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Walsh v. Bank of America, No. 08-2230 (3d Cir. Mar. 30, 2009); Hunt v. Imperial Merchant Services, Inc., No. 07-16418 (9th Cir. Mar. 31, 2009)


The Third Circuit, in an unpublished decision, reverses summary judgment on an ADA/Pennsylvania Human Rights Act claim on the issue of whether the employee was (or was regarded by his employer as) "disabled" with Post-Traumatic Stress Disorder (PTSD).  The Ninth Circuit affirms an interlocutory order by Judge Jenkins (of Dukes v. Wal-Mart fame) ordering defendant to pay the costs of notice in a Fair Debt Collection Practices Act class case. 

Walsh v. Bank of America, No. 08-2230 (3d Cir. Mar. 30, 2009):  In this case, the district court held that the employee had failed to present a genuine issue of material fact about whether his supervisors were aware of his diagnosis of PTSD when they fired him.  The Third Circuit reverses, holding that the district court erred in finding that the employee's declaration in opposition to the motion contradicted his deposition testimony.  The issue specifically was whether he informed a decision-maker named Jim Bell of his condition.  The employee, consistent with his deposition, testified that he had told him.  Though there was an apparent lapse in memory during the deposition, the panel found that it was illusory:

"Walsh was asked, 'Now in your conversation with Jim Bell, other than telling him that you might have to go to Lyons, did you tell him that you have PTSD?'  (Id.)  Walsh responded, 'I don’t recall telling him that.' (Id.)  This apparent contradiction is cleared up, however, by a later question in the deposition, when Walsh was asked, 'Now, other than Mr. Bell and Maureen Williamson, did you tell anyone else at Fleet or Bank of America that you had PTSD?'.  (App. at 347.)  Walsh responded that he had also told Ms. Schultz about his PTSD, but the question itself seems to indicate that both Walsh and the BOA attorney asking the question clearly understood that Walsh had told Jim Bell about his PTSD."

 

In addition, the record contained other evidence supporting an inference that the employer at least regarded Walsh as disabled, including a notation in his personnel file ("Disabled Vietnam Veteran").  "Walsh also testified that he asked several times to work only six hours a day because of his PTSD and filled out the necessary forms three times.  (App. at 429.)  He says that he was told by his supervisors at BOA that he would be given an accommodation but he was never moved to a six-hour work day.  (App. at 428-29.) "

 

Hunt v. Imperial Merchant Services, Inc., No. 07-16418 (9th Cir. Mar. 31, 2009):  The Supreme Court, in such cases as Oppenheimer Fund, Inc. v. Sanders, 437 U.S. 340, 359 (1978), and Eisen v. Carlisle & Jacquelin, 417 U.S. 156, 171-72 (1974), has ordinarily required the class representative/counsel to shoulder the cost of sending notice in a certified Rule 23 class case.  Though there has been some district court authority shifting that burden to defendants in unusual circumstances, up until now (so far as I know) there has been no published federal court of appeals authority supporting this practice.

 

In this case, though, the class won on the merits, coincidentally with certification:

 

"The district court granted Hunt partial summary judgment on liability in March 2007, concluding that IMS’ collection efforts violated California law and thus the FDCPA. In a separate order filed the same day, the district court certified two subclasses under Federal Rules of Civil Procedure ('Rule') 23(b)(2) and 23(b)(3), with Hunt and Castillo as named plaintiffs."

 

As an interlocutory appeal proceeded on the merits of the case (still pending, while the California Supreme Court decides a certified question), the district court ordered that the defendant pay for notice to the class, in recognition of the class's status as a prevailing party.  (The district court stayed the order pending appeal and the plaintiffs paid this stage before one Ninth Circuit panel.  When defendant appealed the costs order, it wound up before a second panel.

 

The Ninth Circuit affirms. After finding jurisdiction to review the order under the "collateral order doctrine," and rejecting an argument that the appeal might be mooted by a reversal of the merits decision, it then considers two issues related to the costs.  The first was whether the district court had the power to shift the costs.  Analogizing to the widely-accepted practice of awarding interim attorneys fees, the panel holds "that a district court in an appropriate case may award interim costs to a plaintiff by shifting class notice costs to a defendant even if the defendant might later be entitled to recover those costs."

 

Second, the panel weighs whether the district court abused its discretion in shifting the costs of notice:

 

"We hold that once the district court determined that IMS was liable on the merits, it had the discretion to shift the notice costs to IMS. Stated another way, the district court had discretion to choose not to impose on Hunt the burden of first advancing notice costs and then trying to recover those costs from IMS after a final judgment. We perceive no solution here that can avoid risk to both parties, and accordingly we think the proper placement of notice costs is best left to the sound discretion of district courts, once liability on the merits has been determined in the first instance. In such circumstances, the district courts are not required in all cases to shift notice costs but instead may consider the totality of circumstances to decide whether shifting notice costs is just in that particular case."

 

Useful decision in statutory cases such as this one, where liability is susceptible to summary disposition.

 

 

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