Daily Developments in EEO Law
by Paul Mollica © 2007
Thursday, May 31, 2007
The Eighth Circuit inquires in an ADA case “whether an employer who has an established policy to fill vacant job positions with the most qualified applicant is required to reassign a qualified disabled employee to a vacant position, although the disabled employee is not the most qualified applicant for the position.” To scant surprise, in Huber v. Wal-Mart Stores, No. 06-2238 (8th Cir. May 30, 2007), the answer is “no.” Here the employee obtained summary judgment on liability in a case where an employee with a disabled hand went from an order-filler position (which she could no longer do) to lower-paying janitorial work. Although the employee sought to be employed in a vacant router position, the employer opted for a non-disabled applicant for the job. Was denial of the router job a denial of a reasonable accommodation?
The ADA states the scope of reasonable accommodation may include:
“[J]ob restructuring, part-time or modified work schedules, reassignment to a vacant position, acquisition or modification of equipment or devices, appropriate adjustment or modifications of examinations, training materials or policies, the provision of qualified readers or interpreters, and other similar accommodations for individuals with disabilities.”
42 U.S.C. § 12111(9)(B) (emphasis added). The Tenth Circuit takes the italicized language to mean that disabled employees may obtain a preference in filling vacancies, while the Seventh Circuit finds no such obligation. The Eighth Circuit holds that “the ADA is not an affirmative action statute and does not require an employer to reassign a qualified disabled employee to a vacant position when such a reassignment would violate a legitimate nondiscriminatory policy of the employer to hire the most qualified candidate.”
Meanwhile, last time we heard from Delores Ammons-Lewis, she beat back summary judgment against her employer for Title VII sex discrimination — in particular, a claim that the district gave men adequate restrooms but only gave her a “slop-closet for a restroom” and changing facilities with “peeling paint, a severely puckered floor, a rusted locker with no bottom and no key, no window shade and falling plaster” for a year. Ammons-Lewis v. Metropolitan Water Reclamation Dist. of Greater Chicago, No. 93 C 880, 1997 WL 80949 (N.D. Ill. Feb. 21, 1997). Now she’s back with another suit against the same employer, ten years later, but with an unhappy outcome: Ammons-Lewis v. Metropolitan Water Reclamation District, No. 05-3123 (7th Cir. May 30, 2007). Once again, she persevered through summary judgment, but this time to lose a mixed jury/bench trial on a claim of sex harassment. And regretably, almost all of her claims of trial error — challenges to jury selection, admission of a belatedly-discovered photograph of the witness at a social event with an alleged harasser, production of a defense witness identified (but not fully named) in the pre-trial order, and jury instructions — were either waived below, found not to constitute plain error or simply not error at all.
Wednesday, May 30, 2007
So here’s the decision we’ve been waiting since Thanksgiving to see, Ledbetter v. Goodyear Tire & Rubber Co., Inc., No. 05-1074 (U.S. May 28, 2007) , and it’s difficult to grasp at first why it took so long for Justice Alito to release it. It decides an issue that had split the circuits — when a pay discrimination claim accrues — in a way favorable to employers, but (as we shall see) employers may come to rue what the decision beckons. We also come to learn a bit more of what we can expect from our junior-most associate justice.
Oddly, given that the case originated from a trial on the merits favorable to the employee, we get little flavor of the actual facts that the jury found in Ms. Ledbetter’s favor. Here’s pretty much the entire statement of the record (from page 2 of the opinion):
“In support of [Ledbettter’s Title VII] claim, Ledbetter introduced evidence that during the course of her employment several supervisors had given her poor evaluations because of her sex, that as a result of these evaluations her pay was not increased as much as it would have been if she had been evaluated fairly, and that these past pay decisions continued to affect the amount of her pay throughout her employment. Toward the end of her time with Goodyear, she was being paid significantly less than any of her male colleagues. Goodyear maintained that the evaluations had been nondiscriminatory, but the jury found for Ledbetter and awarded her backpay and damages.”
After citing us to Title VII §§ 706(e)(1) and (f)(1) (42 U.S.C. §§ 2000e-5(e)(1) and (f)(1)), the opinion indicates (at 4) two possible unlawful employment practices suggested by Ms. Ledbetter’s claim — the paychecks themselves seriatim and the last denial of a raise in 1998. Justice Alito writes that neither argument is satisfactory, because “they would require us in effect to jettison the defining element of the legal claim on which her Title VII recovery was based” — namely, “discriminatory intent.” So “central” is intent to the Title VII inquiry that Justice Alito cites us three cases (at 5): an obscure, one-page per curiam decision that says nothing of the sort (Chardon v. Fernandez); the oft-cited Teamsters case, in which the majority allows that intent “can in some situations be inferred from the mere fact of differences in treatment”; and a concurring opinion in Watson v. Ft. Worth Bank & Trust. So already we’ve learned — do not trust the citations!
Justice Alito thus prods us towards a rule that an adverse employment action must not only be caused by discrimination, as the statute provides, but the discriminatory motive must coincide in time with the challenged event: “Ledbetter does not assert that the relevant Goodyear decision makers acted with actual discriminatory intent either when they issued her checks . . . or when they denied her a raise . . . .” (emphasis supplied). So it is suggested that Title VII plaintiffs must show that the employer’s agent manifested the evil intent at essentially the same time as the challenged adverse action during the 180/300 day period (p. 11, n. 3 suggesting only a slight deviation of the formula). If causation rides on temporal proximity alone, instead of other circumstantial evidence (such as a biased pattern of decisions), this could have consequences well beyond pay discrimination claims. A bigoted manager who patiently lies in wait, under this construction of Title VII causation, may eventually get his quarry.
The opinion also punctuates its interpretation of Title VII by accents of certitude (e.g., Ledbetter’s “argument is squarely foreclosed by our precedents”), which sound impressive but are belied by the many courts that heretofore read the governing precedents — Morgan and Bazemore — differently. Cleared of the clutter, the Court faced an honest clash of precedents, Morgan representing the general accrual rule and Bazemore representing the standard for evaluating a challenge to a discriminatory system of compensation. Justice Alito sweeps the challenge aside by construing Bazemore — a case involving the continuation of a racially-dual salary structure in Mississippi — as concerning only a “facially discriminatory pay structure.” We derive this distinction not from Justice Brennan’s opinion itself, but from cobbling together bits and pieces from the Bazemore opinion, the original court of appeals decision and briefs filed in the Bazemore case. So if we don’t like the language from a prior decision, Justice Alito shows that we can construe it away by resorting to secondary materials.
One bright spot may be found at p.23, n.10, in which the majority allows that the Court has never decided “whether Title VII suits are amenable to a discovery rule” (i.e. when the employe knew or should have known), thus leaving for another day the argument that pay disputes may require an employee to be actually be aware of the disparity in compensation with a white/male counterpart.
But now an employee may have to file charges for every injury in the workplace as they occur, such as the mediocre reviews of Ledbetter’s performance, to arrest the running of the limitations clock. Corporate HR types will be forced to respond to myriad charges. And Congress may overturn the entire Ledbetter holding in a trice, with corrective legislation that could be more onerous for employers than the pre-existing limitations rule. As revealed by the experience of the Supreme Court’s 1988-89 civil rights decisions, and the Civil Rights Act of 1991 overturning a half-dozen of those cases in turn, ill-considered 5-4 decisions have a habit of disappointing employers in the long run.
Tuesday, May 29, 2007
For which ever party bears the burden of proof on an issue, that party must make sure the record is complete. Here are two appeals published last Friday, both considering the application of limitations periods, that were determined by the absence of evidence in the record.
Example #1: Harris v. Gonzales, No. 05-5494 (D.C. Cir. May 25, 2007). The employer bears the burden on the affirmative defense of limitations. Although a federal employee has only 45 days from when they learned of discrimination to report it to an EEO counselor, 29 C.F.R. § 1614.105(a)(2) states that “[t]he agency of the [EEOC] shall extend the 45-day time limit . . . when the individual shows that he or she was not notified of the time limits and was not otherwise aware of them . . . or for other reasons considered sufficient . . . .” Federal employers (like their private-sector counterparts) routine meet the notification requirement by posting stock notices in conspicuous locations. But in this case, summary judgment is reversed because the agency failed to make an adequate record.
“Nonetheless, we cannot say that no reasonable jury, viewing the evidence in the light most favorable to Harris and drawing all inferences in her favor, could conclude that she lacked constructive notice of the 45-day requirement. To begin with, the posters themselves are not part of the record, and none of the affidavits includes the posters’ actual language. The affidavits state only that the posters were directed to ‘workers.’ . . . Without the actual text, we have no way of determining whether the posters were ‘reasonably geared’ to notify Harris-an independent contractor-that she was subject to the same 45-day time limit that applies to federal employees, . . .
In addition to failing to recite the posters’ actual language, the affidavits are insufficient to determine whether the posters were displayed in a manner ‘reasonably geared’ to inform Harris of the time limit. For example, the two affidavits asserting that EEO posters were displayed at [the agency] when Harris worked there say only that the posters were displayed in a break room and file room ‘available to all employees and contractors . . . during the period of time that Carla Harris worked [there].” . . . But the mere fact that these rooms were available to contractors-absent information such as the placement of the posters and the number of contractors who entered these rooms, as well as the frequency with which they did so-tells us nothing about the likelihood that Harris herself was ever in these rooms or, if so, whether she should have seen the posters.”
Example #2: Holland v. Sam’s Club, No. 06-1321 (8th Cir. May 25, 2007). The employee alleged inter alia sex harassment, the kind of claim that benefits from the liberal Nat’l R.R. Passenger Corp. v. Morgan, 536 U.S. 101 (2002), continuing violation rule. Sadly though, the employee apparently garbled her presentation in the district court and failed to specify any particular harassing events that occurred within 300 days of her filing the charge. Thus despite that the employer bears the burden on proving limitations, here the court finds that the employee presented no effective rebuttal to the defense. Holland’s Suggestion in Opposition to Defendant’s Motion for Summary Judgment, Holland’s continuing violations argument, in its entirety, stated, ‘there were many acts, thereafter, and inactions, as well, that were a part of the continuing pattern of a hostile work environment’ and ‘[t]he entire record must be considered and that record creates many disputed issues of material fact about the last act of discrimination, the hostile work environment, and the retaliation claim, precluding summary judgment on each of those claims.’ Such general, conclusory, and cursory statements are not sufficient.”
Friday, May 25, 2007
An employer with subsidiaries in Puerto Rico and Mexico loans out an employee from the former to the latter — can she hold the company liable for harassment and other actions occurring in Mexico? Possibly, holds the First Circuit in Torres-Negrón v. Merck & Co., No. 06-1260 (1st Cir. May 23, 2007) , reversing summary judgment and finding that the two companies may be roped together as a common employer.
According to the employee, “from her first day at work in Mexico, she endured continuous harassment and discrimination. She claims that her colleagues at Merck-Mexico made negative and harassing comments about her gender, her U.S. citizenship, her U.S. salary, and her Puerto Rican accent.” Her supervisor, Spinola, singled her out for special mistreatment. But the district court holds that, because the Mexican subsidiary is a separate corporate entity from her full-time Puerto Rico employer, the alleged harassment was (at most) by non-employees and requires plaintiff to show negligence.
On appeal, the defendant suggests that the single-employer doctrine may only apply “to determine whether an entity is an employer under Title VII.” But the panel observes that Merck’s argument proves too much: “Indeed, the very purpose of the doctrine is to extend responsibility for discrimination beyond technical distinctions to promote the Title VII goal of eliminating employment discrimination. . . .The absurd result of [defendant’s] argument is that under such an analysis, Torres’s only bar to invoking the single-employer doctrine would be that she sued her legal employer, as opposed to its parent company.”
The panel ultimately holds that the various factors in the record (the two divisions are in the same line of business, often borrow each others’ employees, maintain common personnel policies and functions, continue control and payment of the employee by the home division, and are jointly owned by the same parent corporation) combine to present at least a genuine issue of material fact as to whether the two divisions constitute a “single employer.”
Tuesday, May 22, 2007
We have two decisions today addressing EEO issues, the first — Matreale v. New Jersey Army National Guard (NJANG), No. 06-2051 (3d Cir. May 22, 2007) — touching on the interplay between state EEO law and the intra-military immunity conferred by Feres v. United States, 340 U.S. 135 (1950), and its progeny. Major Frank Matreale, a commissioned officer in the NJANG, investigated an allegation of sex harassment by a female lieutenant (determined to be founded). He alleged, under the N.J. Law Against Discrimination (NJLAD), “that based on his role in the sexual harassment investigation, . . . NJANG officers subsequently engaged in a course of retaliation against him, including, inter alia, negative performance evaluations and other disciplinary measures based on accusations that he had engaged in an improper superior-subordinate relationship with the female sexual harassment victim . . . .”
The district court granted summary judgment on the ground that the major’s claim was barred by the Feres doctrine, as amplified by Chappell v. Wallace, 462 U.S. 296 (1983) (barring a Bivens action against military officers alleging racial discrimination in assignments, evaluations and punishment). On appeal, the court affirms summary judgment. The major argued that “as a state guardsman, serving under Title 32, he is a state employee suing other state employees, also serving under Title 32, under state law,” thus lifting the case out of Feres. The panel rejoins that “all of whom were serving under orders issued pursuant to 32 U.S.C. § 502(f) at the time of the conduct in question, were serving in a federal capacity and therefore were federal ’employees’ for purposes of the intra-military immunity doctrine.”
Meanwhile in the Fifth Circuit, the court affirms judgment for the employer after an ADA bench trial in Jenkins v. Cleco Power LLC, No. 05-30744 (5th Cir. May 18, 2007). The panel finds that the district court clearly erred in finding that the employee was not substantially limited in the major life activity of sitting (the employee suffered permanent injuries from a fall from a utility pole). But it affirms dismissal of discrimination and retaliation claims, for failing to assign plaintiff to a call center job, on the ground that the employee failed (in the teeth of inconsistent doctor recommendations) to pursue with the employer whether he could in fact perform the job with alternate sitting and standing or other accommodation.
Thursday, May 17, 2007
The Older Workers Benefit Protection Act requires that “a voluntary early retirement incentive plan [be] consistent with the relevant purpose or purposes” of the ADEA (29 U.S.C. § 623(f)(2)(B)(ii))). An employee’s argument in Morgan v. A.G. Edwards & Sons, No. 06-2107 (8th Cir. May 17, 2007) , that the employer’s veiled threat of future termination rendered the plan discriminatory, fails to move the Eighth Circuit (which affirms summary judgment).
When A.G. Edwards offered its cost-cutting Voluntary Severance Incentive Plan (VSIP) to selected employees ages 50 and over, it spindled a memorandum along with the standard OWBPA language and disclosures:
“The [VSIP] will help A.G. Edwards achieve the required cost reductions while rewarding some of the firm’s most long-term employees. We anticipate, however, that A.G. Edwards will implement other initiatives, including involuntary reductions in employment. The decisions concerning involuntary reductions have not yet been made and could be affected by the number of employees who participate in the [VSIP]. Employees eligible for, but who choose not to participate in, the [VSIP] along with other employees may be considered for any involuntary reductions.”
Plaintiff — a regional manager age 59 — declined the offer, but found himself in progressively greater trouble with the company for alleged performance deficiencies (attendance, inaccessibility, failing to visit branches under his management, lack of preparation at an annual meeting). He was demoted, then the parties attempted to negotiate a severance package, but were unable to reach agreement. The employee was eventually terminated for job abandonment. He was replaced in his prior job by a 63-year-old candidate named Medley. In all, not an auspicious start for an age discrimination case.
Morgan tried arguing that the VSIP, directed only at protected-age employees, constituted evidence of an attempt by A.G. Edwards to sweep out its older staff. The panel rejects this suggestion: “Although the memorandum referred to the possibility employees who elected not to participate might be considered for any future involuntary reductions, a reasonable person would not have viewed this language as a coercive threat to ‘quit or be fired.’ Rather, the possibility of involuntary reductions arguably is an obvious and integral corollary of A.G. Edwards’s cost-reduction initiative in the event the company did not achieve its desired goal of reducing costs solely through the VSIP.”
Surveying the rest of the record, the panel also holds that the employee failed to state a prima facie case under McDonnell Douglas (noting his replacement by an older employee) and that testimony by co-workers and underlings about a supposed youth-movement atA.G. Edwards did not constitute “direct” evidence of age discrimination.
Wednesday, May 16, 2007
In Bradshaw v. School Bd. of Broward Co., Fla., No. 06-13182 (11th Cir. May 15, 2007), the court confronts a situation where the jury awards a single damage award in excess of the applicable Title VII cap (here, $300,000), while also finding liability on a supplemental state-law claim to which the excess could be apportioned. In this case, though, the Eleventh Circuit tamps down the plaintiff’s jury award of $500,000 down to the Title VII cap. Why no apportionment? Because the state law award, entered against a public agency, was subject to its own cap: “Neither the state nor its agencies or subdivisions shall be liable to pay a claim or a judgment by any one person which exceeds the sum of $100,000 or any claim or judgment, or portions therefor, which, when totaled with all other claims or judgments paid by the state or its agencies or subdivisions arising out of the same incident or occurrence, exceeds the sum of $200,000.” Reasoning that Florida intends that no damage award against a public employer exceed $100,000, the panel applies the federal cap (citing the Supremacy Clause), but declines the employee’s suggestion to apportion the $100,000 overage to the state-law claim. The panel extends hope, though, that (under a different provision of the same state law) the Florida Legislature may by private bill appropriate Ms. Bradshaw the $100,000 extra compensation.
Meanwhile, in the Eighth Circuit, the court refuses to revive an ADA claim (despite an amicus effort by the EEOC on behalf of the employee): Rehrs v. The Iams Company, No. 06-1609 (8th Cir. May 15, 2007). The key issue was whether shift rotation on a packaging plant line was an “essential function” of the employee’s job that could not be accommodated by maintaining him in a straight shift (owing to his need for regular hours, to maintain his diabetes regimen). The employer argues that it cannot maintain him on the same shift without hardship to his co-workers, and the panel finds no genuine issue of material fact on this issue. That the plant used to operate on straight shifts does not impugn the employer’s motive: “Rehrs argues the plant operated on a straight-shift schedule before [Procter & Gamble’s] acquisition of the plant and again after P&G outsourced the facility to Excel, while all other functions of the facility, with the exception of the shift rotation, remained the same. However, as the district court noted, the fact that straight shifts were in effect at the Aurora facility before and after P&G ran the facility has little relevance. P&G does not have to exercise the same business judgment as other employers who may believe a straight shift is more productive. It is not the province of the court to question the legitimate operation of a production facility or determine what is the most productive or efficient shift schedule for a facility.”
Tuesday, May 15, 2007
Things were quiet last week on the EEO front, but I have a few developments to report from yesterday favorable to employees.
Last night, the Tenth Circuit issued an excellent decision in EEOC v. PVNF, LLC d/b/a Big Valley Auto and Chuck Daggett Motors (CDM), No. 06-2011 (10th Cir. May 14, 2007), reversing (in part) a judgment as a matter of law in a Title VII sex harassment case. According to the trial record, over a four-month period, the majority owner (Mr. Carter) demeaned the abilities of female employees, said that pregnant women belonged home and that child-care issues were a drag on the office. He supposedly made remarks about the nipples of Mexican women supposedly changed color after a pregnancy. He said that he didn’t want women as sales staff and said that, to succeed, women needed to be “bitches.” He also supposedly took the men’s side in disputes.
Co-workers supposedly also joined in the harassment. One fight between a woman salesperson and a male co-worker culminated her being called “bitch” and the man throwing a plate against a wall. The opinion quotes at length an appalling e-mail sent among some of the men describing a female employee sexually. Complaints to the management were at best met with no assistance at all, or else female employees were told to get back to work and that they could not take a joke.
Eventually, one of the claimants named Ms. Segovia resigned (after being given a warning and placed on a disadvantageous pay plan), and filed a charge with the EEOC. The EEOC filed a case for two women (one eventually dismissed). The jury heard the Commission’s case for Ms. Segovia Alleging harassment, discrimination and retaliation. The district court granted judgment as a matter of law after the Commission rested.
On appeal, the panel sends the harassment claim back for a new trial. The district court had found the conduct alleged was not severe or pervasive, but the panel faults the judge for breaking apart the individual incidents and not perceiving the cumulative effect of the bad behavior. It also challenges the judge’s holdings that the Commission exaggerated or “sensational[ized]” the evidence, especially the e-mail. Summing up, the panel states:
“The majority owner of the dealership repeatedly subjected her (and others) to comments about a woman’s ‘appropriate’ role in the workplace; her co-workers used sexual epithets to describe her (on one such occasion she felt physically threatened when a coworker threw a plate against a wall); and she intercepted a vulgar e-mail describing her genitalia that was written by one of her subordinates, addressed to another manager, and forwarded on to her supervisor. Moreover, her supervisor knew about all this conduct and either chose to ignore it altogether or respond in only the most minimal of ways (e.g., forcing a half-hearted apology).”
The panel affirms JMOL for the balance of the claims.
In Jakimas v. Hoffman-La Roche, No. 06-2399 (3d Cir. May 14, 2007), the Third Circuit decides several important issues relating to ERISA claims for retaliatory termination. First, the court holds that under ERISA § 510 (29 U.S.C. § 1140) — the anti-retaliation section — the claim accrues when employees learn of an intended adverse action (here, a mass termination owing to the closure of a business unit of Roche), following the Seventh and First Circuits. The court affirms summary judgment on timing grounds where the employees either admitted to actual notice of the termination beyond the two-year limitations period (borrowed from New Jersey law), or else attended meetings or received letters where the terminations were announced. Second, as to one non-time-barred plaintiff who nevertheless signed a release, the panel finds that genuine issues of material fact preclude summary judgment where the employee might have been misinformed about the tax consequences of rolling over his 401(k). The court also breaks with other circuits (the First and Fifth) and holds that the putative releasing party need not return the consideration (i.e. tender back) to challenge the validity of the release (citing a venerable FLSA decision, Hogue v. Southern R. Co ., 390 U.S. 516 (1968)). Ultimately, though, the remaining plaintiff loses on the merits (and a supplemental claim based on state law age discrimination flames out as well).
Finally, in a too-sweet decision against a major defense law firm, the employee beats an arbitration agreement in Davis v. O’Melveny & Myers, No. 04-56039 (9th Cir. May 14, 2007) and wins her day in court. The panel reverses the district court (which compelled arbitration) and finds the contract procedurally and substantively unconscionable. It singles out four provisions for dishonor: (1) a “notice” provision, requiring the claimant to furnish written notice and a demand for mediation within one year of the challenged event, which would nullify any continuing-violations theory; (2) a confidentiality provision so tight that an employee could not even investigate her claim or obtain witnesses; (3) an overly-broad “business justification” provision, which exempted from arbitration claims that the law firm might bring against employees for disclosure of confidential or privileged information; and (4) a ban on pursing administrative actions through a public agency. The panel also holds that the four unconscionable provisions cannot be severed from the rest of the agreement.
Friday, May 4, 2007
Two victories for plaintiffs to report at week’s end.
Issacs v. Hill’s Pet Nutrition, No. 06-2201 (7th Cir. May 4, 2007) — involving a hostile work environment at a pet food plant — the court reverses summary judgment and, along the way, dispatches with an argument commonly made by employers in these cases. The employer contended that the employee did not suffer one single campaign of harassment, but two separate events. Breaking up the harassment into separate events leads to a defense that the more recent harassment cannot be linked to the prior events for a continuing violation under Morgan . The panel does not bite:
“When deciding that Isaacs experienced two distinct episodes of hostile work environment, the district court concentrated on the identities of her harassers. One group of men made life hard for her in Packaging; a different group vexed her in Stretchwrap. But why should this matter? Isaacs has not sued her co-workers; the entity responsible for complying with Title VII is the employer, of which Isaacs had just one. And employers are not vicariously responsible for misconduct in the workplace; employers are responsible for their own conduct (or omissions)-which is to say, for how they respond (or fail to respond) after receiving notice that an employee may be suffering from disparate treatment at co-workers’ hands.”
“An employee moved from one plant to another, where a different set of managers made decisions about working conditions, might well experience different hostile environments for the purpose of Morgan. As long as the employee remains within a single chain of command, however, and the same people control how the employer addresses problems in the workplace, there is only one employment practice, and all events may be considered (subject to the possibility of laches) to determine whether that employment practice violates Title VII. Isaacs therefore is entitled to present for consideration her treatment throughout her employment at Hill’s Pet Nutrition.”
The panel also finds a triable issue of fact about the company’s response to the harassment, finding that “As Isaacs related events, she complained repeatedly to supervisors and management-level personnel at Hill’s Pet Nutrition about how the men were treating her, and she received the same response every time: one or another variation on ‘grin and bear it.’ The employer’s approach thus remained constant. Doing nothing after receiving multiple complaints about serious conditions is a straight road to liability under Title VII.”
And yesterday, the Fourth Circuit graced the plaintiff’s bar with a rare win: Aleman v. Chugach Support Services, No. 06-1461 (4th Cir. May 3, 2007). The court reverses summary judgment for one plaintiff for a race discrimination and retaliation case brought under section 1981 against a native Alaskan-owned corporation. The court holds that although Alaska Native Corporations, 43 U.S.C. § 1626(g) (2000), and Indian tribes, 42 U.S.C. § 2000e(b), are exempt parties under Title VII, that statutory immunity does not extend to a section 1981 claim, which contains no such exemption. Moreover, the court rejects the employer’s argument that section 1981 does not contain or allow a remedy for retaliation. “Under [Supreme Court and Fourth Circuit] precedents, plaintiffs such as Blasic can challenge as discriminatory actions that were taken against them for reporting unlawful discrimination, even if the plaintiffs were not subject to discrimination based upon their own race, gender, or similar protected status.” Two other plaintiffs, though, are required to arbitrate their discrimination claims under a collective bargaining agreement, which the court holds clearly and unmistakably consigns all workplace discrimination claims to the grievance process.
Wednesday, May 2, 2007
Eichorn v. AT&T Corp., No. 05-5461 (3d Cir. May 2, 2007), reviewing a putative class action under ERISA § 510 (29 U.S.C. § 1140), affirms summary judgment for the employer. In this case, the employees alleged — in the spin-off of an AT&T division — that their bridging rights for pension were cancelled, thus interfering with their right to benefits. While summary judgment was previously reversed by the Third Circuit on liability (Eichorn v. AT&T Corp., 248 F.3d 131 (3d Cir.), cert. denied , 534 U.S. 1014 (2001)), the plaintiffs finally lose after ten years of litigation on the issue of remedy.
Plaintiffs sought two kinds of remedy. The first was purely compensatory, monetary relief for the lost benefits. Unfortunately for plaintiffs, the only proof of the value of the lost benefits were “spreadsheets … prepared by plaintiffs’ counsel’s son, Stephen Crowley, who was not offered as an expert and has no training or experience with the economics of employment benefits.” These spreadsheets the court struck on the ground that Crowley was not qualified as an expert (FRE701 and 702), and alternatively that the spreadsheets were not FRE1006 summaries. On the latter ground, the Court observed,
“[P]laintiffs’ proffered calculations are better described as a synthesis rather than a summary of the charts and other evidence on which Mr. Crowley relied. The calculations went beyond the data they summarized and included several assumptions, inferences, and projections about future events, which represent Mr. Crowley’s opinion, rather than the underlying information. The proposed evidence is thus subject to the rules governing opinion testimony and was properly held inadmissible.”
The second remedy, “appropriate equitable relief” (under ERISA § 502(a)(3)), failed because the remedy sought was — in effect — legal relief not authorized by this section:
“[T]he plaintiffs sought a decree from the District Court requiring Lucent to adjust its pension records retroactively to create an obligation to pay the plaintiffs more money, both in the past and going forward. The District Court rightly saw this as being, in essence, a request for compensatory damages merely framed as an ‘equitable’ injunction.”
The panel held that because the plaintiffs sought “pension benefits for work they never did for AT&T or its former divisions, but which they argue they might have done had AT&T not adopted a hiring policy that they claim violated ERISA,” the employees effectively sought back pay, which was also legal relief. The Third Circuit thus became the second U.S. Court of Appeals to hold that there is no back-pay remedy for termination under ERISA § 510.