
USCA1 Opinion

	




                            United States Court of Appeals                                For the First Circuit                                 ____________________        No. 95-1086                                 MARY DEREN, ET AL.,                               Plaintiffs, Appellants,                                          v.                               DIGITAL EQUIPMENT CORP.,                                 Defendant, Appellee.                                 ____________________                     APPEAL FROM THE UNITED STATES DISTRICT COURT                          FOR THE DISTRICT OF MASSACHUSETTS                 [Hon. Frank H. Freedman, Senior U.S. District Judge]                                          __________________________                                 ____________________                                        Before                                  Cyr, Circuit Judge,                                       _____________                      Coffin and Bownes, Senior Circuit Judges.                                         _____________________                                 ____________________            Mark L. Hare for appellants.            ____________            Jay  M. Presser  with  whom  Jeffrey C.  Hummel was  on  brief for            _______________              __________________        appellee.                                 ____________________                                    July 25, 1995                                 ____________________               COFFIN,  Senior Circuit  Judge.    As  part of  a  severance                        _____________________          agreement, plaintiffs signed releases  waiving all claims against          their  former  employer.    Three  and  one  half   years  later,          contending that the  releases had been coerced, they brought this          ERISA  suit.  The  district court dismissed,  applying the common          law rule  that a party may  not avoid a contract  based on duress          without first  returning the consideration received.   We express          no view  on whether  ERISA plaintiffs must  satisfy this  "tender          back" requirement.   Instead, we affirm the  court's dismissal on          the  ground that, by waiting  so long before  attempting to avoid          the releases,  plaintiffs have ratified them,  thus waiving their          claims.                                    I.  Background                                        __________               We  take the  facts  as alleged  in  the complaint.    E.g.,                                                                      ____          Waterson v. Page, 987 F.2d 1, 3 (1st Cir. 1993).  Plaintiffs were          ________    ____          employees   of  a   Digital   Equipment   facility  in   Enfield,          Connecticut.   In May or June 1990, Digital offered all employees          at the Enfield  plant a severance package,  called a Transitional          Financial Support Option  (TFSO), which consisted  of a lump  sum          cash payment of  at least 40  weeks' pay.   Plaintiffs agreed  to          accept the TFSO in a timely manner.  Digital, however, apparently          underestimating  the number  of  employees who  would accept  its          offer, refused to give plaintiffs the TFSO benefits.  Instead, it          gave  the TFSO package to  ten other employees.   Plaintiffs then          requested information  from  Digital concerning  the criteria  by          which the  ten employees  were selected.   Digital, in  response,                                         -2-          offered  plaintiffs an  alternate  severance  package, with  less          generous benefits than  the TFSO.   In November  and December  of          1990, plaintiffs  accepted the alternate severance  plan, and, in          exchange, signed  releases  waiving all  claims against  Digital,          including claims arising out of its refusal to give them the TFSO          benefits.               Plaintiffs filed this suit on June 17, 1994, more than three          and one half  years later,  claiming that they  had been  coerced          into accepting the lesser  package and signing the releases.   In          particular, they  alleged that  Digital had isolated  them, given          them only four days  to accept or reject the alternate  plan, and          told  them that they  would likely suffer  a pay reduction  or be          transferred  or laid  off without  any benefits  if they  did not          accept.   Digital  moved to  dismiss  the  suit on  a  number  of          grounds.  The district court held that ERISA left undisturbed the          common law rule that, as a  precondition to attempting to avoid a          contract or release, the consideration supporting the contract or          release  must  be tendered  back to  the  released party.   Since          plaintiffs concededly have retained the benefits of the alternate          severance package, the district  court concluded that their suits          were not viable.                                    II.  Analysis                                         ________               The parties have extensively briefed whether ERISA displaces          the common  law tender back requirement, a question apparently of                                         -3-          first  impression in  any federal  court of  appeals.1   We leave          this interesting question for another day.               In  In  re Boston  Shipyard Corp.,  886  F.2d 451  (1st Cir.                   _____________________________          1989), we said:               It  is  well  settled  that "[a]  contract  or  release, the               execution of which  is induced by  duress, is voidable,  not               void, and  the person claiming  duress must act  promptly to               repudiate  the contract or release  or he will  be deemed to               have waived his right to do so."           Id. at  455 (quoting Di Rose v. PK Management Corp. 691 F.2d 628,          ___                  _______    ___________________          633-34 (2d Cir. 1982)).  Applying this principle, we found that a          party had  ratified a release agreement by  accepting payment and          waiting for  over a year and one half before claiming that it was          duress-induced.    Id.   We recently  reiterated  the rule.   See                             ___                                        ___          Vasapolli v.  Rostoff, 39  F.3d 27,  35 n.5  (1st Cir. 1994)  ("A          _________     _______          contract signed  under duress is voidable,  but not automatically          void.  By accepting the funds  and failing to seek a remedy based                                        ____________________               1 In  Hogue v. Southern  Ry. Co., 390  U.S. 516  (1968), the                     _____    _________________          Supreme Court held that the Federal Employer Liability Act (FELA)          had  displaced   the   tender  back   requirement,  and   allowed          ___          plaintiff's suit  to  go forward  despite his  failure to  return          consideration received  for a release of claims.   Several courts          of appeals have addressed the applicability of the Hogue decision                                                             _____          to a  variety of remedial statutes, such as 42 U.S.C.   1983, the          ADEA,  Title VII, and the Jones Act, with mixed results.  Compare                                                                    _______          Forbus v.  Sears Roebuck  & Co., 958  F.2d 1036, 1041  (11th Cir.          ______     ____________________          1992) (no tender  back requirement for ADEA plaintiff)  and Oberg                                                                  ___ _____          v. Allied Van Lines, 11 F.3d 679, 684 (7th Cir. 1993) (same) with             ________________                                          ____          Wamsley v.  Champlin Refining and  Chemicals, Inc., 11  F.3d 534,          _______     ______________________________________          539-40  (5th Cir. 1993)  (contra).  See  also Botefur v.  City of                                    ______    ___  ____ _______     _______          Eagle Point,  7 F.3d  152, 156  (9th Cir. 1993)  (no tender  back          ___________          requirement for   1983 plaintiff); Smith v. Pinell, 597 F.2d 994,                                             _____    ______          996 (5th Cir.  1979) (no  tender back requirement  for Jones  Act          plaintiff); Flemming v. U.S.  Postal Service AMF O'Hare,  27 F.3d                      ________    _______________________________          259, 260-62  (7th Cir.  1994) (enforcing tender  back requirement          for  Title VII plaintiff).   None, apparently, has  been asked to          determine whether Hogue applies to ERISA.                            _____                                         -4-          on  duress  within a  reasonable  period  of time  .  .  . ,  the          plaintiffs forfeited  any entitlement to relief  on this basis.")          (citations omitted).  See also Abbadessa v. Moore Business Forms,                                ___ ____ _________    _____________________          Inc., 987 F.2d 18, 22-24 (1st Cir. 1993) (finding ratification of          ____          an allegedly avoidable release under  New Hampshire law).   Other          courts  agree.    E.g.,  Sutter  Home  Winery,  Inc.  v.  Vintage                            ____   ___________________________      _______          Selections,  Ltd.,  971  F.2d 401,  409  (9th  Cir. 1992)  (after          _________________          accepting  the benefits of an agreement for four years, party may          no longer avoid  the agreement based on  claimed duress); Grillet                                                                    _______          v.  Sears, Roebuck  & Co.,  927  F.2d 217,  220  (5th Cir.  1991)              _____________________          (retaining   benefits  of  release   for  two  years  constitutes          ratification).               We  think the instant case  falls squarely within this rule.          The  undisputed facts  show that,  for three  and one  half years          after any claimed duress  had passed, the plaintiffs enjoyed  the          benefits of  the bargain  they now  wish to  avoid.   During this          time,  they never sought  to repudiate their  agreements based on          duress.2    Thus, whether  or  not  the releases  initially  were                                        ____________________               2 We think the district court was overly generous in stating          that plaintiffs claimed they  orally had repudiated the releases.          The  court  cited only  to a  footnote in  plaintiffs' memorandum          opposing  the  motion  to   dismiss,  which  asserted  that  they          "notified  Digital of  their claims  promptly."   To  repudiate a          contract, however, "a party must unequivocally declare his intent          not to perform  his obligation."   Taylor v.  Gordon Flesch  Co.,                                             ______     ___________________          Inc., 793  F.2d 858, 864 (7th Cir. 1986).  Plaintiffs point to no          ____          such unambiguous  statement of intent to  disavow their agreement          to  forego legal  claims against  Digital before they  filed this          lawsuit.  The language relied on by the district court is far too          vague  to be  read  as a  claimed  repudiation of  the  releases.          Indeed, we  suspect it might  refer to  what plaintiffs'  counsel          described   at  oral  argument   as  plaintiffs'  post-settlement          requests  for  information concerning  the  TFSO.   Perhaps  more                                         -5-          secured  through  duress,  plaintiffs   ratified  them  by  their          subsequent  conduct.  See Boston Shipyard, 886 F.2d at 455 (party                                ___ _______________          may ratify an agreement entered into under duress by, inter alia,                                                                _____ ____          "`remaining silent or acquiescing in the contract for a period of          time  after he has the opportunity to avoid it'") (quoting United                                                                     ______          States v.  McBride, 571 F.  Supp. 596, 613 (S.D.Tex.  1988)).  By          ______     _______          ratifying  the releases,  plaintiffs waived  the claims  they now          attempt to assert.  Their complaint was properly dismissed.               Affirmed.               ________                                        ____________________          importantly, the  essential document  for evaluating a  motion to          dismiss,  the  amended  complaint,  contains  no  allegation that          plaintiffs repudiated the releases  before bringing suit.                                         -6-
