Abdul Jaludi v. Citigroup

57 F.4th 148

• Court: Court of Appeals for the Third Circuit
• Decided: January 4, 2023
• Docket: 21-1108
• Status: Published

Opinion

PRECEDENTIAL

UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT _______________

No. 21-1108 _______________

ABDUL A. JALUDI, Appellant v.

CITIGROUP AND COMPANY or one or more of its direct or indirect subsidiaries

On Appeal from the United States District Court for the Middle District of Pennsylvania (D.C. No. 3:15-cv-02076) District Judge: Honorable Malachy E. Mannion _______________

Argued: May 25, 2022

Before: KRAUSE, BIBAS, and PHIPPS, Circuit Judges

(Filed: January 4, 2023) _______________

Christina Bowen [ARGUED] Emily Erwin Mary E. Levy Arielle Schoenburg TEMPLE UNIVERSITY BEASLEY SCHOOL OF LAW 1719 N. Broad St. Philadelphia, PA 19122

Jessica Rickabaugh TUCKER LAW GROUP 1801 Market St. Ten Penn Center, Suite 2500 Philadelphia, PA 19103

Counsel for Appellant

Christen L. Casale SALMANSON GOLDSHAW 1500 John F. Kennedy Blvd. Two Penn Center, Suite 1230 Philadelphia, PA 19102

Thomas A. Linthorst [ARGUED] MORGAN LEWIS & BOCKIUS 502 Carnegie Center Princeton, NJ 08540

William R. Peterson MORGAN LEWIS & BOCKIUS 1000 Louisiana St., Suite 4000 Houston, TX 77002

Counsel for Appellee

2 _______________

OPINION OF THE COURT _______________

BIBAS, Circuit Judge. Procedural errors can sink a case, even if they are not juris- dictional. Abdul Jaludi made two such errors on his way to fed- eral court: he filed his administrative complaint after the statute of limitations had run, and he sued before exhausting his ad- ministrative remedies. Though neither mistake was jurisdic- tional under the Sarbanes-Oxley Act, his delay in filing justi- fied the District Court’s dismissal. We will thus affirm. I. BACKGROUND Jaludi had a flourishing career at Citigroup. But after he reported company wrongdoing, he was demoted, transferred, and (in 2013) let go. His troubles did not end there. Citigroup, he claims, blacklisted him from the whole financial industry. In 2015, Jaludi sued Citigroup for retaliation. He brought claims under both the Sarbanes-Oxley Act and the Racketeer Influenced and Corrupt Organizations Act. The District Court sent his claims to arbitration. Jaludi appealed the arbitration order. In early 2018, while that appeal was pending, he filed an administrative complaint with the Secretary of Labor. That complaint rehashed the alle- gations here, and added one more: In late 2017, a headhunter had stopped returning his calls. Citigroup, he suspected, was behind this silent treatment. We then decided his appeal, hold- ing that he need not arbitrate his Sarbanes-Oxley claims, and

3 remanded to let them proceed in court. Jaludi v. Citigroup, 933 F.3d 246, 248 (3d Cir. 2019). But Jaludi’s victory was short-lived. On remand, the Dis- trict Court dismissed for failure to state a claim because his administrative complaint was untimely. Though Sarbanes- Oxley required an administrative complaint within 180 days of the retaliatory conduct, he had waited more than two years after the last incident. We appointed Mary Levy of Temple University’s Beasley School of Law to brief this appeal on Jaludi’s behalf, together with her law students Christina Bowen, Emily Erwin, and Ari- elle Schoenburg. Jessica Rickabaugh also contributed to the brief, and Bowen argued the case for Jaludi. We thank them all for their service to our Court. On appeal, both parties say the District Court got it wrong. Jaludi says the court should have granted him leave to amend because the 2017 allegation that he added in his administrative complaint happened fewer than 180 days before that com- plaint, making it timely. Citigroup says that Jaludi failed to ex- haust his administrative remedies before suing, so the court should have dismissed for lack of jurisdiction. II. UNDER SARBANES-OXLEY, NEITHER TIMELINESS NOR EXHAUSTION IS JURISDICTIONAL We start, of course, with jurisdiction, which we review de novo. Great W. Mining & Min. Co. v. Fox Rothschild LLP, 615 F.3d 159, 163 (3d Cir. 2010). Congress can limit our jurisdic- tion by imposing procedural requirements. But not all proce- dural requirements are jurisdictional. Some speak only to the

4 parties’ duties, not our power. Boechler, P.C. v. Comm’r, 142 S. Ct. 1493, 1497 (2022). They prescribe the route that parties must take to the courthouse doors but do not lock those doors. To be sure, violations of a nonjurisdictional procedural require- ment often end in dismissal. Fort Bend Cnty. v. Davis, 139 S. Ct. 1843, 1849 (2019). But because they do not deprive us of jurisdiction, we can sometimes overlook or excuse them. Boechler, 142 S. Ct. at 1497. By contrast, violating a jurisdictional procedural require- ment locks the courthouse doors. “Jurisdictional requirements cannot be waived or forfeited, must be raised by courts sua sponte, and … do not allow for equitable exceptions.” Id. Be- cause these consequences are severe, Congress must state clearly that a procedural requirement is jurisdictional. Id. It need not use magic words. Instead, “traditional tools of statu- tory construction must plainly show that Congress imbued a procedural bar with jurisdictional consequences.” United States v. Kwai Fun Wong, 575 U.S. 402, 410 (2015). One such traditional tool is statutory context. Id. at 411. The Supreme Court “has often explained that Congress’s separation of a [procedural bar] from a jurisdictional grant indicates that the … bar is not jurisdictional.” Id.; see, e.g., Arbaugh v. Y&H Corp., 546 U.S. 500, 505, 514–15 (2006) (explaining that Title VII’s fifteen-employee threshold was not jurisdictional because Congress put it in the statute’s definitional section, not its jurisdictional provision); Reed Elsevier, Inc. v. Muchnick, 559 U.S. 154, 164–65 (2010) (emphasizing that neither of the provisions granting district courts jurisdiction to hear copyright-infringement actions mentions the Copyright Act’s

5 registration requirement). But it is not enough to put a proce- dural bar and a jurisdictional grant in the same provision, or even in the same sentence. Boechler, 142 S. Ct. at 1499. Rather, there must be “a clear tie between” the two. Id. Jaludi made two procedural mistakes. First, he waited more than 180 days to file an administrative complaint and thus exceeded Sarbanes-Oxley’s statute of limitations. 18 U.S.C. § 1514A(b)(2)(D). Second, he did not file that complaint until after he sued in federal court, violating the exhaustion require- ment. Id. § 1514A(b)(1)(B). As the District Court rightly held, neither requirement is jurisdictional. A. Sarbanes-Oxley’s statute of limitations is not jurisdictional The Act’s statute of limitations is not jurisdictional. That provision specifies that an administrative complaint must be filed “not later than 180 days after the date on which the viola- tion occurs, or after the date on which the employee became aware of the violation.” 18 U.S.C. § 1514A(b)(2)(D). It does not “speak in jurisdictional terms or refer in any way to the jurisdiction of the district courts.” Zipes v. Trans World Air- lines, Inc., 455 U.S. 385, 394 (1982). It is tucked under a para- graph labeled “Procedure” and is structurally separate from any provision mentioning jurisdiction. See Kwai Fun Wong, 575 U.S. at 411–12; Henderson ex rel. Henderson v. Shinseki, 562 U.S. 428, 439 (2011). The Act gives no hint, let alone a “clear” one, that this time limit is jurisdictional. Kwai Fun Wong, 575 U.S. at 409–10. Plus, we recently held that an al- most identically worded time limit in another statute was not jurisdictional. Guerra v. Consol. Rail Corp., 936 F.3d 124,

6 133–35 (3d Cir. 2019). So as the District Court held, Jaludi’s delay past the statute of limitations did not defeat jurisdiction. B. Nor is its exhaustion requirement jurisdictional Jaludi’s failure to file an administrative complaint before suing is a closer case. Sarbanes-Oxley specifies that a party “may seek relief” by (A) filing a complaint with the Secretary of Labor; or (B) if the Secretary has not issued a final decision within 180 days of the filing of the complaint and there is no showing that such delay is due to the bad faith of the claimant, bringing an action at law or equity for de novo review in the appropriate district court of the United States, which shall have jurisdiction over such an action without regard to the amount in controversy. 18 U.S.C. § 1514A(b)(1). Section 1514A(b)(1)(B) is a kick-out provision: it lets a party sue in district court if the administra- tive process drags on too long. This provision implicitly requires exhaustion. A party can sue in district court only after filing an administrative complaint. The exhaustion requirement is not clearly jurisdictional. True, several factors plausibly support reading it as jurisdic- tional. But a plausible or even preferable reading is not enough to make a statement clear. Boechler, 142 S. Ct. at 1499. Though structurally the exhaustion requirement sits in a separate para- graph from the one titled “Procedure,” that paragraph’s head- ing does not mention jurisdiction. And though it is in a single sentence that also mentions jurisdiction at the end, we must parse that sentence to discern which parts are jurisdictional. Id.

7 (citing Weinberger v. Salfi, 422 U.S. 749, 763–64 (1975)). Most of the sentence addresses litigants, as nonjurisdictional provisions typically do. E.g., EPA v. EME Homer City Gener- ation, L.P., 572 U.S. 489, 512 (2014). Only the relative clause at the end—“which shall have jurisdiction over such an ac- tion”—speaks to courts and their power. This jurisdictional clause is not tied clearly enough to the exhaustion requirement. Under the canon of the last anteced- ent, a referent usually refers only as far back as “the nearest reasonable” antecedent. Boechler, 142 S. Ct. at 1498 (quoting Antonin Scalia & Bryan A. Garner, Reading Law 144 (2012)). “Such an action” naturally refers to “an action at law or equity”—not the earlier exhaustion requirement. What is more, letting “such an action” import everything that comes before would also import an exception for a “showing that such delay is due to the bad faith of the claimant.” Jurisdictional rules tend to be clear, yet bad faith is murky and requires factfinding. Though Congress could make good faith a jurisdictional re- quirement, it rarely if ever does. We doubt that it did so here; it certainly did not do so clearly. Thus, the jurisdictional clause does not incorporate the earlier exhaustion requirement. Other statutes more clearly tie jurisdiction to procedural re- quirements, “accentuat[ing] the lack of comparable clarity” here. Id. at 1499. Boechler gave two examples. Id. at 1498–99. In one, the Tax Court has “jurisdiction over any action … if such action is brought within 180 days.” 26 U.S.C. § 6404(g)(1) (1994 ed., Supp. II) (emphasis added). In the other, “[t]he individual may petition the Tax Court (and the Tax Court shall have jurisdiction) to determine the appropriate re- lief available to the individual under this section if such petition

8 is filed during the 90-day period.” § 6015(e)(1)(A) (1994 ed., Supp. IV) (emphasis added). We can find no such language ex- pressly conditioning jurisdiction on exhaustion in Sarbanes- Oxley, and the parties cite none. Our precedent confirms our reasoning. Guerra read a sim- ilarly worded provision in another statute as granting jurisdic- tion over an action at law or equity rather than restricting juris- diction to exhausted claims. 936 F.3d at 135. True, our holding today rejects the Second Circuit’s contrary approach. Daly v. Citigroup Inc., 939 F.3d 415, 427–28 (2d Cir. 2019). But Daly predates Boechler and never considered the last-antecedent canon. Daly also stressed that the exhaustion requirement was in the same sentence as the jurisdictional provision, even though Boechler later warned against relying on that mere proximity. Compare id. at 427, with Boechler, 142 S. Ct. at 1499. So we must follow Boechler and Guerra, not Daly. Because neither the Act’s time limit nor its exhaustion requirement clearly states that it is jurisdictional, we proceed to the merits. III. JALUDI’S COMPLAINT CAME TOO LATE, AND AMENDMENT WOULD BE FUTILE

As mentioned, Jaludi had to file an administrative com- plaint within 180 days of suffering or discovering retaliation against him. See 18 U.S.C. § 1514A(b)(2)(D). But after learn- ing of the alleged misconduct, he waited years to do so. So this suit is time-barred. And that untimeliness dooms his case. Plus, the District Court rightly held that amending would be futile. Jaludi seeks to rescue his late complaint by adding a

9 timely allegation. He says that in late 2017, he submitted a résumé to a headhunter who had reached out to him about a job opening, but he never heard back. He blames this silence on “his blacklisting at Citigroup.” Appellant’s Br. 40. But there is no reason to think that Citigroup had anything to do with this silence, let alone that Jaludi’s whistleblowing was a “contrib- uting factor” to the headhunter’s unresponsiveness. Wiest v. Tyco Elecs. Corp., 812 F.3d 319, 330 (3d Cir. 2016). This pro- posed allegation is implausible. Because the complaint, even as amended, would fail to state a claim, the court properly denied leave to amend. See In re Digit. Island Sec. Litig., 357 F.3d 322, 337 (3d Cir. 2004). * * * * * Jaludi sued Citigroup and then filed an administrative com- plaint after the statute of limitations had run out. Neither Sarbanes-Oxley’s statute of limitations nor its exhaustion re- quirement is jurisdictional. But because the administrative complaint was untimely, we will affirm the District Court’s dis- missal with prejudice.