did not accrue until August 16, 1991 at the earliest. Even if a six-month limitation period applies, plaintiff's claim was timely when filed on February 14, 1992. A defense is not available to the extent plaintiff's claim is based on a layoff of employees.
Because it is possible that plaintiff's claim is actually based on a termination of employment, it still must be considered what statute of limitations applies. The defense can only be stricken in its entirety if a limitation period of one year or more applies.
Only three cases have considered the appropriate statute of limitations for WARN claims. Two of those cases borrow the six-month limitation period of the NLRA, 29 U.S.C. § 160(b). See Newspaper & Mail Deliverers' Union of New York & Vicinity v. United Magazine Co., 809 F. Supp. 185, 188-92 (E.D.N.Y. 1992); Staudt v. Glastron, Inc., 1993 U.S. Dist. LEXIS 3090 (W.D. Tex. Feb. 23, 1993). The other case borrows a six-year limitation period from state contract law. See Wallace v. Detroit Coke Corp., 818 F. Supp. 192, 1993 U.S. Dist. LEXIS 4497, 1993 WL 105481 *2-3 (E.D. Mich. April 8, 1993).
The ordinary rule is that, when Congress is silent as to a statute of limitations, the state time limitation most analogous to the case at hand is borrowed. Lampf, Pleva, Lipkind, Prupis & Petigrow v. Gilbertson, 115 L. Ed. 2d 321, 111 S. Ct. 2773, 2778 (1991). There are exceptions to the general rule, but the general rule is not to be lightly abandoned. Id. "Federal borrowing [is] 'a closely circumscribed exception,' to be made 'only when a rule from elsewhere in federal law clearly provides a closer analogy than available state statutes, and when the federal policies at stake and the practicalities of litigation make that rule a significantly more appropriate vehicle for interstitial lawmaking.'" Id. (quoting Reed v. United Transportation Union, 488 U.S. 319, 324, 109 S. Ct. 621, 102 L. Ed. 2d 665 (1989)).
A three-step inquiry is to be applied in determining which statute of limitations should be borrowed. First, it must be determined whether a uniform statute of limitations is to be selected. Lampf, 111 S. Ct. at 2779. If it is determined that a uniform statute of limitations is desirable, it must then be determined whether the source of that standard should be state or federal, with particular weight being accorded to the geographical character of the claim. Id. "Finally, even where geographical considerations counsel federal borrowing, the aforementioned presumption of state borrowing requires that an analogous federal source truly affords a 'closer fit' with the cause of action at issue than does any available state-law source. Although considerations pertinent to this determination will necessarily vary depending upon the federal cause of action and the available state and federal analogues, such factors as commonality of purpose and similarity of elements will be relevant." Id. The three-step process is a "hierarchical inquiry." Id. at 2778; Kahn v. Kohlberg, Kravis, Roberts & Co., 970 F.2d 1030, 1033 (2d Cir.), cert. denied, 121 L. Ed. 2d 432, 113 S. Ct. 494 (1992). There is no need to consider each additional step of the inquiry unless the previous step is first found to point to borrowing a federal limitation period. See Lampf, 111 S. Ct. at 2779.
The Supreme Court has said that: "Where a federal cause of action tends in practice to 'encompass numerous and diverse topics and subtopics,' such that a single state limitations period may not be consistently applied within a jurisdiction, we have concluded that the federal interests in predictability and judicial economy counsel the adoption of one source, or class of sources, for borrowing purposes." Id. (quoting Wilson v. Garcia, 471 U.S. 261, 273, 85 L. Ed. 2d 254, 105 S. Ct. 1938 (1985)). For example, the Racketeer Influenced and Corrupt Organizations Act, 18 U.S.C. § 1961, incorporates a large variety of predicate acts and thus could be analogized to numerous state causes of action. See Agency Holding Corp. v. Malley-Duff & Associates, Inc., 483 U.S. 143, 97 L. Ed. 2d 121, 107 S. Ct. 2759 (1987). Claims under 42 U.S.C. § 1983 are another example. See Wilson, supra. Here, however, there is basically only one type of claim, a damages claim for lost wages and benefits for failure to provide proper notice.
There should not be a problem of having too many analogies to choose from under state law.
The second step also does not point to borrowing a uniform federal limitation period. When claims may be multistate in nature, then the geographical inquiry of the second step supports adopting a federal standard. See Lampf, 111 S. Ct. at 2779 (quoting Agency Holding Corp., 483 U.S. at 147). WARN claims, by definition, are limited to a single site. See 29 U.S.C. § 2101(a)(2)-(3) (defining "plant closing" & "mass layoff"). The lawsuit, however, need not be filed in the district where the site is located, but may be filed in any district where the employer transacts business. Id. § 2104(a)(5). Still, choice of law rules would likely point to borrowing the law of the site since that would be the place of the injury, and probably the place of the unlawful action as well. Therefore, it is unlikely that a WARN plaintiff would be able to forum shop for a locale with the most advantageous statute of limitations; the law of the site of the layoff would likely be chosen no matter where the suit happened to be filed. Also, difficult questions of which state law to choose are unlikely to arise since there will only be one site, not conduct occurring in multiple locations or claims based on unlawful interstate transactions. It is also possible that an employer will conduct layoffs at a number of sites on the same day. Assuming state law is to be borrowed and suits arise from a number of different sites in different states, each of the individual suits might have a different limitation period. However, such instances will give rise to separate suits, each with its own clear statute of limitations. Because the second step does not point to applying a uniform federal limitation period, the third step need not be considered. Cf. Bowdry v. United Air Lines, Inc., 956 F.2d 999, 1005 (10th Cir.), cert. denied, 113 S. Ct. 97 (1992).
However, even if it is assumed that the first two steps point to selecting a uniform federal limitations period, this is not the type of claim in which federal interests call for applying a uniform federal limitation period. Wallace, 818 F. Supp. 192, 1993 WL 105481 at *3 United Magazine, 809 F. Supp. at 190-91, points to a variety of labor law actions for which the NLRA's six-month limitation period has been borrowed. The cases cited all involved actions in which a union necessarily was involved in a dispute with the employer.
While WARN specifically provides standing to unions, see 29 U.S.C. §§ 2101(a)(4), 2104(a)(5), and this case happens to have been brought by a union, there is no requirement that the claim be brought by a union. Also, the statute is not limited to union employees and claims can also be made by management employees. Additionally, WARN limits relief to a claim for damages and expressly excludes injunctive relief preventing a layoff or termination. Therefore, even when a union is involved, the circumstances do not necessarily involve a continuing employer-union or employer-employee relationship since the employees will already have been terminated or at least laid off for more than six months. Instead, claims will generally involve damages related to a former employment relationship, not a continuing employment relationship.
Even in the situations in which a union is involved, not all cases involving a dispute between a union and an employer call for borrowing the six-month limitation period under the NLRA. Despite being a subject that "peculiarly . . . calls for uniform law," Johnson v. Graphic Communications International Union, 930 F.2d 1178, 1180 (7th Cir.), cert. denied, 116 L. Ed. 2d 145, 112 S. Ct. 184 (1991) (quoting Teamsters v. Lucas Flour, 369 U.S. 95, 103, 7 L. Ed. 2d 593, 82 S. Ct. 571 (1962)), a § 301 claim by a union against an employer for breach of the collective bargaining agreement borrows its limitation period from state contract law. Johnson, 930 F.2d at 1180 (citing United Auto Workers v. Hoosier Cardinal Corp., 383 U.S. 696, 86 S. Ct. 1107, 16 L. Ed. 2d 192 (1966); International Union of Elevator Constructors v. Home Elevator Co., 798 F.2d 222 (7th Cir. 1986)). Like Hoosier Cardinal, the present case does not involve "those consensual processes that federal labor law is chiefly designed to promote--the formation of the collective agreement and the private settlement of disputes under it." Johnson, 930 F.2d at 1180 (quoting Hoosier Cardinal, 383 U.S. at 702). The dispute in Hoosier Cardinal involved a claim somewhat similar to the claim in the present case, the failure to pay accumulated vacation pay to terminated employees. Unlike, Hoosier Cardinal, the source of the present claim for wages and benefits to terminated or laid off employees is a statute, not a collective bargaining agreement. The union's standing in this case is based on its status as the exclusive bargaining representative under the NLRA, but the dispute in this case does not in any way involve interpretation or enforcement of the collective bargaining agreement. Relief under WARN is independent of any possible relief under the collective bargaining agreement or under any other federal labor law. See 29 U.S.C. § 2105. Although Hoosier Cardinal involved a dispute over enforcing a provision of the collective bargaining agreement, the NLRA six-month period was not borrowed. The present case does not involve enforcement of a provision of the collective bargaining agreement; it is a less compelling case for borrowing from the NLRA. See Wallace, 818 F. Supp. 192, 1993 WL 105481 at *3 ("Since WARN rights have no direct relationship to collective bargaining procedures and because many WARN Act plaintiffs are not represented by unions," the six-month NLRA limitation period is inapplicable).
The NLRA limitation period is not a "close fit." Lampf, 111 S. Ct. at 2779. Federal interests do not call for applying the six-month limitation period of the NLRA even if the first two steps of the inquiry were satisfied. The limitation period of § 10(b) of the NLRA will not be borrowed.
There is no possibility that any claim of plaintiff would be barred unless the borrowed limitation period is less than one year. Other than § 10(b) of the NLRA, neither party points to any possibly analogous limitation period (state or federal) that is that short in length. Therefore, it is unnecessary at this time to determine the particular statute from which to borrow. Whatever limitation period is borrowed, plaintiff's claim would still be timely.
IT IS THEREFORE ORDERED that plaintiff's motion to strike fifth affirmative defense  is granted. The fifth affirmative defense of defendant's amended answer is stricken. Status hearing set for June 25, 1993 at 9:15 a.m., which is also the discovery closing date.
William T. Hart
UNITED STATES DISTRICT JUDGE
Dated: APRIL 29, 1993