Casenote(s):
FAIR LABOR STANDARD ANTI-RETALIATION PROVISIONS AT § 215(a)(3) (OVERTIME) AND § 218c (AFFORDABLE CARE ACT); ADJUNCT FACULTY MEMBER FOUND TO BE AN EXEMPT TEACHER; COMPLAINTS ABOUT OVERTIME AND ACCESS TO HEALTH INSURANCE WERE NOT OBJECTIVELY REASONABLE WHERE COMPLAINANT WAS FACTUALLY EXEMPT UNDER THE STATUTE, AND HAD BEEN SO INFORMED BY DEFENDANT’S HUMAN RESOURCES REPRESENTATIVE
In Keith v. Univ. of Miami, No. 19-21229 (S.D. Fla. Jan. 27, 2020) (2020 U.S. Dist. LEXIS 14796; 2020 WL 810526), Plaintiff, who was employed by Defendant as an Adjunct Faculty member, filed an action pursuant to the anti-retaliation provisions of the Fair Labor Standards Act of 1938 (FLSA) at 29 U.S.C. § 215(a)(3) (overtime) and 29 U.S.C. § 218c (Affordable Care Act - ACA). As an Adjunct Faculty member, Plaintiff was classified as a part-time employee paid by the hour, and was not entitled to enroll in Defendant’s ACA group health insurance policy. Plaintiff alleged that she was only compensated for hours teaching classes and not for time preparing for classes or engaging in administrative duties. She asked, and later demanded, to be promoted to a full-time position to enable her to enroll in the ACA policy. She also demanded payment for the extra “overtime” hours. Plaintiff believed that she was a FLSA covered employee because she was paid by the hour and not with a salary. Defendant’s HR representative informed Plaintiff that because she was a teacher she was exempt from the FLSA minimum wage and overtime provisions, and that because of the number of hours Plaintiff spent in class she did not qualify for ACA coverage. Plaintiff was fired less than a month later. Plaintiff alleged in an amended complaint that she was fired for complaining about entitlement to overtime compensation and health insurance. Defendants filed a motion to dismiss.
The court noted that the FLSA overtime provisions “do not apply to employees employed in a bona fide executive, administrative or professional capacity. See 29 U.S.C. § 213(a)(1). Pursuant to § 213(a)(1), the FLSA recognizes teachers as exempt professionals.” Accordingly, even Plaintiff was an hourly employee and not paid a salary, she could not maintain the § 215(a)(3) action because she “was employed by Defendants as a teacher exempt from the overtime pay requirements of the FLSA. See 29 C.F.R. § 541.303.” Slip op. at 6.
Plaintiff argued that Defendants nonetheless violated the FLSA’s anti-retaliation provision because her reasonable, good faith complaints about her part-time status and inability to enroll in the healthcare program were the basis for her termination. The court noted that “[g]enerally, complaints of legal activity can still be protected if the employee has an objectively reasonable, good faith belief that the employer’s conduct is unlawful. This standard requires the employee show that she subjectively, that is in good faith, believed that her employer was violating the law. Little v. United Techs. Carrier Transicold Div., 103 F.3d 956, 960 (11th Cir. 1997) (decided under Title VII anti-retaliation provision).” Id. at 7. The court found, however, that Plaintiff could not establish that she had an “objectively reasonable belief” that her “employer was engaged in unlawful practices.” Id. The court determined that even if Plaintiff did not know of her exempt status at the time of her complaint, it was an undisputed fact and she was informed of her exempt status by the HR representative. The court further stated:
Where, as here, Plaintiff was explicitly exempt and therefore not covered by the FLSA, the court concludes no reasonable employer, given the context and content, could have perceived her complaint as a genuine assertion of rights under the FLSA. With very clear language, Congress exempted Plaintiff from FLSA’s protections, so it is difficult to conceive how her complaint could be “under or related to” FLSA such that she raises a cognizable FLSA retaliation claim. 29 U.S.C. § 215(a)(3). Moreover, Plaintiff points to no case, and the Court has not on its own identified any, in which an employee clearly and explicitly exempted from FLSA coverage has successfully raised an FLSA retaliation claim.
The court determined that because Plaintiff was explicitly exempt and not covered by the FLSA, her cause of action under the FLSA was futile. The court thus dismissed the case with prejudice.
[Editor’s note: The court did not specifically discuss Plaintiff’s exempt status vis-à-vis the ACA provision at § 218c, although its dismissal of the action implies that the court considered the exempt status determinative both of the retaliation claims]
Related USDOL Case: ALJ No. 2016-AIR-00028
Casenote(s):
PROCEDURE BEFORE DISTRICT COURT; MOTION FOR STAY BASED ON POTENTIAL PRECLUSIVE EFFECT OF ALJ’S FACTUAL FINDINGS IN AIR21 CASE WHICH WAS PENDING REVIEW BY THE ARB; COURT DENIES STAY OF TRIAL PREPARATION IN VIEW OF THE UNCERTAINTY OF THE RESOLUTION OF THE DOL PROCEEDINGS, BUT WOULD ALLOW A MOTION FOR APPROPRIATE RELIEF ONCE THE ALJ’S DECISION IS FINAL AND THE CONTOURS OF THE ISSUES ARE MORE CLEARLY DEFINED, OR, FOR DEFENDANTS TO RENEW REQUEST FOR A STAY IF THE ARB HAS NOT RULED BY THE TIME THE TRIAL IS SCHEDULED TO BEGIN
In Kreb v. Jacksons Food Stores, No. 16-cv-00444 (D. Idaho Jan. 30, 2020) (2020 U.S. Dist. LEXIS 16542; 2020 WL 497156), Defendants moved to stay the proceedings in federal district court on the ground of the potential preclusive effect of a DOL ALJ’s decision in a related AIR21 retaliation case. In that case the ALJ found that Plaintiff had not made a certain safety report in good faith and that it was objectively reasonable. The ALJ’s decision was pending on appeal before the ARB, and Defendants argued that if the ALJ’s decision is upheld it will have preclusive effect on critical issues in the matter before the district court. The district court denied the motion. The court stated:
Here, the potential preclusive effect of ALJ Morris’s decision is naturally dependent upon the outcome of Plaintiff’s currently-outstanding Petition for Review. Those potential shifting sands are good reason for the Court to not issue a conditional ruling premised on an assumption that the ARB upholds ALJ Morris’s decision, especially as to possible evidentiary implications arising therefrom, including whether portions of Plaintiff’s expert’s opinions are (or would be) improper in light of such an assumed outcome. Once the review of ALJ Morris’s decision is final and the contours of these issues are more clearly defined, the parties may move the Court for appropriate relief on the more certain landscape.
It is true that a stay would permit things to unfold without the parties having to prepare for trial while awaiting the ARB’s consideration of Plaintiff’s Petition for Review. But, the practical effect of all this is that, since July 2019 when the Jackson Defendants filed their Motion, there has been a de facto stay of sorts with virtually nothing happening in the interim. Moreover, the claimed wrongs occurred in July 2014. And, regardless of how the ARB decides, Plaintiff’s underlying claims will proceed — this is not a situation where his case completely dissolves if the ARB rules a certain way.
This is to say that the controversy between the parties needs to move forward toward a resolution, regardless of what forum it moves forward in and regardless of the potential for some unevenness along the way. The alternative is for nothing to move forward at all, while awaiting the uncertain date when there is a decision from the ARB. Such a course is not appropriate under FRCP 1. See Fed. R. Civ. P. 1 (Federal Rules of Civil Procedure “should be construed, administered, and employed by the court and the parties to secure the just, speedy, and inexpensive determination of every action and proceeding.”).
The Court therefore concludes that the balance of equities weigh against the Jackson Defendants’ request under the existing circumstances. If the ARB has not acted on Plaintiff’s Petition for Review by the time trial is scheduled to begin, the Jackson Defendants’ may renew their request for a stay; until then, the Court will not postpone trial preparation simply due to the Petition for Review
Slip op. at 3-4.
Casenote(s):
FAIR LABOR STANDARD ANTI-RETALIATION PROVISIONS AT § 215(a)(3) (OVERTIME) AND § 218c (AFFORDABLE CARE ACT); ADJUNCT FACULTY MEMBER FOUND TO BE AN EXEMPT TEACHER; COMPLAINTS ABOUT OVERTIME AND ACCESS TO HEALTH INSURANCE WERE NOT OBJECTIVELY REASONABLE WHERE COMPLAINANT WAS FACTUALLY EXEMPT UNDER THE STATUTE, AND HAD BEEN SO INFORMED BY DEFENDANT’S HUMAN RESOURCES REPRESENTATIVE
In Keith v. Univ. of Miami, No. 19-21229 (S.D. Fla. Jan. 27, 2020) (2020 U.S. Dist. LEXIS 14796; 2020 WL 810526), Plaintiff, who was employed by Defendant as an Adjunct Faculty member, filed an action pursuant to the anti-retaliation provisions of the Fair Labor Standards Act of 1938 (FLSA) at 29 U.S.C. § 215(a)(3) (overtime) and 29 U.S.C. § 218c (Affordable Care Act - ACA). As an Adjunct Faculty member, Plaintiff was classified as a part-time employee paid by the hour, and was not entitled to enroll in Defendant’s ACA group health insurance policy. Plaintiff alleged that she was only compensated for hours teaching classes and not for time preparing for classes or engaging in administrative duties. She asked, and later demanded, to be promoted to a full-time position to enable her to enroll in the ACA policy. She also demanded payment for the extra “overtime” hours. Plaintiff believed that she was a FLSA covered employee because she was paid by the hour and not with a salary. Defendant’s HR representative informed Plaintiff that because she was a teacher she was exempt from the FLSA minimum wage and overtime provisions, and that because of the number of hours Plaintiff spent in class she did not qualify for ACA coverage. Plaintiff was fired less than a month later. Plaintiff alleged in an amended complaint that she was fired for complaining about entitlement to overtime compensation and health insurance. Defendants filed a motion to dismiss.
The court noted that the FLSA overtime provisions “do not apply to employees employed in a bona fide executive, administrative or professional capacity. See 29 U.S.C. § 213(a)(1). Pursuant to § 213(a)(1), the FLSA recognizes teachers as exempt professionals.” Accordingly, even Plaintiff was an hourly employee and not paid a salary, she could not maintain the § 215(a)(3) action because she “was employed by Defendants as a teacher exempt from the overtime pay requirements of the FLSA. See 29 C.F.R. § 541.303.” Slip op. at 6.
Plaintiff argued that Defendants nonetheless violated the FLSA’s anti-retaliation provision because her reasonable, good faith complaints about her part-time status and inability to enroll in the healthcare program were the basis for her termination. The court noted that “[g]enerally, complaints of legal activity can still be protected if the employee has an objectively reasonable, good faith belief that the employer’s conduct is unlawful. This standard requires the employee show that she subjectively, that is in good faith, believed that her employer was violating the law. Little v. United Techs. Carrier Transicold Div., 103 F.3d 956, 960 (11th Cir. 1997) (decided under Title VII anti-retaliation provision).” Id. at 7. The court found, however, that Plaintiff could not establish that she had an “objectively reasonable belief” that her “employer was engaged in unlawful practices.” Id. The court determined that even if Plaintiff did not know of her exempt status at the time of her complaint, it was an undisputed fact and she was informed of her exempt status by the HR representative. The court further stated:
Where, as here, Plaintiff was explicitly exempt and therefore not covered by the FLSA, the court concludes no reasonable employer, given the context and content, could have perceived her complaint as a genuine assertion of rights under the FLSA. With very clear language, Congress exempted Plaintiff from FLSA’s protections, so it is difficult to conceive how her complaint could be “under or related to” FLSA such that she raises a cognizable FLSA retaliation claim. 29 U.S.C. § 215(a)(3). Moreover, Plaintiff points to no case, and the Court has not on its own identified any, in which an employee clearly and explicitly exempted from FLSA coverage has successfully raised an FLSA retaliation claim.
The court determined that because Plaintiff was explicitly exempt and not covered by the FLSA, her cause of action under the FLSA was futile. The court thus dismissed the case with prejudice.
[Editor’s note: The court did not specifically discuss Plaintiff’s exempt status vis-à-vis the ACA provision at § 218c, although its dismissal of the action implies that the court considered the exempt status determinative both of the retaliation claims]
Case below: Williams v. Metro N. R.R., 2019 U.S. Dist. LEXIS 59278 (S.D.N.Y., Apr. 4, 2019)
Casenote(s):
PROTECTED ACTIVITY; FRCP 12(b)(6) MOTION TO DISMISS GRANTED WHERE SUBJECTIVELY AND OBJECTIVELY REASONABLE STANDARD NOT PLAUSIBLY PLEADED; PLAINTIFF DID NOT EXPLAIN WHY HIS ADMONISHMENT OF A CO-WORKER FOR UNSANITARY CLEANING METHODS AMOUNTED TO “A HAZARDOUS SAFETY OR SECURITY CONDITION” WITHIN THE MEANING OF THE FRSA
In Williams v. Metro-North R.R., Nos. 17-CV-3092, 17-CV-9167, 18-CV-7793, 17-CV-7758, 18-CV-8350 (S.D. N.Y. Mar. 27, 2020) (2020 U.S. Dist. LEXIS 53914) (Opinion and Order), Plaintiff, who was a coach cleaner for Metro-North, filed pro se a series of actions, one count of which was a FRSA retaliation claim.
The court granted Defendants’ FRCP 12(b)(6) motion to dismiss the FRSA count on the ground that Plaintiff had not plausibly alleged facts suggesting that “a hazardous safety or security condition” existed or that he reported such a condition. The court explained: “On the contrary, Plaintiff claims only that he admonished [a co-worker] for improperly cleaning a bloody tampon. . . . While an improperly cleaned tampon may be unsanitary, Plaintiff does not explain why it would be reasonable for him to believe that [the co-worker’s] conduct amounted to ’a hazardous safety or security condition’ within the meaning of the FRSA. See Ziparo v. CSX Transp., Inc., No. 17-CV-708, 2020 WL 1140663, at *17-18 (N.D.N.Y. Mar. 9, 2020) (requiring that a plaintiff’s good faith belief in the existence of a safety hazard be ’objectively reasonable’); March v. Metro-North R.R. Co., 369 F. Supp. 3d 525, 533 (S.D.N.Y. 2019) (same). On the contrary, cleaning such materials appears to be precisely within the purview of Plaintiff’s role as a car cleaner.” The dismissal was without prejudice to file an amended complaint to correct the deficiencies.
CONTRIBUTORY FACTOR CAUSATION; FRCP 12(b)(6) MOTION TO DISMISS GRANTED WHERE COMPLAINANT, WHO HAD ADMONISHED A CO-WORKER, FAILED TO PLEAD THAT HE HAD REPORTED TO ANY SUPERVISOR THAT “HAZARDOUS SAFETY OR SECURITY CONDITION” EXISTED, THAT THERE WAS ANY TEMPORAL PROXIMITY BETWEEN SUCH A REPORT AND DISCIPLINE, OR THAT A SUPERVISOR SHOWED ANY RETALIATORY INTENT BASED ON SUCH A REPORT
In Williams v. Metro-North R.R., Nos. 17-CV-3092, 17-CV-9167, 18-CV-7793, 17-CV-7758, 18-CV-8350 (S.D. N.Y. Mar. 27, 2020) (2020 U.S. Dist. LEXIS 53914) (Opinion and Order), Plaintiff, who was a coach cleaner for Metro-North, filed pro se a series of actions, one count of which was a FRSA retaliation claim.
The court granted Defendants’ FRCP 12(b)(6) motion to dismiss the FRSA count on the ground that Plaintiff had not plausibly alleged contributory factor causation. The dismissal was without prejudice to file an amended complaint to correct the deficiencies.
The court assumed arguendo that Plaintiff’s admonishment of a co-worker for engaging in an unsanitary cleaning protocol amounted to protected activity under the FRSA, but found that Plaintiff nonetheless had not alleged circumstances suggesting that his reporting of the co-worker’s conduct was a contributing factor to disciplinary proceedings. Plaintiff had been removed from service immediately following an unrelated altercation with the co-worker—and was subsequently suspended following a disciplinary proceeding. Plaintiff did not, however, indicate that the general foreman was even aware of the cleaning incident at the time he removed Plaintiff from service, the removal being based on the co-worker’s accusation that Plaintiff had acted in a threatening manner. Although Plaintiff alleged that a foreman who had been present during the cleaning incident eventually informed the general foreman about the cleaning incident, Plaintiff had not alleged when this occurred. Nor had Plaintiff alleged that he himself reported the incident, that he did so because he believed the incident reflected a “hazardous safety or security condition,” that he made such a report with temporal proximity to when he was disciplined, or that any supervisor expressed resentment or disapproval of such a report. The court stated:
In the absence of such allegations, or any other factual context surrounding any “reporting” by Plaintiff of the cleaning incident, the Court cannot plausibly infer retaliatory intent. See Niedziejko v. Del. & Hudson Ry. Co., No. 18-CV-675, 2019 WL 1386047, at *44 (N.D.N.Y. Mar. 27, 2019) (collecting cases and explaining that gaps in more than two months between a report and an adverse action are too attenuated to raise an inference of discriminatory animus or retaliatory intent); Lockhart v. Long Island R.R. Co., 266 F. Supp. 3d 659, 664 (S.D.N.Y. 2017) (“Lockhart I”) (requiring some indication of “intentional retaliatory animus” to support a FLSA retaliation claim), aff’d sub nom. Lockhart II; cf. Nichik v. N. Y. C. Transit Auth., No. 10-CV-5260, 2013 WL 142372, at *5 (E.D.N.Y. Jan. 11, 2013) (denying defendant’s motion for summary judgment because there was “direct and circumstantial evidence” that retaliatory animus was a contributing factor in the unfavorable personnel action).
Case below: Barrick v. PNGI Charles Town Gaming, LLC, 365 F. Supp. 3d 672 (N.D. W. Va., Feb. 8, 2019) (No. 17-cv-00091) (2019 U.S. Dist. LEXIS 20444)
Casenote(s):
CONTRIBUTORY FACTOR CAUSATION; FOURTH CIRCUIT FINDS THAT DISTRICT COURT PROPERLY GRANTED SUMMARY JUDGMENT WHERE THERE WAS AN INTERVENING EVENT AND PLAINTIFF’S FATHER, WHO ENGAGED IN SAME PROTECTED ACTIVITY, HAD NOT BEEN FIRED
In Barrick v. PNGI Charles Town Gaming, LLC, No. 19-1259 (4th Cir. Mar. 25, 2020) (per curiam) (unpublished) (2020 U.S. App. LEXIS 9470), the Fourth Circuit affirmed the District Court’s grant of summary judgment dismissing Plaintiff’s Bank Secrecy Act and SOX retaliation complaint. The court concluded that Plaintiff failed to demonstrate that his protected activity was a contributing factor to his termination from employment. The court found it undisputed that Plaintiff had received a final written warning from the Casino before engaging in any protected activity, and that he was aware that any further violations would result in his termination. The termination occurred after the Casino discovered that he had engaged in a violation of its personal relationship policy. The court found this to be a “legitimate intervening event” that severed any causal connection between protected activity and the termination. The court also noted that Plaintiff’s father, who engaged in the same protected activity, remains employed by the Defendant.
Case below: Fresquez v. BNSF Ry. Co., 2018 U.S. Dist. LEXIS 221499 (D. Colo., Sept. 17, 2018)
Casenote(s):
ATTORNEYS’ FEES; ALTHOUGH COURT ACCEPTED PLAINTIFF’S USE OF OUT-OF-STATE COUNSEL, IT REDUCED REQUESTED HOURLY RATE FROM $625 TO $450; REDUCTION FOR TRAVEL TIME NOT SPENT ON CASE; REDUCTION FOR EXCESSIVE CHARGE FOR PREPARING COSTS AND FEES PETITION; SUBTRACTION OF TIME SPENT ON MOTION FOR EXTENSION WHERE BASIS FOR MOTION WAS BASED ON COUNSEL’S MISTAKE
LITIGATION COSTS; COURT REDUCED CLAIMED NON-TAXABLE LITIGATION COSTS BY 45% WHERE PLAINTIFF FAILED TO ESTABLISH REASONABLENESS OF CHARGES FOR ONE OF DENVER’S MOST EXPENSIVE HOTELS AND WHAT MAY BE ITS MOST EXPENSIVE RESTAURANT
LITIGATION COSTS; COURT’S ROLE IS TO DO ROUGH JUSTICE AND NOT TO ACHIEVE ACCOUNTING PERFECTION
EXPERT FEES; COURT DISALLOWED EXPERT FEE FOR WITNESS WHO TESTIFIED ONLY ON AN UNCONTESTED ISSUE
EXPERT FEES; COURT ALLOWED FEE PAID TO AN ACCOUNTANT TO REVIEW THE REASONABLENESS OF FEES AND COSTS
In Fresquez v. BNSF Ry., No. 17-cv-0844 (D. Colo. Mar. 20, 2020) (2020 U.S. Dist. LEXIS 48416), a jury returned a verdict in favor of Plaintiff after a six day trial, finding that Defendant retaliated against Plaintiff in violation of the FRSA. The court then considered Plaintiff’s initial and supplemental fees and costs petition.
Attorneys’ Fees
Plaintiff had engaged two attorneys as counsel. The court accepted Plaintiff’s argument that he had been unable to obtain local counsel in Colorado for his FRSA suit, and thus out-of-state rates were appropriate and reasonable. The court, however, was not persuaded that the hourly rate of $625 was reasonable. Although counsel represented that the rate was effectively $575 an hour because they had not charged for staff, the court found it impossible to determine how staff time factored into the proffered rate or the “effective” rate. The court declined to accept a location-adjusted rate based on the Laffey Matrix, noting that other courts in the District had declined to adopt it, even adjusted, outside the District of Columbia, and that counsel had not explained how they arrived at the locality adjusted rate. The court was not convinced by the declaration of other lawyers who represent injured railroad workers because they had not addressed the prevailing market rate for such work or the qualifications of one of Plaintiff’s attorneys. Exercising its discretion to use other factors to set the rate when presented within inadequate evidence of market rates, the court looked to the rates charged by employment lawyers within Colorado, the prevailing rates for those who specialize in FRSA and FELA litigation awarded by other courts nationally, and the level of competence required to successfully litigate the instant claim. The court found that the reasonable rate was $450 per hour.
The court indicated its appreciation that Plaintiff’s counsel exercised billing judgment to reduce claimed hours as the result of conferring with Defendant prior to submitting the fee petition, and summarily rejected a number of Defendant’s objections. The court, however, discussed a number of Defendant’s meritorious objections. It first noted that Plaintiff’s counsel had already reduced travel time by one-half in their initial fee motion to reflect time actually spent on the case during travel, but had failed to do so for their supplement fee petition. The court found the 50% reduction appropriate and similarly reduced the supplement. The court agreed that 69.8 hours drafting the initial fee motion was excessive and reduced this time by 50%. The court subtracted two hours charged for a motion for leave to file out of time where counsel had thought it was due the following week — the court finding it not reasonable to charge Defendant for Plaintiff’s counsel mistake.
Litigation costs
Plaintiff’s counsel sought $83,041.43 in litigation costs in addition to taxable costs. The court first rejected BNSF’s argument that “litigation costs” should be construed narrowly and limited to taxable costs under 28 U.S.C § 1920, finding that this argument had previously been rejected in Wallis and Wooten. BNSF also challenged the reasonableness of Plaintiff’s litigation costs, particularly travel expenses, expenses incurred in connection with the trial, and office supplies. The court found that Plaintiff failed to fully discharge the burden of establishing that the costs were reasonable related to the litigation, particularly in regard to troubling charges for one of Denver’s most expensive hotels and perhaps its most expensive restaurant. The court noted that there were “at least a dozen perfectly acceptable and substantially less expensive hotels within a half-mile of the federal courthouse.” Slip op. at 13. The court found, however, that some of the concerns raised by BNSF did not withstand scrutiny, and declined BNSF’s request that the court examine each receipt to determine how the cost related to the litigation and the reasonableness thereof. Rather, the court noted that the role of the court in this regard is to do rough justice rather than to achieve auditing perfection. The court found it appropriate to reduce the requested costs by 45%.
Expert fees
BNSF challenged requested fees of $28.505.66 as excessive for one expert witness who testified on track safety and defect reporting. The court agreed that Plaintiff had not shown that this fee was reasonable, particularly because the testimony was on an uncontested issue and that expert’s fee was more than double that of other experts.
The court disagreed with BNSF’s challenge to a fee paid to an accountant to review the reasonableness of fees and costs. BNSF argued that “[a]n attorney familiar with the case and with allowable costs is more qualified to perform this analysis than an accountant with no involvement in the case.” Id. at 15 (quoting BNSF objections). The court explained its disagreement: “There were a very large number of costs associated with this case, and Plaintiff’s counsel was not required to wade through piles of receipts to determine the costs incurred. Rather, it was reasonable to hire an outside professional to analyze the costs and raise issues where necessary, rather than spend attorney hours (particularly at Plaintiff’s counsel’s requested rate of $625) compiling and reviewing such information.” Id.
Casenote(s):
PROTECTED ACTIVITY; PLAINTIFF’S SUBJECTIVE REACTION TO CONDUCT THAT WAS OTHERWISE NOT SAFETY RELATED
In Ziparo v. CSX Transp., Inc., No. 17-cv-708 (N.D. N.Y. Mar. 9, 2020) (2020 U.S. Dist. LEXIS 39908), Plaintiff, a train conductor, asserted that Defendant took various adverse actions against him in violation of the FRSA in retaliation for complaining about supervisors’ orders to falsify information about departure time, arrival time, and the completeness of his work into Defendant’s onboard electronic system in order to improve their chances of bonuses. The court found that Defendant’s Onboard Work Order (“OBWO”) devices were used to enable customers to track their deliveries, and that OBWO was not safety equipment. Plaintiff’s assertion was essentially that he and other employees were being harassed about the OBWO entries, and that such harassment was a safety issue because it made employees unfocused and preoccupied.
The court first found that there was no admissible evidence that other employees were affected in the manner alleged. Thus, the focus was on Plaintiff’s specific situation. The court noted that even if an employee reasonably or honestly believes that the condition was unlawful, he must still show that it was a safety or security related concern. In other words, it must have been subjectively and objectively reasonable for Plaintiff to believe that the supervisor’s entreaties to falsify data constituted a “hazardous safety or security condition.”
The court stated that such conditions “have generally been found to be physical conditions that are within the control of the rail carrier employer; circumstances outside of the carrier’s control and non-work related conditions are not included.” Slip op. at 35 (citations omitted). The court found no federal court or ARB decisions “in which a plaintiff’s subjective reaction to conduct that is otherwise not safety-related, without more, was sufficient to establish a ‘hazardous safety or security condition.’” Id. at 36. Here, even if the underlying condition of the supervisors’ harassment was work-related, “Defendant had no control over Plaintiff’s reaction to that condition, and it was that reaction (rather than the condition itself) that caused the alleged ‘hazardous safety and security condition’. . . . ”Id. The court thus found as a matter of law that “the alleged condition constituted a ‘hazardous safety or security condition’ within the scope of FRSA.” Id
The court noted that no admissible evidence had been presented that the purported harassing conduct occurred while Plaintiff was engaged in safety-sensitive railroad work. The court found inapposite cases cited by Plaintiff on hostile work environment or safety-implicated poor communications. Nor had Plaintiff alleged any physical violence or threats of such—rather, the alleged threats causing stress were of insubordination charges or termination.
In sum, the court found that Plaintiff failed to establish that he reported a “hazardous safety or security condition” for the purposes of 49 U.S.C. § 20109(b)(1)(A). The court stated that it was not convinced that “based on the admissible record evidence, a reasonable factfinder could conclude that Plaintiff’s belief that his distraction under the circumstances constituted a hazardous safety or security condition was objectively reasonable.” Id. at 40. The court noted that a proffered expert opinion that Plaintiff’s distraction was a hazardous safety or security condition was insufficient to raise a genuine issue of material fact because that opinion was inadmissible either as a legal conclusion or an issue of fact reserved to the jury.
PROTECTED ACTIVITY; WHERE ADMISSIBLE EVIDENCE OF RECORD DID NOT SHOW THAT PLAINTIFF’S COMPLAINTS ABOUT AN INABILITY TO LOCATE TRAIN CARS AT THE BEGINNING OF A SHIFT RELATED TO SAFETY AT THE TIME OF MAKING THOSE COMPLAINTS, SUCH COMPLAINTS WERE NOT PROTECTED ACTIVITY
In Ziparo v. CSX Transp., Inc., No. 17-cv-708 (N.D. N.Y. Mar. 9, 2020) (2020 U.S. Dist. LEXIS 39908), Plaintiff, a train conductor, asserted that Defendant took various adverse actions against him in violation of the FRSA in retaliation for complaining about supervisors’ orders to falsify information about departure time, arrival time, and the completeness of his work into Defendant’s onboard electronic system in order to improve their chances of bonuses. The court found that Defendant’s Onboard Work Order (“OBWO”) devices were used to enable customers to track their deliveries, and that OBWO was not safety equipment. Plaintiff averred that falsification of the entries “constituted a ‘hazardous safety or security condition’ based on the inability to track the precise location of railcars on the OBWO (including those containing hazardous materials).” Slip op. at 41-42.
The court found that Plaintiff had not, based on the admissible record evidence, established that he believed he was reporting a hazardous safety condition as a result of the falsification of data specifically because of an inability to locate railcars. The court found that Plaintiff’s statement that “employees had to, at the beginning of a new shift, ‘figure out which cars had been placed and which had not’ as meaning that employees had difficulty locating railcars in the way that Plaintiff now suggests . . . .” Id. at 42-43. The court stated that “Plaintiff cannot rely on inferences he believes Defendant should have drawn to remedy his failure to report a certain basis for his belief of the existence of a ‘hazardous safety or security condition.’” Id. (citations omitted). The court found that a reasonable factfinder could not conclude based on the admissible evidence that Plaintiff had in mind an inability to locate railcars in the way he now asserts when he made his various complaints. Plaintiff was required to actually believe that it was a “hazardous safety or security condition” at the time he made his complaints.
Related USDOL Case: ARB Nos. 18-044, -045, ALJ No. 2017-FRS-00007
Casenote(s):
PETITION FOR REVIEW OF DOL’S DISMISSAL OF FRSA RETALIATION COMPLAINT DENIED WHERE ALJ’S FINDINGS OF FACT WERE SUPPORTED BY SUBSTANTIAL EVIDENCE; TESTIMONY THAT EMPLOYER CONSIDERS AN ENGINEER’S LEAVING WORK WITHOUT PERMISSION TO BE A SERIOUS FORM OF INSUBORDINATION
In Hunter v. Administrative Review Board, USDOL, No. 19-604426 (5th Cir. Feb. 27, 2020) (per curiam) (unpublished), a locomotive engineer filed a claim of retaliatory termination in violation of the FRSA. The engineer had reported a wheel slip fault. His employer terminated his employment for leaving work before being relieved by a supervisor. The engineer claimed that the termination was in retaliation for reporting the wheel slip. The ALJ found that the engineer engaged in protected activity but had not established that this activity was a contributing factor in the termination, and that the employer demonstrated it would have taken the same adverse action in the absence of his protected activity. The ARB affirmed.
The Fifth Circuit denied the engineer’s petition for review, finding that the ALJ’s findings of fact were based on substantial evidence. The court noted that the ALJ had conducted a two-day hearing, during which supervisory employees all testified that “leaving work without permission was a brand of insubordination and a serious offense subject to discharge.” In addition, the ALJ found no evidence that the trainmaster’s knowledge of the engineer’s protected activity could be imputed to the relevant decisionmakers on the termination.
District Court Case No. Lockhart v. Long Island R.R. Co., 266 F. Supp. 3d 659 (S.D.N.Y., Aug. 2, 2017)
USDOL Case: ALJ No. 2015-FRS-00055
Casenote(s):
PROTECTED ACTIVITY AND CONTRIBUTING FACTOR CAUSATION; EMPLOYEE ABSENCES DUE TO BEING PRESCRIBED NARCOTIC DRUGS; COURT FINDS THAT EMPLOYER DID NOT VIOLATE THE FRSA BY DISCIPLINING AN EMPLOYEE FOR ABSENCES WHERE THE EMPLOYEE FAILED TO SUBMIT MEDICAL CERTIFICATION FORMS REQUIRED BY EMPLOYER TO VERIFY APPROPRIATE USE OF MEDICAL LEAVE
In Lockhart v. MTA Long Island R.R., 949 F.3d 75 (2d Cir. Feb. 4, 2020) (No. 17-2725) (2020 U.S. App. LEXIS 3297), the Second Circuit affirmed the district court’s grant of MTA’s motion for summary judgment. Lockhart had filed a FRSA complaint alleging retaliation when MTA disciplined him for failing to report to work while under the influence of prescribed narcotic drugs. The district court had found that the discipline was based on Lockhart’s failure to present verifying documentation as required by MTA’s sick leave policy. The Second Circuit held that “[b]ecause the statute does not prevent employers from requesting reasonable documentation to assure themselves that employees’ absences are legitimate, we affirm.” Slip op. at 2.
The court did not reach the issue whether the FRSA covers off-duty maladies, because—assuming arguendo that it does—Lockhart failed to demonstrate that his absences, when unaccompanied by medical certification forms required by MTA to avoid a leave policy violation (“SLA-28 form”), were protected activity. The court stated:
[N]owhere in the statute are employers prevented from using the common practice of requiring reasonable documentation to assure that an employee’s claimed medical absences are legitimate. Nor has appellant demonstrated that prohibiting such a practice only in cases involving railroad safety was a policy intended by the Congress. Because nothing in the text, structure, and purpose of the FRSA directs otherwise, the railroad was within its rights to seek verification of illnesses before excusing appellant’s absences as activity protected under the FRSA. Indeed, it would be rather adventurous to infer an FRSA requirement that a railroad take employees at their word that the reason for a failure to report to work was an easily verifiable doctor-prescribed mind-altering drug. The SLA-28 form, which requires a physician’s diagnosis, treatment plan, and signature, authenticates that information and does not overstep.
There is also ample case law in other statutory contexts holding that employers have the right to request medical certification documenting an employee’s need for protected leave. For example, courts have held that employers may require employees to fill out standardized reasonable accommodation request forms in order to be entitled to accommodations (including sick leave) under the Americans with Disabilities Act. See, e.g., Pauling v. District of Columbia, 286 F. Supp. 3d 179, 211-12 (D.D.C. 2017); Lundquist v. Univ. of S.D. Sanford Sch. of Med., No. 09-CV-4147, 2011 WL 5326074, at *8 (D.S.D. Nov. 4, 2011); Kunamneni v. Locke, Nos. 1:09-CV-005 (JCC), 1:09-CV-450 (JCC), 2009 WL 5216858, at *11 (E.D. Va. Dec. 29, 2009). Similarly, the Family and Medical Leave Act specifies that employers may require employees to submit health care provider certifications connected to their leave. See 29 U.S.C. § 2613. Appellant has articulated no basis upon which to adopt a view that the FRSA affirmatively prohibits employers from imposing a similar requirement.
Moreover, the SLA-28 form does not constitute a waiver of an employee’s rights prohibited by the FRSA and the form does not have to expressly reference the statute. Section 20109(c)(2) states that an employee may not be disciplined “for following orders or a treatment plan of a treating physician.” It is perfectly reasonable for a carrier to assure itself that an employee is indeed following a treating physician’s orders in missing work by verifying those orders through the submission of standardized health care provider certifications such as form SLA-13 28.
Id. at 10-12 (footnote omitted).
USDOL Case: ARB Nos. 16-010, -052, ALJ No. 2014-FRS-44
Casenote(s):
CONTRIBUTORY FACTOR CAUSATION; EIGHTH CIRCUIT FINDS THAT THE ARB AND ALJ ERRED IN FAILING TO APPLY KUDUK v. BNSF RY; SUSPENSION FOR UNTIMELY FILING OF REPORT THAT RAILROAD’S RULE REQUIRES TO BE FILED PROMPTLY DOES NOT, WITHOUT MORE, ESTABLISH A FRSA RETALIATION CASE
In Dakota, Minn. & E. R.R. Corp. v. United States Dep't of Labor Admin. Review Bd., 948 F.3d 940 (8th Cir. Jan. 30, 2020) (No. 18-2888) (2020 U.S. App. LEXIS 2978; 2020 WL 486843) (case below ARB Nos. 16-010, -052, ALJ No. 2014-FRS-44), the ARB had affirmed the ALJ’s holding that Petitioner violated the whistleblower retaliation provisions of the FRSA when it suspended the complainant, a locomotive engineer, for his untimely reporting of a “work-related personal injury” or a “hazardous safety or security condition.” 49 U.S.C. §§ 20109(a)(4), (b)(1)(A), (d). On appeal, Petitioner argued that the ARB and the ALJ had failed to follow the Eighth Circuit’s ruling in Kuduk v. BNSF Ry., 768 F.3d 786, 791 (8th Cir. 2014) that “the contributing factor that an employee must prove is intentional retaliation prompted by the employee engaging in protected activity.” The court agreed, and remanded the matter to the ARB to apply the correct legal standard.
The complainant had been involved in a physical altercation with a co-worker at Petitioner’s terminal in Bensenville, Illinois. Complainant was struck by a lantern. Complainant did not report the altercation to supervisors in Bensenville. Complainant testified that after going to his hotel for a mandatory 12-hour rest period, he attempted to call his immediate supervisor in Dubuque Iowa, and sent a text, and then fell asleep. In a later phone conversation, complainant told the immediate supervisor that he had been assaulted and that he did not want to work with the co-worker again. The supervisor told complainant that he needed to make an official report in order for him to deal with it. Complainant said he did not want to get the co-worker fired and needed time to think about filing a formal report. A few hours later he did file a formal complaint. Later, he discovered a bruise where the lantern struck him and added that to his complaint.
Petitioner immediately interviewed both employees and then launched a formal investigation. Ultimately the Petitioner determined that complainant had failed to promptly report the incident, and that dismissal was warranted because complainant was under a “last chance” agreement — but that it had decided that the time complainant was withheld from service during the 47 day investigation would be assessed as formal discipline. The co-worker’s employment was terminated. The Railway Labor Board upheld complainant’s suspension, but reduced it to 15 days. Complainant then filed his FRSA complaint. The ALJ applied decisions from the ARB and other circuits holding that neither motive nor animus are required to prove causation under the FRSA as long as protected activity contributed in any way to the adverse action. The ALJ determined that complainant satisfied the contributing-factor element of his case because his report of altercation had set in motion a chain of events leading to the discipline.
On appeal to the ARB, Petitioner argued that the chain-of-events analysis was contrary to controlling 8th Circuit precedent. The ARB distinguished Kuduk, and affirmed the ALJ’s decision, stating that “‘[s]imply put, [Riley’s] reporting of the injury set in motion the chain of events eventually resulting in the investigation and is inextricably intertwined with the eventual adverse employment action.’” Slip op. at 6 (quoting ARB decision and adding emphasis). The court noted:
The ARB’s opinion included a lengthy footnote arguing that Kuduk’s intentional retaliation standard “is both conclusory and contrary to the weight of precedent” and that Kuduk erred in adopting the Supreme Court’s causation standard in Staub v. Proctor Hospital, 562 U.S. 411 (2011), because the FRSA “does not require a complainant to ’demonstrate the employer’s retaliatory motive.’”
Id. at 7.
The 8th Circuit was not persuaded by the ARB’s analysis:
The ARB’s reasoning is both contrary to our governing precedents and fatally flawed. The FRSA prohibits a rail carrier from discriminating against an employee for engaging in protected activity. 49 U.S.C. § 20109(a). In Staub, the Supreme Court noted that intentional torts such as this require a showing that a supervisor’s “discriminatory animus” was a causal factor of the ultimate employment action. 562 U.S. at 420-21. Applying that ruling to FRSA retaliation claims, we held in Kuduk that “the contributing factor that an employee must prove is intentional retaliation prompted by the employee engaging in protected activity.” 768 F.3d at 791. To establish this element of his prima facie case, the employee does not have to conclusively prove retaliatory motive but must show more than temporal proximity between the protected activity and the adverse action. Id. at 791-92.
Id. (emphasis as in original). The court also outlined its decisions that had confirmed and followed Kuduk. The court acknowledged that in the instant case complainant’s report and the discipline were an “inextricably intertwined” “chain of events.” Nonetheless, the court stated that “no sinister inference may be drawn from this chain of events.” Id. at 9. The court elaborated:
“An injury report is a normal trigger for an investigation designed to uncover facts that can prompt corrective action that will reduce the likelihood of a future injury.” Koziara v. BNSF Ry., 840 F.3d 873, 878 (7th Cir. 2016). By ruling that this factual connection was sufficient to satisfy the contributing factor causal element of an FRSA claim, the ARB in essence held that an employee can be free of discipline and recover FRSA damages simply by disclosing misconduct of which the employer is otherwise unaware in a report that will be considered protected FRSA activity. It is well settled that “employees cannot immunize themselves against wrongdoing by disclosing it in a protected-activity report.” BNSF Ry. v. U.S. Dep’t of Labor (Cain), 816 F.3d 628, 639 (10th Cir. 2016). The principle applies in this situation: the protected activity was the untimely filing of a report that CP’s operating rules require employees to promptly file, consistent with railroad safety; a suspension imposed for violating that rule does not, without more, evidence discrimination against a good faith rail safety whistleblower
Id.
USDOL Case: 2018-FRS-00148
Casenote(s):
CONTRIBUTING FACTOR CAUSATION; COURT GRANTS SUMMARY JUDGMENT AGAINST PLAINTIFF BASED ON GUNDERSON FACTORS
PROTECTED ACTIVITY; RAISING OF CONCERN THAT FOREMAN LACKS PROPER QUALIFICATIONS; SUMMARY JUDGMENT GRANTED UNDER 20109(a)(2) WHERE PLAINTIFF DID NOT POINT TO A FEDERAL LAW, RULE OR REGULATION THAT HAD BEEN VIOLATED, AND UNDER 20109(b)(1) WHERE PLAINTIFF’S EVIDENCE FAILED TO SHOW THAT THE CONCERN WAS OBJECTIVELY OR SUBJECTIVELY REASONABLE
In Gonzalez v. Metro-North Commuter R.R., No. 18-cv-10270 (S.D. N.Y. Jan. 15, 2020) (2020 U.S. Dist. LEXIS 9059), Plaintiff alleged that Defendant violated the whistleblower provision of the FRSA when he was discharged for insubordination. Plaintiff alleged that the real reason for the discharge was protected activity regarding Plaintiff’s reports of unsafe conditions of company trucks and regarding Plaintiff’s questioning of whether a foreman had the proper safety qualifications to lead the gang onto the tracks. The court granted Defendant’s motion for summary judgment.
In regard to Plaintiff’s reports of unsafe trucks, the court found not a scintilla of evidence suggesting that they were a contributing factor in Plaintiff’s dismissal. The court applied the five-part test from Gunderson v. BNSF Ry. Co., 850 F.3d 962, 969 (8th Cir. 2017), and found that each relevant factor favored Defendant. First, the disciplinary investigation that led to Plaintiff’s discharge was exclusively concerned with the insubordination with no mention whatsoever of the condition of company trucks. Second, Plaintiff’s multiple incidents of insubordination and refusal to work during an emergency were intervening events that independently justified disciplinary actions. Third, Plaintiff was represented by union counsel throughout the disciplinary proceedings and the dismissal was upheld by both the railroad internally and by an independent arbitration panel. The fourth factor was inapposite because DOL never completed its investigation. Factor five weighed in Defendant’s favor because there was no showing that the lower-level supervisor accountable for addressing Plaintiff's safety complaints about the trucks played any role in the adjudication of the insubordination charges. The court noted that the evidence of record showed that repairs were made when needed, and that Plaintiff had never been disciplined for his frequent reports on truck conditions. The court noted that the manager never told Plaintiff to stop asking for truck repairs, or had even complained about Plaintiff’s reports. The court found the admissible evidence, even when considered in the light most favorable to Plaintiff, made it clear that Plaintiff was removed from service for multiple instances of insubordination compounded by an existing disciplinary record.
Reviewing Plaintiff’s questioning of the foreman’s qualifications under 49 U.S.C § 20109(a)(2), the court noted that Plaintiff had not pointed to any Federal law, rule or regulation that established minimum qualifications for taking men onto the tracks to work. Although Plaintiff stated that his training and experience suggested that proper procedures had not been followed, the court stated that the “statute [at 49 U.S.C § 20109(a)(2)] plainly requires pointing to a violation of a Federal law, rule, or regulation. Here we have no such law, rule, or regulation.” The court also found that the report about the foreman’s qualifications did not fall within 49 U.S.C § 20109(b)(1), as Plaintiff had “not provided a scintilla of evidence showing that [the foreman’s] leading the men onto the tracks that night was objectively—or even subjectively—a ‘hazardous safety or security condition’ under 49 U.S.C § 20109(b)(1)(A).” Slip op. at 18. The court found Plaintiff’s report to be objectively unreasonable because there was no evidence of record that the foreman was not qualified, and in fact, the evidence pointed to the contrary. The court found Plaintiff’s report also to be subjectively unreasonable as shown by the facts that Plaintiff did not refuse to work after the foreman gave the safety briefing, that Plaintiff’s own testimony was that because of the nature of the work being done—the foreman’s giving the briefing was not a huge risk factor, and that Plaintiff never brought a formal safety challenge about the foreman’s qualifications.
The court also found that the qualifications complaint was not a contributing factor in Plaintiff’s dismissal, again applying the Gunderson factors.
USDOL Case: ARB No. 2018-043, ALJ No. 2017-FRS-00078
Casenote(s):
CONTRIBUTING FACTOR CAUSATION; FRCP 12(b)(6) MOTION; PLAINTIFF FAILED TO PLAUSIBLY ALLEGE CONTRIBUTING FACTOR CAUSATION WHEN THERE HAD BEEN A FOUR YEAR GAP BETWEEN PROTECTED ACTIVITY AND ADVERSE EMPLOYMENT ACTION
In Sirois v. Long Island R.R., No. 18-2858-cv (2d Cir. Jan. 14, 2020) (unpublished) (2020 U.S. App. LEXIS 1480; 2020 WL 209282), Plaintiff-appellant appealed from the district court’s grant of a motion to dismiss under FRCP 12(b)(6). Plaintiff alleged that Defendant violated the FRSAʹs anti‐retaliation provisions by changing her injury status from work‐related to non‐work‐related, resulting in the loss of certain benefits. The court noted that “[t]emporal proximity may support a prima facie inference that the protected activity was a contributing factor, but only where the protected act and the retaliation occur in quick succession.” Slip op. at 7 (citations omitted). The court noted that the Second Circuit has not drawn a bright line on when a temporal relationship is too attenuated to establish causal relationship, but instead exercises judgment on permissible inferences that can be drawn based on temporal proximity in the context of the particular case. In the instant case, over four years had passed from the protected activity of reporting the injury to the reclassification. The court held that “[a] temporal gap of over four years is too attenuated to support the requisite inference.” Id. at 8-9. The court held that Plaintiff “thus failed to plausibly allege that her protected activity was a contributing factor in the unfavorable treatment” and concluded “that the district court did not err when it dismissed Siroisʹs claim.” Id. at 9.
USDOL Case: 2018-FRS-00045
Casenote(s):
PLEADING; FAILURE TO ASSERT PROTECTED ACTIVITY UNDER THE FRSA IN ADMINISTRATIVE COMPLAINT DOES NOT WARRANT SUMMARY DISMISSAL IN FEDERAL COURT ACTION, ESPECIALLY WHERE OSHA INVESTIGATED INJURY IN CONNECTION WITHER TERMINATION
SUMMARY DISMISSAL; EVIDENCE THAT DEFENDANT FOLLOWING ITS INTERNAL PROCEDURES AND SAFEGUARDS AGAINST RETALIATION INSUFFICIENT IN ITSELF FOR SUMMARY DISMISSAL BECAUSE IT IS PEOPLE, NOT THE PROCESS, WHO RETALIATE
In Rossich v. BNSF Ry. Co., No. 18-cv-5829 (W.D. Wash. Jan. 9, 2020) (2020 U.S. Dist. LEXIS 4502), BNSF moved for summary dismissal of Plaintiff’s claim that BNSF violated the FRSA when it dismissed him in retaliation for reporting a work-related injury. The court denied the motion. BNSF contended, inter alia, that the claim failed because Plaintiff had not asserted protected activity in the OSHA complaint. The court, however, noted Plaintiff’s argument that “the administrative process is not formal and as a result strict formalistic treatment of the allegations in his complaint are not appropriate,” (slip op. at 5) and that BNSF acknowledged that Plaintiff’s injury had been mentioned in the OSHA complaint and that OSHA had investigated the injury in connection with the termination. BNSF also contended that it established its affirmative defense that it would have terminated Plaintiff with or without the intervening injury. Defendant essentially contended that Plaintiff had been discharged after management officials concluded that Plaintiff had violated BNSF rules regarding a crew’s failure to secure unattended equipment properly, and in accordance with BNSF’s progressive discipline policy. The court was not convinced by BNSF’s notation that OSHA found for BNSF and that the Federal Railroad Administration found that Plaintiff violated the securement regulations. In sum, the court wrote:
As in a recent Montana case, “BNSF puts much stock in its internal procedures and safeguards designed to prevent discrimination while failing to recognize that these checks are only as effective as the people enforcing them. . . . [T]he people, not the process, treated him unfairly by retaliating against him after he filed his injury report.” Wooten v. BNSF Ry. Co., 387 F.Supp.3d 1078, 1094 (D. Montana 2019).”
Id. at 6-7.
Casenote(s):
PERMISSIBLE SCOPE OF FEDERAL COURT SOX COMPLAINT IN RELATIONSHIP TO ADMINISTRATIVE EXHAUSTION REQUIREMENT; DISTRICT COURT ADOPTS TITLE VII APPROACH; CHARGES IN DISTRICT COURT COMPLAINT MUST FALL WITHIN SCOPE OF COMPLAINT FILED WITH OSHA OR A REASONABLE INVESTIGATION FLOWING FROM THAT COMPLAINT
In Erhart v. BofI Holding, Nos. 15-cv-02287, 15-cv-02353 (S.D. Cal. Mar. 31, 2020) (2020 U.S. Dist. LEXIS 57137), Plaintiff was an internal auditor for BofI Federal Bank who filed a whistleblower retaliation suit under state and federal law. BofI countersued. The court consolidated the suits. Before the court were cross motions for summary judgment. In regard to Plaintiff’s SOX retaliation claim, the court granted in part and denied in part BofI’s request for summary judgment. One of the matters on which summary judgment was granted was a finding that Plaintiff failed to exhaust administrative remedies on one allegation concerning altered financial statements. There was no dispute that Plaintiff commenced the SOX administrative process and then waited at least 180 days to file his district court complaint. See 18 U.S.C. § 1514A(b)(1)(B). Defendant’s claim was that Plaintiff’s Federal court complaint impermissibly exceeded the scope of the administrative filing by identifying “six new categories” of allegedly wrongful conduct.
The court first noted that the administrative SOX complaint filed with OSHA is not a formal pleading expected to meet the FRCP 12(b)(6) standards. The court noted, on the other hand, that “’an exhaustion requirement would be meaningless if the complainant were free to litigate claims bearing little or no connection to the preceding administrative complaint.’ Jones v. Southpeak Interactive Corp. of Del., 777 F.3d 658, 669 (4th Cir. 2015).” Slip op. at 13. The court looked at approaches courts had taken when a defendant argues the lawsuit exceeds the scope of the OSHA complaint, and was persuaded by those that had looked to Title VII cases for guidance. The court thus determined that the permissible scope of Plaintiff’s district court lawsuit would cover charges of retaliation that are like or reasonably related to the allegations made in the OSHA complaint, or that fell within the OSHA investigation which can reasonably be expected to grow out of the charge of retaliation. Id. at 14, citing the EEOC-related decision in Sommatino v. United States, 255 F.3d 704, 708 (9th Cir. 2001).
In the instant case, the complaint filed with OSHA was imprecise, supported in large part by a thumb drive containing documents related to Plaintiff’s allegations. The court agreed with Defendant that “‘no authority supports the proposition that merely submitting a thumb drive of raw documents and data to OSHA satisfies the exhaustion requirement’s pleading requirement such that a court has jurisdiction over every conceivable claim that might be premised on the contents of any and all documents on the drive.’” Slip op. at 17, quoting BofI’s reply brief. The court stated that “[t]he agency cannot be expected to interpret a heap of e-mails and spreadsheets to determine what Erhart believed was wrong.” Id. The court, however, found in the administrative complaint and attachments a factual timeline and summary of “key issues” that was not raw data, and which sufficiently aligned with almost of the challenged allegations in district court. The court found that the record did not establish that Plaintiff was attempting to circumvent the SOX exhaustion requirement, and cited Jones for the proposition that the “‘exhaustion requirement should not become a tripwire for hapless plaintiffs.’” Id. at 18, quoting Jones, 777 F.3d at 669. The court found, nonetheless, that Plaintiff’s allegations regarding potentially altered financial documents had not been mentioned in the OSHA complaint or his whistleblower discussion notes. The court determined that this conduct had not been demonstrated to fall within the scope of the OSHA complaint or a reasonable investigation flowing from the complaint.
SOX PROTECTED ACTIVITY CHALLENGE ON SUMMARY JUDGMENT; COURT CONSTRUCTS METHODOLOGY FOR EXAMINING SUCH A CHALLENGE; COURT FINDS AS A BROAD MATTER THAT RULES ON “BOOKS-AND-RECORDS” AND “INTERNAL CONTROLS” ARE SOX PROTECTED ACTIVITY, AS ARE COMPLAINTS ABOUT SHAREHOLDER FRAUD; COURT FINDS THAT “FRAUD ON REGULATORS” WAS NOT SHOWN TO BE SOX 1514A PROTECTED ACTIVITY; COURT NOT REQUIRED TO SIFT THROUGH SECURITIES LAWS AND REGULATIONS FOR PROVISIONS PLAINTIFF MAY HAVE BELIEVED WERE VIOLATED; AFTER DETERMINING BROAD CATEGORIES, COURT REVIEWED FACTS OF THE CASE TO DETERMINE WHETHER PLAINTIFF’S CONDUCT FIT 1514A AND WHETHER HIS BELIEF OF A VIOLATION WAS OBJECTIVELY REASONABLE
In Erhart v. BofI Holding, Nos. 15-cv-02287, 15-cv-02353 (S.D. Cal. Mar. 31, 2020) (2020 U.S. Dist. LEXIS 57137), Plaintiff was an internal auditor for BofI Federal Bank who filed a whistleblower retaliation suit under state and federal law. BofI countersued. The court consolidated the suits. Before the court were cross motions for summary judgment. In regard to Plaintiff’s SOX retaliation claim, the court granted in part and denied in part BofI’s request for summary judgment. The court examined BofI’s contention that 12 categories of conduct identified by Plaintiff did not constitute SOX protected activity as a matter of law. In order to address this challenge, the court established a framework: it first reviewed the reasonable belief standard for SOX retaliation claims; it explored how the claim would function before a jury; it reviewed the several rules Plaintiff relied on to explain why he believed BofI’s conduct was wrongful; and it assessed BofI’s discrete challenges. This portion of the decision is too lengthy to condense into a casenote and the following is only a brief summary. The court noted the reasonable belief standard, with its subjective and objective components, from Wadler v. Bio-Rad Labs., Inc., 916 F.3d 1176, 1186—87 (9th Cir. 2019) and other decisions. It also referred to Wadler and other decisions in regard to how the reasonable belief instruction would be addressed before a jury. The court stated that Plaintiff’s “beliefs must be tied to at least one segment of laws in § 1514A to support his Sarbanes—Oxley claim. The Court will have to tell the jury what the underlying law prohibits. Erhart therefore cannot broadly argue that he objectively believed there were violations of ’any rule or regulation of the [SEC]’ or ’any provision of Federal law relating to fraud against shareholders.’ See 18 U.S.C. § 1514A. This Court should not be expected to—and realistically cannot—’go fishing through securities law and regulation for provisions [Erhart] may have believed were violated.’” Slip op. at 22 (citations omitted).
The court then examined the rules that Plaintiff contended fall within § 1514A’s scope. Those fell into four categories.
Books-and-Records Rule. The court stated that “the Books-and-Records Rule prohibits the falsification of a corporate record that is necessary to accurately and fairly reflect the transactions and dispositions of the assets of the company in reasonable detail. And this rule falls under § 1514A because it is a ’rule or regulation of the [SEC].’ See 18 U.S.C. § 1514A; See also Wadler, 916 F.3d at 1185.”
Internal Controls Rule. The court stated that “the Internal Controls Rule requires a regulated company to maintain a system that provides reasonable assurance regarding the reliability of financial reporting and the preparation of external financial statements. The system must include policies and procedures regarding certain items, including providing reasonable assurance that expenditures are made only in accordance with management’s authorization. The rule does not, however, broadly require compliance with all laws or corporate risk management objectives. And like the Books-and-Records Rule, the Internal Controls Rule falls under § 1514A because it is a “rule or regulation of the [SEC].” Id. at 27.
Shareholder Fraud. The court found that shareholder his item falls within 1514A and that it requires at least (1) material misrepresentation or omission of fact and (2) an indication of an intent to defraud.
Fraud on Regulators. The court found that Plaintiff failed to show how a fraud-on-regulators theory falls within a SEC rule or the categories listed in 1514A.The court then examined the categories of conduct challenged as protected activity by BofI, and whether Plaintiff demonstrated the conduct fits into one of the segments of laws included in § 1514A, and whether he produced sufficient evidence that a trier of fact could conclude that his belief of a violation was objectively reasonable. The court found that nine categories of challenged protected activity could be summarily adjudicated in favor of BofI, but not two of the challenged categories. In addition, the court noted that BofI’s motion had not challenged two other categories.
KNOWLEDGE ELEMENT; DEPOSITION TESTIMONY OF PLAINTIFF’S DIRECT SUPERVISOR THAT HE NEVER THOUGHT OF PLAINTIFF’S REPORTING TO HIM ON HIS AUDIT WORK AS WHISTLEBLOWER ACTIVITY; COURT FIND THAT SUCH TESTIMONY WAS INSUFFICIENT TO WARRANT A GRANT OF SUMMARY JUDGMENT ON KNOWLEDGE ELEMENT OF SOX CLAIM
In Erhart v. BofI Holding, Nos. 15-cv-02287, 15-cv-02353 (S.D. Cal. Mar. 31, 2020) (2020 U.S. Dist. LEXIS 57137), Plaintiff was an internal auditor for BofI Federal Bank. He filed a whistleblower retaliation suit under state and federal law. BofI countersued. The court consolidated the suits. Before the court were cross motions for summary judgment. In regard to Plaintiff’s SOX retaliation claim, the court granted in part and denied in part BofI’s request for summary judgment. One of BofI’s summary judgment requests was on the knowledge element of the SOX claim, BofI contending that all of Plaintiff’s disclosures occurred within the confines of assigned audit work and that, for certain categories of suspected wrongdoing, no factfinder could reasonably conclude that the method and content of those activities put BofI on notice. BofI pointed to deposition testimony of Plaintiff’s direct supervisor that he never thought Plaintiff was acting as a “whistleblower” when reporting to him. The court, however, denied summary judgment, finding that — viewing the evidence in the light most favorable to Plaintiff — a reasonable factfinder could conclude Plaintiff’s reports to his supervisor and other personnel put BofI on actual or constructive notice of his protected activity under § 1514A.
Related USDOL Case: ALJ No. 2018-SOX-00034
Casenote(s):
ADVERSE PERSONNEL ACTION; INFORMING EMPLOYEE OF IMPLICATIONS OF EXTENDED LEAVE
ADVERSE PERSONNEL ACTION; INFORMING CLIENTS OF FINANCIAL ADVISOR WHO WAS ON EXTENED LEAVE THAT HIS ACCOUNTS HAD BEEN REASSIGNED
ADVERSE PERSONNEL ACTION; FAILING TO INVESTIGATE PLAINTIFF’S COMPLAINT OF SECURITIES LAW VIOLATIONS; PLAINTIFF’S ALLEGATION OF RESULTANT DIVORCE FROM HIS WIFE
ADVERSE PERSONNEL ACTION; NOT PROVIDING INFORMATION TO PLAINTIFF’S COUNSEL TO ASSIST IN PLAINTIFF’S FORMULATION OF A SETTLEMENT DEMAND
ADVERSE PERSONNEL ACTION; CONSTRUCTIVE DISHARGE NOT PLAUSIBLY ALLEGED WHERE PLAINTIFF CONFUSED UNEMPLOYMENT WITH SELF-IMPOSED EXILE
In Mohan v. UBS Fin. Servs., No. 19-cv-00663 (D. Conn. Mar. 17, 2020) (2020 U.S. Dist. LEXIS 45817), the court dismissed Plaintiff’s complaints for failure to allege facts that plausibly entitled him to relief. The dismissal was subject to reopening if Plaintiff filed an amended complaint sufficient to overcome the deficiencies.
The court detailed Plaintiffs allegations. In brief, Plaintiff was a financial advisor for UBS Financial Services, Inc. (UBSFS) since 2011. From 2015 to 2016 he submitted complaints alleging violations of securities laws to UBSFS’s compliance department and to the SEC. Plaintiff alleged that afterwards UBSFS began to interfere with Plaintiff’s business development activities, and̬while Plaintiff was on disability leave in December 2016—advised Plaintiff that he was at risk of termination. In January 2017, Plaintiff sent a letter to three management officials alleging violations of various securities statutes and regulations. In June 2017, Plaintiff and his counsel had a three-hour conference call with UBSFS’s executive director and senior counsel detailing serious financial harms incurred by Plaintiff’s clients owing to alleged SEC regulatory violations by UBSFS. Defendant’s in-house counsel launched an investigation but repeatedly did not communicate with Plaintiff’s counsel, including about that counsel’s request for short-term disability benefit base calculations for formulation of a settlement demand. In August 2017, Plaintiff emailed UBSFS’s senior counsel reminding her that he had not gotten a substantive response, and stating that he was considering informing clients of the violations. In the meantime, while on disability leave in April 2017, Plaintiff heard reports that his clients had received letters from UBSFS stating that he was no longer with the firm. In November 2017 Plaintiff’s wife enrolled him in her health care plan—but UBSFS failed to stop withdrawing insurance premiums from his checking account causing him to incur overdraft fees. In July 2017, Plaintiff filed complaints with the USDOL, the EEOC and a state agency alleging discrimination and retaliation. Plaintiff averred that during the USDOL hearing, he concluded that the ALJ would be setting an unreasonably high burden and had little knowledge of securities law, and he thus decided to seek de novo review in Federal district court. In an amended complaint, Plaintiff alleged, inter alia, violation of the Section 806 of the Sarbanes-Oxley Act (SOX).
In regard to the SOX claim, the court focused on whether Plaintiff suffered an unfavorable personnel action. Plaintiff alleged five actions taken against were in retaliation for securities related whistleblowing.
(1) Informing Plaintiff that he was “at risk of termination”
The court rejected Defendants’ contention that “threats to terminate employment are not actionable under section 806 unless they ripen into concrete action,” slip op. at 8 (citation omitted), but agreed with their argument that it was implausible that Plaintiff was threatened with termination because he had merely been provided a form letter advising him that he was approaching the end of his short-term disability leave allowance, that his position could not be held open indefinitely, and that UBSFS within the next six months may decide to terminate him after assessing his ability to return to work. Id. at 8-9, citing Pierre v. Napolitano, 958 F. Supp. 2d 461, 476 (S.D.N.Y. 2013) (informing employee of ‘implications of his extended leave of absence’ is not ‘threatening’).”
(2) Notifying Plaintiff’s clients that he was “no longer with the firm”
The court determined that “even if UBSFS informed Mohan’s clients while he was on medical leave that he was ‘no longer with the firm,’ that is not a plausible unfavorable personnel action.” Id. at 9. The court stated that this action was equally consistent with the innocent explanation that any notice Plaintiff’s clients received “would have been a stock notice that a new financial adviser was assigned to their accounts.” Id. The court stated that “even if there was some insidious motive behind the action, it is not clear how Mohan suffered from it in his employment. Had he returned to UBSFS and found he would be servicing fewer or less valuable accounts, he might have had a claim. But Mohan does not allege that; he was servicing the same number of accounts shortly before and after his clients were noticed: none at all. See McGrath v. Thomson Reuters, 2012 WL 2119112, at *12 (S.D.N.Y. 2012) (“Reassignment of the plaintiff’s clients while he was on medical leave . . . was not an adverse employment action”), report and recommendation adopted, 2012 WL 2122325 (S.D.N.Y. 2012), aff’d, 537 F. App’x 1 (2d Cir. 2013); Torres-Alman v. Verizon Wireless Puerto Rico, Inc., 522 F. Supp. 2d 367, 395-96 (D.P.R. 2007) (no reasonable jury could find retaliation where plaintiff’s clients were only reassigned when he was on disability leave).”
(3) Inadequately investigating Plaintiff’s allegations of securities laws violations
The court stated that “failing to investigate an employee’s complaint of misconduct is not actionable retaliation absent circumstances not present here. See Fincher v. Depository Tr. & Clearing Corp., 604 F.3d 712, 721-22 (2d Cir. 2010) (“An employee whose complaint is not investigated cannot be said to have thereby suffered a punishment for bringing that same complaint,” unless somehow “the failure [to investigate] is in retaliation for some separate, protected act by the plaintiff.”); see also Volpe v. Conn. Dep’t of Mental Health & Addiction Servs., 88 F. Supp. 3d 67, 75 (D. Conn. 2015) (collecting cases).” Id. at 9-10. The court also stated that Plaintiff had not shown that “he was entitled to the fruits of any internal investigation into his allegations by UBSFS.” Id. at 10 (citations omitted). The court also determined that even if Defendants’ failure to address his complaints led to Plaintiff’s divorce “it is not clear how that negative impact on his personal life affected him in his employment. Cf. Allovio v. Holder, 923 F. Supp. 2d 151, 158 (D.D.C. 2013) (‘While [plaintiff] . . . believes that the position changes contributed to his divorce, . . . such unfortunate circumstances do not rise to the level of a materially adverse employment action affecting the terms, conditions, or privileges of employment’).”
(4) Refusing to provide information to Plaintiff’s counsel so that he could formulate a settlement demand
The court determined that “it was well within the rights of UBSFS’s counsel to refuse to provide Mohan’s counsel his short-term disability benefit base in order to facilitate formulation of a settlement demand. Counsel took a ‘[r]easonable defensive measure[]’ in clear anticipation of litigation, and did so in a way that did not affect Mohan’s ‘work, working conditions, or compensation.’ United States v. N.Y.C. Transit Auth., 97 F.3d 672, 677 (2d Cir. 1996); see also Adams v. Northstar Location Servs., LLC, 2010 WL 3911415, at *3 n.2 (W.D.N.Y. 2010) (‘denial of plaintiff’s access to payroll records’ was not adverse employment action because it ‘did not effect a materially adverse change in the terms and conditions of plaintiff’s employment’).”
(5) Constructive discharge
Before discussing the individual retaliation claims, the court first addressed Plaintiff’s claim of constructive discharge even though his complaint alleged that he was still employed by Defendant. The court concluded that Plaintiff appeared to have confused “unemployment” with a self-imposed exile from work due to a number of factors. The court determined that he failed to plausibly allege that he was discharged, constructively or otherwise, citing Fox v. Costco Wholesale Corp., 918 F.3d 65, 72 (2d Cir. 2019) (“indefinite medical leave” is not a discharge).
Casenote(s):
PROTECTED ACTIVITY; TO SURVIVE A MOTION FOR SUMMARY JUDGMENT, A SOX COMPLAINT ALLEGING SHAREHOLDER AND MAIL OR WIRE FRAUD MUST SHOW THAT COMPLAINANT WHEN REPORTING THE COMPLAINED OF CONDUCT HELD A REASONABLE BELIEF THAT THERE HAD BEEN A MATERIAL MISREPRESENTATION OR OMISSION WITH AN INTENT TO DECEIVE
In Sturdivant v. Chem. Waste Mgmt., No. 19-cv-1129 (N.D. Ala. Mar. 4, 2020) (2020 U.S. Dist. LEXIS 38264; 2020 WL 1083212), Plaintiff, an Operations Manager at one of Defendant’s hazardous waste facilities, filed a SOX complaint alleging that Defendant violated the retaliation provision of the Sarbanes-Oxley Act by failing to report environmental violations to state and federal authorities, as well as shareholders, which he contended was mail fraud, wire fraud and shareholder fraud.
Defendant filed a motion for summary judgment. The Magistrate Judge, viewing the complaint in the light most favorable to Plaintiff, found that its allegations were scant and conclusory, and asked the court to simply assume that Defendant’s “environmental violations and its failure to report those violations to regulatory authorities and its shareholders necessarily means that it committed mail fraud, wire fraud, or shareholder fraud.” Slip op. at 11. The Magistrate stated: “Where Sturdivant’s complaint falls short is in its failure to explain how, specifically, he reasonably believed one of these particular violations occurred. Without connecting these dots, Sturdivant’s allegations are properly characterized as a garden-variety ‘complaint about possible improper or even illegal conduct.’ Northrop Grumman, 927 F.3d at 229.” Id. The court elaborated on the need of the complaint to allege the Plaintiff held a reasonable belief when reporting the complained of conduct that there had been a material misrepresentation or omission with an intent to deceive, in order to make out a case of shareholder or mail or wire fraud.
“Shareholder fraud involves false representations of material fact intended to deceive shareholders and reliance by shareholders on those false representations to their detriment.” Id. at 233. The elements of a claim for shareholder fraud are a material misrepresentation or omission with the specific intent to deceive; a connection to the purchase or sale of a security; and reliance, economic loss, and a causal connection between the misrepresentation and loss. Id. None of Sturdivant’s factual complaints include all or even most of these elements. Instead, he asks the court to read the elements of shareholder fraud into the conduct he actually complained of—violations of state and federal environmental laws and regulations.
The same goes for mail or wire fraud. “Aside from the means by which a fraud is effectuated, the elements of mail fraud, 18 U.S.C. § 1341, and wire fraud, 18 U.S.C. § 1343, are identical.” United States v. Ward, 486 F.3d 1212, 1221 (11th Cir. 2007). Both “require that a person (1) intentionally participates in a scheme or artifice to defraud another of money or property, and (2) uses or causes the use of the mails or wires for the purpose of executing the scheme or artifice.” Id. at 1222 (internal quotation marks omitted). The first element “requires proof of a material misrepresentation, or the omission or concealment of a material fact calculated to deceive another out of money or property.” United States v. Maxwell, 579 F.3d 1282, 1299 (11th Cir. 2009). “A misrepresentation is material if it has a natural tendency to influence, or is capable of influencing, the decision maker to whom it is addressed.” Id. (internal quotation marks omitted). Again, none of Sturdivant’s allegations center on conduct that relates to the elements of wire and mail fraud. The court cannot assume that Sturdivant’s allegedly reasonable belief that CWM violated state and federal environmental laws and regulations necessarily results in a reasonable belief that CWM’s actions conformed with the statutory definition of mail or wire fraud. Indeed, while he may have earnestly believed that he was reporting some form of misconduct, there is nothing in the complaint to suggest that Sturdivant specifically believed CWM committed mail or wire fraud.
Rhinehimer, 787 F.3d at810. Rather, “[t]he well-established intent of Congress supports abroad reading of the statute’s protections.” Id. Accordingly, “an interpretation demanding a rigidly segmented factual showing justifying the employee’s suspicion undermines [Sarbanes-Oxley’s] purpose and conflicts with the statutory design, which turns on employees’ reasonable belief rather than requiring them to ultimately substantiate their allegations.” Id. Even so, Sturdivant must specifically allege that he had a reasonable belief that CWM was committing one of the six categories of fraud enumerated in Sarbanes-Oxley’s antiretaliation provision when he reported the misconduct o his supervisors.
Id. at 11-13 (footnote omitted). The Magistrate granted Defendant’s motion to dismiss without prejudice to amend the complaint to cure its deficiencies.
Casenote(s):
SOX COMPLAINT SEEKING PROTECTIVE ORDER TO STOP ALLEGED CYBER BULLYING DISMISSED BY COURT SUA SPONTE WHERE THE COMPLAINT WAS FRIVOLOUS, SUCH RELIEF WAS NOT AVAILABLE UNDER SOX AND DODD-FRANK, AND PRO SE PLAINTIFF WAS ALREADY UNDER FILING RESTRICTIONS DUE TO HER LITIGATION HISTORY
In Jones v. Adams, No. 19-cv-979 (W.D. OK. Jan. 15, 2020) (2020 U.S. Dist. LEXIS 6867; 2020 WL 236740), the court dismissed, sua sponte, Plaintiff’s pro se SOX and Dodd-Frank claims as frivolous under FRCP 12(b)(6). Plaintiff sought a protective order under the SEC Whistleblower Protection Program to prevent Defendants (who the court noted were attorneys who had represented Plaintiff’s ex-husband in litigation against Defendant) from acting as “cyber bullies” and to require them to have no contact with her whatsoever. Plaintiff alleged that Defendants had begun posting online that they were selling cyber currency. Although Plaintiff had not specified the statutory authority for this this program, the court noted that whistleblowers who report violations of securities law are protected by the Sarbanes-Oxley Act of 2002 and the Dodd-Frank Wall Street Reform and Consumer Protection Act. The court noted, however, that the complaint’s factual allegations did not state circumstances protected by those laws—and that neither SOX nor Dodd-Frank provides for protective orders such as Plaintiff was seeking. Although Plaintiff’s complaint alleged that she had provided information to the SEC Whistleblower Program, she had not alleged information related to a securities law violation or that she had suffered employment retaliation for proving the information. The court also dismissed a False Claims Act count of the complaint.
The court noted Plaintiff’s pro se status, but determined that permitting amendment to the complaint would be futile. The court also noted that Plaintiff was already under filing restrictions due to her litigation history, and had been admonished that her history of meritless positions went beyond what might be excused based lack of training in the law.
USDOL Case: ARB No. 16-095, ALJ No. 2015-SOX-00025
Casenote(s):
The court dismissed Petitioner’s petition for review of an ARB decision. The court found that the ARB properly affirmed the dismissal of Petitioner’s SOX retaliation complaint because she failed to establish a prima facie case. The court also found that the ARB did not err by denying Petitioner’s request to admit new evidence because she failed to demonstrate that the evidence could not have been discovered with reasonable diligence before the record closed. See 29 C.F.R. § 18.90(b)(1).
Case below: ARB Nos. 15-038, 15-040, 16-014; ALJ No. 2012-SOX-37
Casenote(s):
COURT OF APPEALS REVIEW; PETITIONS FOR REVIEW CONCERNING DOL’S ORDERS ON SCOPE OF RELIEF AND ATTORNEY’S FEES AWARDED TO COMPLAINANT WERE MOOT WHERE COURT HAD, IN AN EARLIER DECISION, FOUND IN FAVOR OF RESPONDENT
In Seguin v. United States Dep’t of Labor, No. 17-1887, No. 17-2259 (4th Cir. Jan. 9, 2020) (per curiam) (unpublished) (2020 U.S. App. LEXIS 897), the Fourth Circuit denied Seguin’s motion to hold in abeyance her petitions for review of DOL orders relating to her SOX whistleblower protection action pending a petition for writ of certiorari she indicated she intended to file on the court’s related decision in Northrop Grumman Systems Corp. v. United States Department of Labor, 927 F.3d 226, 236 (4th Cir. 2019). The court denied the motion to hold the petitions in abeyance because the time for filing a cert petition on the earlier case had expired without Seguin filing such a petition. The court then dismissed Seguin’s petitions for review, which were about scope of relief and attorney’s fees, finding that these matters were moot in view of the court’s earlier decision in Northrop Grumman, remanding the case with instructions to the ALJ to dismiss the administrative complaint and enter judgment in favor of Northrop.
Related USDOL Case: ARB No. 2018-0078, ALJ No. 2012-STA-00061
Casenote(s):
The Fourth Circuit denied Carter’s petition for review of the ARB’s Final Decision and Order affirming the ALJ’s Decision and Order on Remand denying Carter’s STAA complaint of retaliatory discharge. The court found that the ALJ properly considered the deficiencies in his initial decision that were highlighted in a prior opinion by the Fourth Circuit in Carter v. CPC Logistics, Inc., 706 F. App’x 794 (4th Cir. 2017) (No. 17-1095). The court found that substantial evidence supported the finding that Carter’s protected activity was not a causal factor in his discharge; that Carter’s delays were not due to reported fatigue breaks; and that Carter was discharged due to several factors, none of which involved a protected activity.
Related USDOL Case: ARB No. 2017-0080, ALJ No. 2016-STA-00007
Casenote(s):
[STAA Digest II H 5 a]
BRIEFING BY PRO SE PARTY; ARGUMENTS BASED ENTIRELY ON CONCLUSORY STATEMENTS ARE DEEMED ABANDONED; IF APPELLANT URGES ON APPEAL THAT A FINDING OR CONCLUSION IS UNSUPPORTED BY THE EVIDENCE OR CONTRARY TO THE EVIDENCE, APPELLANT MUST INCLUDE IN THE RECORD A TRANSCRIPT OF ALL RELEVANT EVIDENCE[STAA Digest VI B 1]
ADVERSE EMPLOYMENT ACTION; FINDING THAT APPELLANT VOLUNTARILY RESIGNED SUPPORTED BY SUBSTANTIAL EVIDENCE IN THE FORM OF AN EMAIL SENT TO HIS EMPLOYER, AND EVIDENCE THAT APPELLANT HAD THE CHOICE TO CONTINUE DISCUSSIONS WITH EMPLOYER OR TO RESIGN VOLUNTARILY[STAA Digest VI A]
ADVERSE EMPLOYMENT ACTION; MERE ALLEGATIONS THAT EMPLOYER FAILED TO PAY FOR CERTAIN FREIGHT SERVICES, IGNORED APPELLANT’S EMAILS, AND THAT TRUCK LEASE VIOLATED FEDERAL LAW, DID NOT ESTABLISH A MATERIALLY ADVERSE ACTION THAT WOULD DISSUADE APPELLANT FROM MAKING A WHISTLEBLOWER COMPLAINTIn Jacobs v. United States Dept. of Labor, No. 19-11832 (11th Cir. Mar. 24, 2020) (per curiam) (unpublished) (2020 U.S. App. LEXIS 9123), the Fourth Circuit found that Jacobs, proceeding pro se on appeal of the ARB’s summary affirmance of the ALJ’s decision and order denying his STAA claim, “abandoned his arguments regarding the ALJ’s finding that he voluntarily resigned, because he fails to support his argument with anything beyond conclusory statements in his briefs. See Timson v. Sampson, 518 F.3d 870, 874 (11th Cir. 2008) (stating issues not briefed on appeal by a pro se litigant are deemed abandoned).” In addition, Jacobs “failed to include a complete transcript of his hearing before the ALJ. See Fed. R. App. P. 10(b)(2) (providing ’[i]f the appellant intends to urge on appeal that a finding or conclusion is unsupported by the evidence or is contrary to the evidence, the appellant must include in the record a transcript of all evidence relevant to that finding or conclusion’).”
Moreover, the court found that substantial evidence supported the ALJ’s finding of a voluntary resignation. Appellant had sent an email to his employer stating that he “rescinded” all agreements with the employer, requesting to be paid for all services up to that time, stating that he would return his truck for final inspection, and stating that a meeting would no longer be necessary. The court stated:
Thus, he had the choice to continue his discussions with Liberty about his grievances or terminate his employment. See Hargray v. City of Hallandale, 57 F.3d 1560, 1568 (11th Cir. 1995) (stating a resignation is voluntary as long as the employee had a choice, even if the alternatives are unpleasant). Jacobs chose to voluntarily resign, which shows he was not constructively discharged or subject to a materially adverse employment action. See id. Accordingly, because Jacobs voluntarily resigned, we deny the petition as to this issue.
The court also found that Appellant abandoned argument supported only by conclusory statements that his employer failed to pay him, that the employer ignored his emails, and that his truck lease violated federal law. The court declined to consider arguments about his employer’s failure to pay him a signing bonus because that issue was raised for the first time on appeal. The court ruled that even if he had not abandoned his arguments, Appellant did not show that his employer subjected him to a materially adverse action. The court stated: “He did not offer evidence showing that Liberty failed to pay him for 3,081 miles of freight services or explain how such a failure would dissuade a reasonable worker from making or supporting a charge of discrimination. Further, the record was clear that Liberty replied to his emails, and he also failed to show how ignoring emails would equate to a materially adverse action. Lastly, although Jacobs repeatedly states that his truck lease violated federal law, he does not show how the lease violated federal law or how such a violation would be a materially adverse action that would dissuade him from making a whistleblower complaint.” Id. at 4-5 (citations omitted).