by Jackson Lewis

A unanimous U. S. Supreme Court has ruled a four-year statute of limitations applies to a class action lawsuit alleging wrongful discharge, hostile work environment, and refusal to transfer in violation of the Civil Rights Act of 1991. The "catchall 4-year statute of limitations," 28 U.S.C. Section 1658, was enacted by Congress to apply to causes of action "arising under an Act of Congress enacted after December 1, 1990." Given that the 1991 Civil Rights Act enlarged the category of conduct for which employers could be liable, the 1991 Act qualified as "an Act of Congress enacted after December 1, 1990" subject to the "catchall 4-year statute of limitations," the Court concluded. Jones v. R.R. Donnelley & Sons Company.

Facts of the case. The plaintiffs in the case were African-American former employees of the employer's Chicago manufacturing division. In 1994, they filed a class action alleging violations of their rights under Section 1981 of the Civil Rights Act of 1866, as amended by the Civil Rights Act of 1991. Specifically, the plaintiffs alleged they were subjected to a racially hostile work environment, were given inferior employee status, and were either wrongfully terminated of denied transfers in connection with the closing of the Chicago facility.

Lower court decisions. While the federal trial court determined the timeliness of the class action was governed by the catchall federal four-year limitations statute, the U. S. Court of Appeals for the Seventh Circuit disagreed. Agreeing with two other federal appeals courts (Third and Eighth Circuits), the Seventh Circuit found the amendments of 1991 attached to the original statute of 1866, obviously beyond the reach of the federal limitations period statute specifying December 1, 1990. Accordingly, it would be necessary to apply a state statute of limitations, and not the federal one, in determining whether the class action was timely filed.

Supreme Court decision. In reversing that decision, the Supreme Court emphasized that one of the reasons for the enactment of the federal statute creating the four-year limitations period was to avoid the uncertainty for litigants and federal judges of determining which state statutes of limitations to apply. The Court concluded that a cause of action "arises under an Act of Congress enacted" after December 1, 1990 and is subject to the federal four-year limitations period, "if the plaintiff's claim against the defendant was made possible by a post-1990 enactment." In this case, the hostile work environment, wrongful termination, and failure-to-transfer claims "arose under" the 1991 Civil Rights Act "in the sense that petitioners' causes of action were made possible by the Act."

The case has been remanded to the trial court for further proceedings in accord with the Supreme Court's decision. Although the procedural arguments and the judicial reasoning are complicated, the unanimous opinion of the Court is relatively simple. The timeliness of lawsuits alleging employer actions that were made unlawful by the Civil Rights Act of 1991 will be governed by the federal "catchall 4-year statute of limitations" which specifically applies to "actions arising under federal statutes enacted after December 1, 1990." This holding will eliminate much of the uncertainty caused by the need to determine which state statute of limitations should apply to this kind of employment litigation.