff was obligated to challenge the repudiation of benefits under the APP Plan in 2004, when the APP Plan was not created until 2013. Moreover, Defendants have cited no authority for the proposition that the date of repudiation starts the limitations clock even for benefit plans that do not exist as of the date of repudiation. Under these circumstances, the Court concludes that the Plan Defendants have not met their burden to demonstrate as a matter of law that Plaintiff's benefits claim under the APP Plan is time-barred.
*549B. Whether the Trustees' Decision to Deny Benefits Under the APP Plan Was Arbitrary and Capricious
The terms of the APP Plan limit participation in the Plan to individuals that meet certain eligibility requirements. The APP Plan defines a "Participant" as "any Member who has: (a) attained age twenty-one (21) and (b) been credited with 500 Hours of Service in one (1) or more Plan Years as a Member." (Costello Decl., Ex. C (The APP Plan) (Dkt. No. 49-3) at 7 § 1.37) "Member," in turn, is defined as "an Employee in one of the bargaining units subject to the Collective Bargaining Agreement or in Foreign Service on whose behalf the Employer makes payments to the Fund pursuant to Article X." (Id. at 6 § 1.34) "Employee" is defined as "any person who is in the employment of the Group," "Group" means the "Employer," and "Employer" is defined as "The New York Times Company for itself and on behalf of The New York Times ... and any other subsidiary covered by the Collective Bargaining Agreement." (Id. at 5, §§ 1.22, 1.23, 1.30) As noted above, the APP Plan grants the Trustees discretionary authority to interpret the terms of, and administer, the Plan, (See
Here, the Trustees interpreted the language requiring that a "Participant" be an "Employee" of the Times "to exclude from eligibility any individual who (i) has entered into an agreement providing that he or she is an independent contractor; (ii) is not treated as an employee in the performance of services; or (iii) does not meet the legal definition of an employee." (Costello Decl., Ex. P (Sept. 15, 2017 Ltr.) (Dkt. No. 49-16) at 3) After reviewing multiple submissions from the parties (see Costello Decl., Ex, J (Mar. 16, 2017 Ltr.) (Dkt. No. 49-10); Costello Decl., Ex. N (My 25, 2017 email) (Dkt. No. 49-14) at 2; Costello Decl., Ex. O (Aug. 3, 2017 Ltr.) (Dkt. No. 49-15) ), and holding a hearing regarding Plaintiff's claim for benefits (see Costello Decl., Ex. M (May 5, 2017 Ltr.) (Dkt. No. 49-13) at 2) ), the Trustees concluded that Plaintiff fell within each of the three categories and was therefore "not eligible for participation in the Plans." (Costello Decl., Ex. P (Sept. 15, 2017 Ltr.) (Dkt. No. 49-16) at 3)
Plaintiff argues that this determination was arbitrary and capricious because (1) where "the term 'employee' is undefined ... the common law definition of 'employee' [under Nationwide Mut. Ins. Co. v. Darden,
As an initial matter, there is no requirement that plan administrators adopt ERISA's common law definition of "employee" in construing the meaning of plan terms, such as "employee" or "employed by the employer." Indeed, courts have uniformly rejected any such requirement. See, e.g., Kolling v. Am. Power Conversion Corp.,
Here, the Trustees' determination that Plaintiff was excluded from benefits under the APP Plan because he entered into a freelance agreement - stating that he was an independent contractor and was not entitled to "receive any benefits as an employee of The Times" (see Costello Decl, Ex. D (Freelance Agreement) (Dkt. No. 49-4) at 3) - was a reasonable interpretation of the APP Plan. See, e.g., Trombetta,
Moreover, even if the Trustees had been required to adopt the common law definition of "employee," it was reasonable for the Trustees to conclude - after applying the Darden factors - that Plaintiff was an independent contractor. (See Costello Decl., Ex. P (Sept. 15, 2017 Ltr.) (Dkt. No. 49-16) at 3-11) The Trustees found that (1) the Times had minimal control over Plaintiff's performance; (2) Plaintiff had "specialized knowledge and skill reflect[ing] his treatment as an independent contractor" rather than as an employee; (3) except in rare circumstances, Plaintiff supplied his own equipment; (4) within the parameters of an assignment, Plaintiff controlled how and where photographs were taken; (5) Plaintiff had no workspace at the Times; (6) Plaintiff was always offered assignments on a "project-by-project basis"; (7) in contrast to a staff photographer, Plaintiff was free at any time to reject an assignment from the Times, Plaintiff "acknowledged that he had declined assignments in the past for personal reasons,"
*551and "correspondence provided by the Times demonstrate[d] that [Plaintiff] ha[d] rejected at least one assignment in order to work for another publication[ ]"; (8) Plaintiff was free to dictate his schedule within the parameters of an assignment and was never paid to be "on-call"; (9) Plaintiff was paid on a project-by-project basis; (10) Plaintiff "acknowledged" that he had the right to hire and pay assistants; (11) Plaintiff operated an independent business and was free to work for competing publications; and (12) Plaintiff signed a freelance agreement acknowledging his status as an independent contractor and disclaiming any right to employee benefits. (See
*552Accordingly, the Plan Defendants will be granted summary judgment on the Amended Complaint's Eleventh Cause of Action.
CONCLUSION
For the reasons stated above, the Times's motion to dismiss the Third and Tenth Causes of Action (Dkt. No. 42) is granted, The Plan Defendants' motion to dismiss the Amended Complaint's Eleventh Cause of Action (Dkt. No. 47) is converted into a motion for summary judgment, and the Plan Defendants are granted summary judgment on that claim. Defendants' requests for oral argument on their motions (Dkt. Nos. 46, 52) are denied as moot. The Clerk of the Court is directed to terminate the motions (Dkt. Nos. 42, 46, 47, 52).
SO ORDERED.
The page numbers of documents referenced in this Order correspond to the page numbers designated by this District's Electronic Case Filing system.
Unless otherwise noted, the following facts are drawn from the Complaint, exhibits attached thereto, and documents incorporated by reference, or integral to the Complaint. The factual allegations in the Complaint are presumed true for purposes of resolving the Times' motion to dismiss. See DiFolco v. MSNBC Cable L.L.C.,
As discussed below, the Plan Defendants' motion to dismiss will be converted into a motion for summary judgment. The facts concerning the denial of Plaintiff's claim for benefits are taken from the Amended Complaint and the administrative record. Where Plaintiff has disputed the Plan Defendants' characterization of cited evidence, and has presented an evidentiary basis for doing so, the Court has relied on Plaintiffs' characterization of the evidence. See Cifra v. Gen. Elec. Co.,
Although in Davenport v. Harry N. Abrams, Inc.,
Plaintiff's argument that he could not have known of the repudiation of benefits until after he obtained the Plan documents (see Pltf. Br. (Dkt. No. 54) at 15) is unavailing. See, e.g., Schulman,
Plaintiff complains that the Trustees' determination that he was not a common law employee is contrary to "substantial evidence" in the administrative record because (1) Plaintiff submitted representative samples of thousands of assignment sheets which demonstrated that the Times exercised control over Plaintiff; and (2) the Trustees failed to compare the level of control exercised over Plaintiff to the level of control exercised over staff photographers. (See Pltf. Br. (Dkt. No. 54) at 20) These arguments fail for several reasons.
First, the Trustees considered the assignment sheets in detail, and explained why they found them to be unpersuasive:
The Times had Minimal Control over Mr. Stolarik's Performance. The Trustees initially denied Mr. Stolarik's claims, in part, on the basis that The Times had little to no control over Mr. Stolarik's work, which showed that The Times treated Mr. Stolarik as an independent contractor. On appeal, Mr. Stolarik argued that The Times had complete control over how and when he performed services for The Times. In support of his position, Mr. Stolarik submitted assignment forms used by The Times to assign projects to photographers. These assignment forms explained the subject of the photography and often explained specific shots desired, such as trying to get police in a frame, trying to get a victim crying, or making a shot tight because it is going in a single column on the page.
After reviewing the assignment forms provided by Mr. Stolarik and considering Mr. Stolarik's oral statements, the Trustees have determined that Mr. Stolarik has control over the manner in which his work was performed, and The Times' influence was only minimal and consistent with an independent contractor relationship. The assignment forms provided to Mr. Stolarik, as well as other photographers, simply contained the information necessary to complete the assignment (i.e., the address, time of event, basic information regarding the underlying news story, the types of shots desired, the necessary specifications in order for those shots to be published, etc.). The assignments forms were merely the means by which assignments were communicated and should not be considered the exercise of control over the manner in which the photographs were taken. For example, the assignment forms did not specify the means or techniques that Mr. Stolarik, as a professional photographer, was to use. These include type of equipment, exposure, aperture, shutter speed, composition, ISO value, focus mechanism, white balance setting, or angle. The Times merely provided information as to what it needed in the end-product, the photographs, not the precise manner of job performance.
The fact that Mr. Stolarik had control over how he produced the requested photographs shows that The Times treated Mr. Stolarik as an independent contractor.
(See Costello Decl., Ex. P (Sept. 15, 2017 Ltr.) (Dkt. No. 49-16) at 4) The Court concludes that the Trustees' determination that the Times exercised "minimal control" over Plaintiff was reasonable.
Moreover, and contrary to Plaintiff's assertion, the Trustees solicited evidence and made specific findings regarding the relative level of control exercised over Plaintiff as compared with staff photographers. (See id. at 7-8, 11 (finding that - in contrast to staff photographers - Plaintiff was not assigned a workspace, and was free to reject assignments, operate his own business, and work for competing publications) )
Based on the administrative record, the Trustees' determination that Plaintiff was not a common law employee was supported by substantial evidence. See Miller,
Reference
- Full Case Name
- Robert STOLARIK v. The NEW YORK TIMES COMPANY, Michele McNally, Trustees of the Newspaper Guild of New York - New York Times Pension Plan, Newspaper Guild of New York - New York Times Pension Plan, Trustees of the Guild-Times Adjustable Pension Plan, and Guild - Times Adjust Able Pension Plan
- Cited By
- 15 cases
- Status
- Published