Johnson v. Aramco Services Co, et al

United States Court of Appeals
Fifth Circuit
F I L E D
January 10, 2006
Charles R. Fulbruge III
Clerk
In the
United States Court of Appeals
for the Fifth Circuit
_______________
m 04-20557
Summary Calendar
_______________
PETER BERNARD JOHNSON,
ON BEHALF OF HIMSELF AND ALL PERSONS SIMILARLY SITUATED,
Plaintiff-Appellant,
VERSUS
ARAMCO SERVICES COMPANY; SAUDI ARABIAN OIL COMPANY,
Defendants-Appellees.
_________________________
Appeal from the United States District Court
for the Southern District of Texas
m 4:04-CV-642
_________________________

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ON PETITION FOR
REHEARING EN BANC
Before DAVIS, SMITH, and DENNIS,
Circuit Judges.
JERRY E. SMITH, Circuit Judge:*
The second opinion, 134 Fed. Appx. 547
(5th Cir. May 31, 2005), which replaced the
first opinion, 120 Fed. Appx. 547 (5th Cir.
Jan. 31, 2005), is WITHDRAWN, and the fol-
lowing opinion is substituted:
* * *
Peter Johnson appeals the dismissal, for
want of subject matter jurisdiction, of his age
discrimination suit. Because Johnson cannot
allege facts sufficient to sustain a cause of ac-
tion against this defendant, we affirm.
I.
Johnson, while fifty-seven years old, at-
tended a job fair in Houston hosted by Aramco
Services Company (“ASC”) and applied
through ASC for a job as a Seismic Field Crew
Supervisor working in Saudi Arabia with
Saudi Arabian Oil Company (“SAO”). SAO is
a Saudi Arabian entity with its principal office
in Dhahran, Saudi Arabia, and ASC, SAO’s
wholly-owned subsidiary, is incorporated in
Delaware. ASC states that it provides SAO
with a range of services, including assistance
with recruiting.
ASC apparently recruitsSSalbeit infrequent-
lySSfor entities other than SAO. Support for
this is found in the record in the form of
ASC’s letter to the Equal Employment Op-
portunity Commission (“EEOC”) in which it
states, “ASC, among others, recruits employ-
ees for positions with the Saudi Arabian Oil
Company (‘Saudi Aramco’) and infrequently
recruits for other entities.” Johnson’s unrefut-
ed affidavit asserts that an ASC employee in-
formed him that ASC acts as a recruiter for
additional entities including its own subsidiar-
ies.
According to Johnson, he was later in-
formed that he would not be selected for the
job, allegedly because of his advanced age. He
filed a complaint with the EEOC, was granted
a right to sue letter, and sued ASC and SAO
alleging, inter alia, violations of the Age
Discrimination in Employment Act (“ADEA”),
29 U.S.C. § 621 et seq. ASC moved for
dismissal based on a lack of subject matter
jurisdiction, pursuant to FED. R. CIV. P. 12-
(b)(1), or alternatively for summary judgment,
arguing “the court cannot apply extra-territori-
ally the ADEA . . . to a foreign corporation
who employs U.S. citizens to work abroad.”1
The district court summarily granted the mo-
tion to dismiss “with prejudice, for lack of
jurisdiction.”
II.
We review de novo a dismissal for want of
subject matter jurisdiction. See Ramming v.
United States, 281 F.3d 158, 161 (5th Cir.
2001).
Lack of subject matter jurisdiction may be
found [o n] any one of [the following bas-
* Pursuant to 5TH CIR. R. 47.5, the court has de-
termined that this opinion should not be published
and is not precedent except under the limited cir-
cumstances set forth in 5TH CIR. R. 47.5.4.
1 That this logic indisputably applies with re-
spect to SAO, Johnson does not disagree, and he
consented to the dismissal of his claims against
SAO.

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3
es]: (1) the complaint alone; (2) the com-
plaint supplemented by undisputed facts
evidenced in the record; or (3) the com-
plaint supplemented by undisputed facts
plus the court’s resolution of disputed facts
. . . . In examining a Rule 12(b)(1) motion,
the district court is empowered to consider
matters of fact which may be in dispute.
Ultimately, a motion to dismiss for lack of
subject matter jurisdiction should be grant-
ed only if it appears certain that the plaintiff
cannot prove any set of facts in support of
his claim that would entitle plaintiff to
relief.
Id.
III.
The ADEA provides, in part, that “[i]t shall
be unlawful for an employment agency to fail
or refuse to refer for employment, or other-
wise to discriminate against, any individual be-
cause of such individual’s age, or to classify or
refer for employment any individual on the
basis of such individual’s age.” 29 U.S.C.
§ 623(b). Bridling this proposition is the no-
tion that no federal statute applies extra-terri-
torially unless Congress has expressly indi-
cated its intent for such an application. See,
e.g., EEOC v. Arabian Am. Oil Co., 499 U.S.
244, 248 (1991). This canon of statutory con-
struction “serves to protect against unintended
clashes between our laws and those of other
nations which could result in international dis-
cord.” Id. The ADEA does not evince any
such intent; to the contrary, the plain language
of § 623(h)(2) generally prohibits such appli-
cations. Age discrimination claims, conse-
quently, are not cognizable with respect to for-
eign corporations who employ American citi-
zens to work aborad.2
Based on the presumption against extra-ter-
ritorial application, even Johnson concedes
that SAO is not a covered employer under the
ADEA. Nevertheless, because ASC is a U.S.
corporation, the same principle does not nec-
essarily immunize it from suit.
Johnson asserts that ASC, functioning as an
employment agency, may be liable for its own
discriminatory practices under 29 U.S.C.
§ 623(b). Johnson’s complaint avers that
ASC, through its screening and referral pro-
cess that classified him according to his age,
violated the ADEASSindependently of SAO’s
discriminatory practices.
ASC correctly notes, however, that SAO is
not a covered employer under the ADEA.
Consequently, goes the argument, recruiting
organizations such as ASC cannot be consid-
ered an employment agency for purposes of
the act if the foreign corporation for whom the
recruiter works is not a covered employer un-
der the ADEA.3
Johnson responds by citing 29 C.F.R.
§ 1625.3, which states that an employment
agency that “regularly procures employees for
2 See Denty v. SmithKline Beecham Corp., 109
F.3d 147, 150 (3d Cir. 1991) (T he ADEA “does
not apply to foreign nationals working for [U.S.]
corporations in a foreign workplace and it does not
apply to foreign companies which are not con-
trolled by U.S. firms.”).
3 See Brownlee v. Lear Siegler Mgmt. Servs.
Corp., 15 F.3d 976, 978 n.3 (10th Cir. 1994);
Shrock v. Altru Nurses Registry, 810 F.2d 658,
660-61 (7th Cir. 1987); Goswami v. Aramco
Servs. Co., No. H-00-0929, slip op. at 12-14 (S.D.
Tex. Mar. 22, 2001).

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at least one covered employer [] qualifies un-
der section 11(c) of the [ADEA] as an em-
ployment agency with respect to all of its ac-
tivities whether or not such activities are for
employers covered by the act.” (Emphasis
added.) Consequently, to the extent the regu-
lation applies, if ASC “regularly” recruits for
any covered employer or employers, the fact
that SAO is not a covered employer will not
immunize it from its conduct with respect to
Johnson.
We need not decide, however, whether
ASC qualifies as an employment agency under
the statute or the regulation. Assuming, for
our purposes, t hat ASC is an employment
agency, subsection (h)(2) absolves it of any lia-
bility under this section.4 It is uncontested that
SAO, the employer, is a foreign person not
controlled by an American employer and that
ASC was procuring employees for SAO to
work in a foreign workplace.5
If we were to apply the regulation, we
would need to determine precisely what is
meant by the phrase “regularly procure.” We
need not do so in this case, however, because
when read in light of Congress’s unequivocal
admonition against extra-territorial application
of the ADEA co ntained in subsection (h)(2),
the regulation cannot impose liability on ASC
where the plain words of the statute exempt it.
In light of the foregoing, Johnson has failed
to allege facts sufficient to sustain an ADEA
cause of action against ASC. The judgment of
dismissal is therefore AFFIRMED.
Treating the petition for rehearing en banc
as a petition for panel rehearing, the petition
for panel rehearing is DENIED. No member
of the panel or judge in regular active service
having requested that the court be polled on
rehearing en banc (FED. R. APP. P. 35 and 5TH
CIR. R. 35), the petition for rehearing en banc
is DENIED. No further petitions for panel re-
hearing or rehearing en banc will be enter-
tained. The mandate shall issue forthwith.
4 Subsection (h)(2) provides that “the prohibi-
tions of this section shall not apply where the em-
ployer is a foreign person not controlled by an
American employer.”
5 See Morelli v. Cedel, 141 F.3d 39, 41-42 (2d
Cir. 1998) (“At a minimum, this provision means
that the ADEA does not apply to the foreign oper-
ations of foreign employersSSunless there is an
American employer behind the scenes.”); Denty v.
SmithKline Beecham Corp., 109 F.3d 147, 150-50
(3d Cir. 1997) (“The language of section 623(h)(2)
could not be more clearSSthe ADEA does not
apply when a foreign corporation controls an
American corporation and the employment is with
the foreign parent abroad.”).

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