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April 2006

Daily Developments in EEO Law
by Paul Mollica (c) 2006

Friday, April 28, 2006

To end the week, here's a nice affirmance of a jury verdict for a Title VII race discrimination plaintiff against the State of Wisconsin (and two superiors, in their individual capacity, under § 1983): Davis v. Wisconsin Dep't of Corrections, No. 05-1946 (7th Cir. Apr. 27, 2006) . It's an especially elegant decision, shorn of any challenge to trial procedure -- the defendants challenge only sufficiency of the evidence under Rule 50 (with a half-hearted stab at a new trial under Rule 59 based on manifest weight of the evidence, snuffed out in a single paragraph at the end of the opinion).

What I especially like about the opinion is how it revives the idea -- feared lost at sea by the plaintiffs' bar -- that on review of denial of judgment as a matter of law under Rule 50, the reviewing court considers only "the evidence favoring the nonmovant as well as that evidence supporting the moving party that is uncontradicted and unimpeached, at least to the extent that evidence comes from disinterested witnesses." Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 150 (2000) (emphasis supplied, citation omitted). What this meant here is that the individual defendants' own testimony, and that of their Department of Corrections (DOC) cohorts, was not placed on the scale in review of the verdict.

The case involved a disciplinary demotion in a correctional setting, recommended by the human resources director (defendant Kathryn Long) and imposed by the warden (defendant Thomas Karlen). Plaintiff Davis, then a sergeant and an African-American, stood accused by a female social worker of sex harassment. Although the ensuing investigation obtained mixed results, Long concluded in a memorandum that Davis violated Work Rule 13, deemed (according to the memo) a "category B" violation. The DOC's internal procedures prescribed only a written reprimand for a one-time category B violation. Two white sergeants who were likewise charged with category B violations (one for repeated acts of unprofessionalism, the other for defacing staff identification photographs) earned no more than a suspension and a reprimand. Yet Davis was demoted instead. Although Long testified that she intended to record a more serious "category C" offense in the Davis memo (which had also been reviewed by Karlen), she discounted the "category B" entry as "a typographical error."

The court, on review, held that a jury could find that a "category B" violation was, by the very terms of the disciplinary policy, "insufficient to motivate his demotion and [] therefore pretextual." The jury could rationally disregard the testimony of DOC witnesses attempting to explain away the disparity in punishments: "The defendants' evidence consisted of their own testimony that they took Davis's conduct seriously, that they thought it was a category C violation, and that the DOC memo contained a typographical error (apparently undetected by Long, Karlen, and the other DOC officials who reviewed it). Of the four witnesses defendants presented at trial, two were defendants Long and Karlen, a third was Steve Dougherty (Boyd's supervisor who assisted Long in investigating Boyd's complaints against Davis), and the fourth was Waters (the equal opportunity program specialist brought in from the DOC's central office who worked with Long throughout the investigation). With the possible exception of Waters, these were not witnesses who could supply the necessary 'independent evidence that no discrimination had occurred.' See Reeves, 530 U.S. at 148."

Tuesday, April 25, 2006

"According to Ms. Powell, Ms. Kreutz propositioned her for sex, sought to convert her to Ms. Kreutz's religion, and spiked her beverage with methamphetamine." Thus launches the compelling workplace odyssey described (though in hardly enough detail) in Powell v. Yellow Book USA, No. 05-2465 (8th Cir. Apr. 25, 2006).

At first, Ms. Powell complained, her co-worker Ms. Kreutz was some kind of crazed party animal: "Ms. Powell points to several instances where Ms. Kreutz talked about her (Ms. Kreutz's) sexual exploits outside the office, described particular fantasies that she harbored concerning co-workers, and propositioned Ms. Powell for sex." But then,

"Soon after Ms. Powell moved to the cubicle next to hers, Ms. Kreutz experienced a religious conversion. She eschewed drugs and alcohol, ultimately becoming a parishioner at the First Assembly of God. Subsequent to her conversion, Ms. Kreutz began to tell Ms. Powell about her religious beliefs. While Ms. Powell was receptive at first, she later told Ms. Kreutz that she did not wish to discuss any more religious matters."

Ms. Powell repeatedly complained to her employer, in turn, about bad-Kreutz and saintly-Kreutz. Finally, feeling thoroughly aggrieved, Ms. Powell took FMLA leave from Yellow Book and never returned.

So how did Ms. Powell's various legal claims fare against her employer (and alleged tormenter, Ms. Kreutz)? The harassment claims under Title VII and state law failed because the district court and court of appeals found that Ms. Kreutz's conduct was not severe or pervasive and that, with the alleged religious harassment, that the employer took prompt and reasonable measures:

"It is true that Ms. Powell continued to complain to Yellow Book management, but in those complaints she repeatedly confirmed that Ms. Kreutz was no longer discussing religious matters with her and instead focused on Ms. Kreutz's religious postings [in her cubicle]. An employer, however, has no legal obligation to suppress any and all religious expression merely because it annoys a single employee."

Retaliation claims based on written reprimands failed for lack of an adverse employment action. Finally, all of the claims about the spiked drink fell out on factual grounds, there evidently being little but speculation about how (if at all) her beverages were contaminated. ("Ms. Powell stated that she would often fall asleep at her desk or that she would daydream while driving home from work. On one occasion, Ms. Powell says that she saw Ms. Kreutz (who worked in the adjoining cubicle) near her desk and Ms. Kreutz's hands 'up by my drink.'")

Monday, April 24, 2006

The EEOC website trumpets the April 19, 2006 issuance of Section 15 of the new Compliance Manual, on "Race and Color Discrimination." Much of the material is familiar, although it is nice to see it updated and compiled in one place. There was one (to me) surprising example that should give employers pause:

"EXAMPLE 14
EDUCATION REQUIREMENT

"Chloe, White, is the Head Secretary for a division of XYZ Corp. She took the job right after college and now is departing after three years to go to graduate school. The employer was thrilled with Chloe's work, and when it gets notice that she is leaving, it sets out to find a replacement. Sylvia, an African American, applies for the job. Sylvia is a successful graduate of the local business institute, and has spent the last five years working as a secretary for a regional bank, rising a year ago to become the Executive Secretary in one of its major departments. The employer rejects Sylvia's application because she is not a college graduate, which triggers a charge. Statistical evidence shows that in the local labor market African Americans and Hispanics in the pool of administrative and clerical workers are significantly less likely to have college degrees than Whites. The employer defends its education requirement by attributing Chloe's success to the fact that she was college educated, noting that the Head Secretary position involves not only traditional secretarial work, but also more complex responsibilities such as preparing reports, and training and supervising other clerical staff. The investigation reveals, however, that none of the firm's prior successful Head Secretaries had college degrees, and it is not the industry standard. Most importantly, the employer presents no evidence that a college degree is more predictive of, or correlated with, job performance than a degree from a business institute plus significant relevant experience (i.e., Sylvia's qualifications), or other credentials and experiences that would render a person qualified for the job. The evidence establishes that the employer has violated Title VII because the college-degree requirement screens out African Americans and Hispanics to a significant degree but it has not been demonstrated to be job related and consistent with business necessity."

This is a disparate impact example, suggesting that any occupational categories not strictly qualified by educational achievement (e.g., dentists, accountants, college professors) may be subject to a disparate impact analysis where an employer expresses a preference for the college-educated. Such preferences are so common and widespread that there are many lawsuits waiting in the wings. The example also suggests that business necessity in disparate impact may be cabined by prior experience or industry norms, which some employees may take as discouraging innovation in defining future occupations.

There is also an example that I think is mistaken, or at least a tad misleading:

"EXAMPLE 21
EMPLOYER LIABLE FOR UNLAWFUL HARASSMENT BY A NON-EMPLOYEE OVER WHOM IT HAS CONTROL

"Charles is a frequent visitor on XYZ Senior Community's 'neighborhood days,' when XYZ allows senior citizens in the neighborhood to visits residents. During his visits, Charles often yells derogatory comments about Blacks and Latinos at Cheryl, a Black employee of Puerto Rican national origin, and has even pushed and tripped her on a few occasions. Cheryl complains about the conduct to a manager, and is told that XYZ cannot take any action against Charles because he is not a resident. On subsequent visits, Charles continues to yell racial and ethnic slurs at Cheryl, and she files an EEOC charge. XYZ is liable for the actions of Charles, a non-employee, because it had the power to control Charles's access to the premises, was aware of Charles's offensive conduct, and did not take corrective action."

The bottom-line result is the correct one. But control over the harasser is irrelevant, because the employer's liability is direct in Title VII cases, rather than derivative of the harasser. Dunn v. Washington County Hospital, 429 F.3d 689, 96 FEP 1647 (7th Cir. 2005).

Finally, there is a short section on retaliation, laying out three "essential elements of a retaliation claim": "Employee Protected Activity," "Employer Adverse Action," and "Causal Connection." The Commission describes "adverse action" as "any adverse treatment (beyond a petty slight or a trivial annoyance) that is based on a retaliatory motive and is reasonably likely to deter protected activity." This may or may not be the standard after the Supreme Court decides Burlington Northern v. White this term, but notably not even the Solicitor General supported this liberal standard in its brief in this case. And the Seventh Circuit abolished the "causal connection" requirement in Stone v. City of Indianapolis Public Utilities Div., 281 F.3d 640, 88 FEP 162 (7th Cir. 2002) , at least at the prima facie stage of the case.

Friday, April 21, 2006

A quick summary of two recent wins for the plaintiff's bar. In the Second Circuit, the panel deciding Baker v. Home Depot, No. 05-1069 (2d Cir. Apr. 19, 2006) (available on the Second Circuit website) vacates and remands summary judgment in a rare Title VII religious reasonable accommodation case (with an assist from amici the EEOC and the American Jewish Congress). The facts are as basic as they come: the employee refuses Sunday duty for religious reasons; for one year, he is successfully accommodated; a new manager arrives on the scene; and the employee is terminated for "unexcused absences" after missing multiple Sunday shifts. The district court held that the store's offer of Sunday mornings off (to attend religious services) constituted a reasonable accommodation as a matter of law. The Second Circuit, in vacating the judgment, found an issue of fact: "It follows that the shift change offered to Baker was no accommodation at all because, although it would allow him to attend morning church services, it would not permit him to observe his religious requirement to abstain from work totally on Sundays." Remaining to be tried is (1) whether other accommodations (such as part-time work or trading shifts) were reasonable; or (2) whether Sundays off for Mr. Baker constitutes an undue burden on the employer, which must now supposedly dragoon other staff to work the weekends. Perhaps the store should hire a Seventh-Day Adventist to balance things out. (The defendant also took aim at the sincerity of Mr. Baker's religious convictions about Sunday work, trying to pick holes in an affidavit submitted by the employee's pastor -- an argument that would never fly in front of an ordinary jury, and which makes no more headway before this appellate tribunal.)

In the Third Circuit, on a 2-1 vote, the panel in reverses summary judgment in a RIF case alleging age discrimination under state law and the ADEA: Tomasso v. Boeing Co., No. 04-4657 (3d Cir. Apr. 19, 2006). Marking this case as distinctive was the Court's frankness that the plaintiff could not entirely rebut several of the reasons proffered by the employer to support his relatively low-performance ranking, which placed him at the front of the line for elimination. Instead, the panel majority summoned the seldom-invoked principle under McDonnell Douglas that a triable issue of fact may be created when the employer's proffered explanation, though true, is insufficient to support the adverse action. "Even if we assume that these rationales adequately explain Tomasso's low scores for 'organizational skills' and 'communications,' a rational factfinder could conclude that they are insufficient to explain Tomasso's low overall score. Although Tomasso received a perfect score of five in 'technical competence,' he received a score of two in 'quality of work,' 'quantity of work,' 'leadership,' and 'attitude.' These low scores remain unexplained. If Tomasso had received higher scores in these or other areas, he would have been ranked high enough to avoid being laid off." Scrutinizing the reasons articulated by the employer, the panel majority exposed enough suspect explanations to demand a trial.

Thursday, April 20, 2006

Here's a second installment of "federal courts of appeals that had their heads handed back to them on remand from the U.S. Supreme Court on a 9-0 vote, Southern Division." Yesterday, we paid a visit to Atlanta, GA, where the Eleventh Circuit conspicuously sidestepped a McDonnell Douglas issue left over from Ash v. Tyson Foods, 126 S. Ct. 1195 (2006).

Today, we shift our attention south and west to the Fifth Circuit (in temporary quarters in Houston, TX). Recently chastened by Arbaugh v. Y & H Corp., 126 S. Ct. 1235 (2006) (holding that the number of employees employed by a Title VII employer is not jurisdictional), the court revisits in Minard vs. ITC Delta Comm Inc, No. 04-30230 (5th Cir. Apr. 18, 2006), whether the statutory definition of "eligible employee" in the Family and Medical Leave Act is jurisdictional or simply an element of the plaintiff's proof. FMLA uses an eccentric conception of employer that requires a map and a compass to work out: it defines an "eligible employee" as not including those "at a worksite" having "less than 50 employees if the total number of employees...within 75 miles of that worksite is less than 50." One smells a whiff of legislative compromise here. Well, anyway, the Fifth Circuit has no problem recognizing that this definition is not jurisdictional, and thus reversing summary judgment in the plaintiff's FMLA retaliation case.

But what really amazes is the secondary holding that defendant ITC may have removed the issue from the case altogether by operation of equitable estoppel, when it behaved as if it were a covered employer. ITC apparently notified employees of their FMLA rights, and granted the employee in this case 12 weeks unpaid leave as per the statute. When sued, though, ITC denied that Ms. Minard was an eligible employee. But as the panel holds, "an employer who without intent to deceive makes a definite but erroneous representation to his employee that she is an 'eligible employee' and entitled to leave under FMLA, and has reason to believe that the employee will rely upon it, may be estopped to assert a defense of non-coverage, if the employee reasonably relies on that representation and takes action thereon to her detriment." In this case, the employee contended that if ITC had made a definite statement that she was not an eligible employee, she would have made alternative arrangements to avoid taking the time off for surgery.

It would seem (to this plaintiff's attorney) that this decision puts the employer that is close to the FMLA definitional line on a razor's edge. If it extends FMLA rights to employees, it may be estopped from denying coverage if sued. If it does not extend FMLA rights and a court later determines that the staff is eligible, defiance of the law will also have adverse consequences.

Wednesday, April 19, 2006

Earlier this term, in a Title VII case originating from the Eleventh Circuit, the U.S. Supreme Court in Ash v. Tyson Foods, 126 S. Ct. 1195 (2006), expunged the pernicious standard that, in a disparate treatment case built on comparative qualifications of employees, "[p]retext can be established through comparing qualifications only when 'the disparity in qualifications is so apparent as virtually to jump off the page and slap you in the face' " (quoting Cooper v. Southern Co., 390 F. 3d 695, 732 (11th Cir. 2004)). Wrote the unanimous Court, "The visual image of words jumping off the page to slap you (presumably a court) in the face is unhelpful and imprecise as an elaboration of the standard for inferring pretext from superior qualifications."

In the first such employment decision published by the Eleventh Circuit since the Ash case -- Brooks v. County Commission, Jefferson Co., No. 05-15201 (11th Cir. Apr. 18, 2006) -- the panel cites Cooper yet again, but this time (it claims) with the Supreme Court's blessing. The plaintiff, a white woman, was passed over for Budget Management Officer by a black candidate. The employer's justification was the latter's superior qualifications and experience. The panel affirms summary judgment, applying the following standard: "A plaintiff must show that the disparities between the successful applicant's and her own qualifications were "of such weight and significance that no reasonable person, in the exercise of impartial judgment, could have chosen the candidate selected over the plaintiff." Cooper v. S. Co., 390 F.3d 695, 732 (11th Cir. 2004), cert. denied, 126 S. Ct. 478 (2005) (citation omitted); see also Ash v. Tyson Foods, Inc., 126 S. Ct. 1195, 1197 (2005) (per curiam) (approving of this language from Cooper)" (emphasis added).

The careful reader will note that the Supreme Court did not exactly "approve" of this language, or any other standard. It instead wrote that "[t]his is not the occasion to define more precisely what standard should govern pretext claims based on superior qualifications. . . . It suffices to say here that some formulation other than the test the Court of Appeals articulated in this case would better ensure that trial courts reach consistent results." But the Eleventh Circuit -- at this juncture, and in an apparently straight-forward case -- chose not do the heavy lifting to craft a new standard; it just took one off the shelf.

Monday, April 17, 2006

An employer conjures a bit of linguistic magic to obtain summary judgment in Sista v. CDC Ixis North America, Inc., No. 05-1506 (2d Cir. Apr. 13, 2006) (located on Second Circuit website). The ADA furnishes an affirmative defense that an employee may be treated adversely if the disability "pose[s] a direct threat" (42 U.S.C. § 12113(b)) to an employee or others. Here, the employee (suffering major depression, subject to outbursts) had a track record of aggressive pronouncements, and the employer even covertly recorded one of his angry phone calls about one manager (Mehta). When his supervisors approached him about taking lead time off, plaintiff "'could not control his mounting agitation' because of his demotion, the circumstances surrounding his demotion, his perception that his job security and livelihood were in jeopardy, and the denial of access to the CDC-taped conversation of his comments about Mehta. As he had done in his earlier meeting with [supervisor] Laier, Sista shouted and cursed during this meeting. While continuing to shout, Sista threatened [supervisor] Nathani. Specifically, Sista threatened: 'If you pulled more than one tape, I swear to Christ . . . I swear to Christ I'm comin' for you.'" He was fired not too long after.

The panel rejected the employer's suggestion that Sista's verbalization of a threat alone was enough to prove the "direct threat" defense. The court held that "[t]he poses a direct threat defense is not applicable when an employee actually makes a threat, despite the common use of the word 'threat'; 'poses a direct threat' is a term of art under the ADA, reserved for circumstances not presented by this case. . . . Here, Sista does not claim that CDC's policies against employee misconduct and threats in the workplace constitute 'qualification standards, tests, or criteria' that 'screen out or tend to screen out' individuals with disabilities; rather, the gravamen of Sista's claim is that he suffered disparate treatment at the hands of CDC when he was fired for being disabled. Accordingly, the 'poses a direct threat' defense has no applicability in this case."

(On the other hand, even without this argument, the employer still prevailed on the alternative ground that the employee failed to raise an inference that the termination decision was motivated by his mental illness, as opposed to his explosive conduct at work.)

Friday, April 14, 2006

The Ninth Circuit -- defying its liberal reputation -- says a collective "no" to a Title VII plaintiff, affirming en banc summary judgment on a casino's make-up and grooming policy that was alleged to place an undue burden on, or to stereotype, female employees. Jesperson v. Harrah's Operating Co., No. 03-15045 (9th Cir. Apr. 14, 2006). (See my December 27, 2004 post on the panel opinion .)

As noted in my prior post, the plaintiff had been a model (the court wrote "exemplary") employee for Harrah's Casino, and for nearly 20 years worked without wearing make-up. Her brief exposure to cosmetics left her feeling "sick, degraded, exposed, and violated." But in April 2000, Harrah's amended its "Personal Best" appearance standard to require woman servers to be made-up for work (but barred men from using make-up at all). Plaintiff neither complied with the directive, nor accepted the company's invitation to accept another position not subject to "Personal Best." (After this suit was filed, the dissent notes, Harrah's shelved the policy.) Harrah's never argued that the policy was a bona fide occupational qualification, but defended that its differential grooming standards for men and women did not violate Title VII.

The eleven judges making up the en banc panel unanimously concluded that the record did not support the undue burden theory, because the plaintiff presented no affidavits or other evidence that the expense or time devoted to complying with the "Personal Best" standards fell more heavily on women. But the court divided on a 7-4 vote on the stereotyping theory. The majority held that the record could not support a theory that "Personal Best" was a plan to shoehorn all servers into "a commonly-accepted stereotypical image of what women should wear." Instead, Jesperson's opposition to summary judgment concentrated entirely on "Jesperson's own subjective reaction to the makeup requirement." As the majority wrote:

"We respect Jespersen's resolve to be true to herself and to the image that she wishes to project to the world. We cannot agree, however, that her objection to the makeup requirement, without more, can give rise to a claim of sex stereotyping under Title VII. If we were to do so, we would come perilously close to holding that every grooming, apparel, or appearance requirement that an individual finds personally offensive, or in conflict with his or her own self image, can create a triable issue of sex discrimination."

But Judge Pregerson's dissent located, at the core of the policy, an employer's mistrust of women's judgment about grooming:

" . . . .Harrah's regarded women as unable to achieve a neat, attractive, and professional appearance without the facial uniform designed by a consultant and required by Harrah's. The inescapable message is that women's undoctored faces compare unfavorably to men's, not because of a physical difference between men's and women's faces, but because of a cultural assumption - and gender-based stereotype - that women's faces are incomplete, unattractive, or unprofessional without full makeup."

Judge Kozinski's separate dissent finally hits this grace note, that could be written in so many employment discrimination cases:

"Finally, I note with dismay the employer's decision to let go a valued, experienced employee who had gained accolades from her customers, over what, in the end, is a trivial matter. Quality employees are difficult to find in any industry and I would think an employer would long hesitate before forcing a loyal, long-time employee to quit over an honest and heartfelt difference of opinion about a matter of personal significance to her. Having won the legal battle, I hope that Harrah's will now do the generous and decent thing by offering Jespersen her job back, and letting her give it her personal best- without the makeup."

(Finally, two facets of Ninth Circuit's procedure stand out in this decision. First, the entire 24-judge circuit does not sit en banc, and a different configuration of eleven judges could easily have come out a different way. Second, two members of the original panel are now senior status and did not sit in the en banc proceeding. The two excluded panelists -- Judges Tashim and Thomas -- signed the original panel and dissenting opinions. Here is the original panel opinion. In the end, the analysis of both the original panel opinion and the dissent were silently rejected by the en banc court.)

Monday, April 10, 2006

May an employer whose management prods a female employee into undressing multiple times before a peeping-tom manager still avoid liability for sex harassment? Apparently yes, in the Eighth Circuit, if the purpose was to bait the manager into exposing his unlawful spying behavior on video. In Cotrill v. MFA, Inc., No. 05-1748 (8th Cir. Apr. 7, 2006), the supervisor (Atkins) remodelled the women's room in Albany, Missouri and built himself a peephole to view the plaintiff. According to the panel majority, "[b]etween 1997 and 2001, Adkins used the peephole to observe Cottrill in the restroom two or three times a day. Cottrill did not know or have any suspicion that Adkins was viewing her through the peephole."

For plaintiff, not knowing about the peephole until 2002 proved to be fatal to her claim for the past four-year period, because she was not subjectively affected by Atkins' behavior. But the employer then devised a plan, when Cotrill finally uncovered Atkins' spying, that it would videotape Atkins one day during Cotrill's trips to the bathroom. She visited the bathroom four separate times that day under Atkins gaze (while on camera). Atkins was only then confronted with the evidence, fired and turned over to the police (later to be prosecuted for invasion of privacy, to which he pled guilty). (There is also evidence about a second women, also a plaintiff, who was incidently a victim of Atkins' spying, and evidence that the plaintiff was deliberately exposed to poison ivy oil spread on the toilet seat; read the opinion for more details.)

The panel majority found that there was no claim of harassment based on the company's recruiting plaintiff to pose in the loo four separate times. "[S]he consented to use the restroom on Monday, she wore a long shirt for protection, her husband other family members were involved in her decision to participate, and she even helped set up the camera in the break room and agreed to its location. In addition, after Adkins was fired, Cottrill continued to work in the Albany facility and to use the women's restroom. Although MFA might have been able to devise a different method of identifying Adkins as the peeper without asking Cottrill to participate, Cottrill admitted in her deposition that MFA did nothing improper between October 17 and October 22."

Dissenting, Judge Murphy thought MFA's investigation itself arguably created a hostile work environment. She noted just how unnecessary it was for Cotrill to disrobe at all. "Janice Schuerman, the vice president responsible for human resources, was notified about the discovery of the peephole and may have been told about the idea of using surveillance equipment. There is no indication in the record, however, that she or anyone from her department was involved in the decision to have Cottrill lure Adkins into peeping by using the restroom four different times while he watched. Instead three male managers with other responsibilities devised the scenario in which Cottrill was required to play an embarrassing and demeaning role, repeatedly serving as bait while engaging in what are normally very private acts (as opposed to combing her hair or checking her makeup, for example), despite the considerable circumstantial evidence that existed about Adkins' surreptitious spying."

Friday, April 7, 2006

I, a one-time defense attorney, bristle at the oft-voiced suggestion (by my cohorts in the plaintiffs' bar) that management firms routinely prolong cases just to gin up their billable hours. But what are we to make of the revelation today in TIG Insurance Co. v. Giffin Winning Cohen & Bodewes, No. No. 05-2203 (7th Cir. Apr. 7, 2006) that a national law firm threw 27 of its lawyers into a Title VII case (which ultimately settled anyway)?

This tidbit emerges from a malpractice case, in which the employer (Illinois State University) hired the Giffin Winning law firm to represent it in a putative class-action suit, Varner v. Illinois State University , alleging discriminatory pay practices. (Plaintiff-Appellant TIG is ISU's insurer.) The Giffin Winning firm bobbled production of equity studies that the employer performed before the litigation began. The employee's lawyer sleuthed out the equity studies and the supposed existence of a database from a former ISU director named Gorrell.

At this point, major-national-law-firm was on the case, with Giffin Winning off in the wings.

Plaintiff's counsel approached the major-national-law-firm, demanding production of the putative database. The panel wrote: "Apparently thinking the best defense is a good offense, [major-national-law-firm]'s first response apparently was to point fingers, saying [plaintiff's counsel] had also not adequately complied with discovery requests. Also at this time, [major-national-law-firm] began preparing a motion to disqualify [plaintiff's counsel] for improperly soliciting privileged information from Gorrell." Apparently, the major-national law-firm may have omitted mentioning to plaintiff's counsel that the database simply did not actually exist.

Cross-motions for sanctions followed (by the plaintiffs for failing to turn over the studies and database, by the defense for alleged ex parte communications), and a four-day hearing ensued. In the end, the judge found that no database ever existed, sanctioned the original defense firm $10,000 (later revoked) and hit the plaintiff's lawyer with a $10,000 sanction to boot. The panel then wrote:

"We now get to the present malpractice action that TIG filed against Giffin Winning in which the damages TIG alleges are the attorney fees it paid [major-national-law-firm] to defend against the sanction motion-a whopping $1.2 million, give or take, for the work of 27 attorneys and various paralegals. It seems that when [major-national-law-firm] said it took the motion seriously, it meant it. As we said, TIG paid the bill and was subsequently reimbursed by its reinsurers."

In the end, the panel affirms summary judgment on the malpractice claim, on the ground that $1.2 million legal tab was not reasonably caused by the first firm's failure to produce documents. It explains:

"In this all-too-common situation, the question for us is whether it would be reasonably foreseeable that a failure to produce these documents would result in the injury alleged here. Could the attorneys foresee that Gorrell, who failed to produce the documents when they turned the request over to him, would then, after he became disgruntled with ISU, independently provide the documents to [plaintiff's counsel]? Beyond that, would reasonable people foresee that Gorrell would mislead [plaintiff's counsel] about a database which did not exist? Would reasonable people then think that, upon hearing Gorrell's story, [plaintiff's counsel]s' first impulse would be to move for sanctions including default judgment in the case? Would reasonable people foresee that, next, a large law firm, apparently thinking of Judge Mihm as a bit trigger-happy, would jump into high gear out of fear of default judgment and launch an army of 27 attorneys, plus paralegals, to defend against the possibility that Judge Mihm might grant default judgment on the basis of an alleged conspiracy to hide something which does not exist? In other words, was the [major-national-law-firm] response to a failure to produce documents and the resulting injury foreseeable?"

The answer is "no," it finds, as a matter of law.

Wednesday, April 5, 2006

Judge Richard Posner's wit and erudition are on display in Tomic v. Catholic Diocese of Peoria, No. 04-4219 (7th Cir. Apr. 4, 2006), reaffirming the orthodox view of the "ministerial exception" that immunizes religious institutions -- or more accurately, withdraws federal jurisdiction -- from claims under labor-protective legislation (here, the ADEA), where the employment falls within the scope of "religious mission." This case involved a church music director; the panel had no trouble pegging this role as ministerial.

The "ministerial exception" has recently been under pressure in other federal courts of appeals. In Elvig v. Calvin Presbyterian Church, 375 F.3d 951 (9th Cir. 2004), a panel (2-1) reversed dismissal of a hostile work environment claim by a female minister, notwithstanding the "ministerial exception." And just six weeks ago, the Second Circuit in Hankins v. Lyght, 438 F.3d 163 (2d Cir. 2006), held (again, 2-1) that the federal Religious Freedom Restoration Act vitiated the common-law ministerial exception to the ADEA, subject to the broad balancing test set out by Congress under that Act, and breathing new life into a minister's suit against mandatory retirement.

Judge Posner's opinion mentions Elvig not at all, while finding unpardonable apostasy in Hankins: "The decision would if sound invalidate the many decisions in this and other circuits recognizing the ministerial exception to federal employment discrimination law. The decision is unsound. RFRA is applicable only to suits to which the government is a party. See 42 U.S.C. §§ 2000bb-1(b), (c). . . ."

And yet, Judge Winter's opinion in Hankins reads the same provisions in RFRA with a different emphasis:

"The statutory language states that it 'applies to all federal law, and the implementation of that law,' 42 U.S.C. § 2000bb-3(a), and that a defendant arguing that such a law substantially burdens the exercise of religion 'may assert [a violation of the RFRA] as a . . . defense in a judicial proceeding.' Id. § 2000bb-1(c). This language easily covers the present action. The only conceivably narrowing language is the phrase immediately following: 'and obtain appropriate relief against a government." Id. However, this language would seem most reasonably read as broadening, rather than narrowing, the rights of a party asserting the RFRA. The narrowing interpretation -- permitting the assertion of the RFR as a defense only when relief is also sought against a governmental party -- involves a convoluted drawing of a hardly inevitable negative implication. If such a limitation was intended, Congress chose a most awkward way of inserting it."

Those who desire the law to stand still in this area will find much to commend in Judge Posner's decision, but his opinion might have contributed more to the dialogue if it had engaged -- not simply interred -- the contrary views.

Tuesday, April 4, 2006

For a public employee, what weight should a court assign (in deciding summary judgment) the finding of a Merit Board hearing officer -- and the Merit Board's order approving the findings -- that the employee gave the more credible account of a supposed workplace infraction? In Goodwin v. Board of Trustees of Univ. of Illinois, No. 04-2961 (7th Cir. Mar. 31, 2006) , the Seventh Circuit winds up assigning this question to the jury.

The employee, a black female foreman, found herself placed on involuntary leave and eventually demoted for allegedly intimidating a subordinate named Gillin (who claimed to have relevant information about an investigation into the foreman's abuse of e-mail). The forman's supervisor, named Kornegay, investigated Gillin's accusation and recommended disciplinary action against Goodwin. Another individual in the investigation, named Hassell, supposedly told her that "People don't like you because, historically, this is a white male position. You are a strong black female, and people don't like that. You dress profession[ally], you are strict and you enforce the rules, and people don't like that."

The employee grieved the discipline, obtained a favorable ruling (with reinstatement and back pay), but did not return to her original position. Instead, she landed an office job without supervisory responsibilities or opportunities for overtime (worth an estimated $10,000 to $15,000). She brought a Title VII, ADE and § 1983 action against the Board.

Reversing summary judgment for the employer, the Seventh Circuit concludes that the hearing officer's credibility findings are evidence of pretext:

"Adding to Goodwin's pretext argument are the circumstances surrounding Gillin's accusation. Gillin had already been disciplined for lying to supervisors, and the substance of his allegation is questionable. Arguably, Goodwin, who had already admitted that the [e-mail] incident occurred and believed that her 'punishment' was a light talking-to and a handout called 'E-mail Etiquette,' would not risk her job to keep Gillin from discussing the incident. Further, if Kornegay actually believed Gillin, the question arises why he did not ask other employees if they had been similarly threatened. Questions such as these apparently led the Merit Board hearing officer, viewing the evidence as a whole, to specifically find that Gillin's allegations were not credible. It is reasonable to assume that a jury might conclude that Kornegay similarly doubted Gillin's veracity. This goes to the heart of Goodwin's pretext argument. It is our judgment that Goodwin has raised a material issue of fact regarding Kornegay's subjective belief in Gillin's allegations."

On the other hand, the Seventh Circuit also concludes that the finding does not quite earn Goodwin the privilege of collateral estoppel. Despite that University of Tennessee v. Elliott, 478 U.S. 788, 797-99 (1986), generally confers issue preclusion upon state administrative fact finding in § 1983 cases such as this one, the panel finds that the Merit Board in this case did not incorporate the hearing officer's finding of facts. Rather, upon review, the Board held only that the hearing officer conducted the hearing in compliance with the law and that the agency failed to meet its burden of establishing just cause for Goodwin's termination. So it appears that the jury gets to hear about the Merit Board's decision, but gets to make its own collective mind up about witness credibility.

 

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