Federal Appeals Court revives fired NC Justice Department employee’s race discrimination suit

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  • A unanimous 4th U.S. Circuit Court of Appeals decision will allow a fired N.C. Justice Department worker to pursue a race discrimination case against former supervisors.
  • Appellate judges agreed that a trial court applied the wrong statute of limitations in the case.

The 4th U.S. Circuit Court of Appeals will allow a fired N.C. Justice Department employee to proceed with her race discrimination case against former supervisors. Appellate judges ruled that a trial court had applied the wrong statute of limitations to the case.

Margaret Chambers, “an African American woman,” started work as an investigator in the state Justice Department’s Medicaid Investigations Division in 2007. Timothy Rodgers and Robin Pendergraft served as Chambers’ supervisors, according to the unanimous 4th Circuit opinion released Monday.

“In her complaint, she alleges that after participating in an investigation into alleged misconduct by Rodgers, she was subjected to racially discriminatory and disparate treatment by Rodgers and Pendergraft,” wrote Judge James Wynn.

Chambers was fired on Nov. 21, 2017. “[J]ust shy of four years later, she filed this action on November 19, 2021, alleging wrongful termination,” Wynn wrote.

The claim invoked two pieces of federal law, known as Section 1981 and Section 1983. The first is designed to guarantee equal rights under the law “to make and enforce contracts” regardless of race. The second allows for civil lawsuits to address claims about the violation of rights.

U.S. District Judge Max Cogburn dismissed Chambers’ suit in May 2022. Among his reasons was a three-year statute of limitations.

When the case reached oral arguments at the 4th Circuit, Chambers conceded that the state Justice Department should be dropped as a defendant in her suit. She also conceded dropping portions of her suit against Rodgers and Pendergraft.

But Chambers argued that Cogburn should have allowed some of the lawsuit’s complaints to move forward.

Neither Section 1981 nor Section 1983 “carries an explicit statute of limitations,” Wynn wrote. Cogburn compared Chambers’ suit to a personal injury complaint. “That is apparently why the district court applied North Carolina’s three-year limitations period for personal-injury claims, under which it determined that Chambers’s complaint was untimely,” Wynn explained.

But Wynn cites a 1990 federal law, “which established a catchall four-year statute of limitations for federal claims ‘arising under’ any act of Congress that was enacted after December 1, 1990,” unless that act set its own statute of limitations. When the 1990 law applies to a case, “its four-year statute of limitations supersedes any analogous state-law limitations period for purposes of claims pursuant to federal law.”

Though Section 1981 dates back to the 1866 Civil Right Act, a 1991 federal law expanded it “to
prohibit race discrimination post-contract formation, including in the termination of contracts,” Wynn wrote.

The 1991 law made Chambers’ lawsuit possible, so the four-year statute of limitations applies to her case, appellate judges concluded. Wynn and his colleagues rejected the defendants’ argument that the court should focus on Section 1983, which was enacted “well before” 1990.

“[A] plaintiff must use § 1983 as a vehicle to assert a § 1981 claim against a state actor. But what matters for determining the proper limitations period is the substance of the underlying claim,” Wynn wrote. “For an action brought to vindicate rights established under § 1981, this question turns on whether the claim concerns discrimination post-contract formation that was not actionable under the original, pre-1990 statute.”

Since some of Chambers’ claims remain alive with a four-year statute of limitations, the case will return to a trial court to address those claims.

Judges Pamela Harris and Toby Heytens joined Wynn’s opinion.