Whistleblower Fired for Disclosing Improper Asbestos Removal Wins at Trial

A jury awarded approximately $174,00 to a whistleblower who was fired for reporting improper asbestos removal practices at asbestos abatement and demolition company Champagne Demolition, LLC.  OSHA brought suit on his behalf under Section 11(c) of the Occupational Safety and Health Act, and the jury awarded $103,000 in back wages, $20,000 in compensatory, and $50,000 in punitive damages.  The jury instructions are available here.

According to the complaint, the company fired the whistleblower one day after he raised concerns about improper asbestos removal at a high school in Alexandria Bay, NY, and entered the worksite when it was closed to take pictures of the asbestos. The whistleblower also removed a bag containing the improperly removed asbestos.  A few weeks after Champagne Demolition terminated the whistleblowers’ employment, they sued him for defamation.  Champagne Demolition subsequently stipulated to the dismissal of the defamation claim.  OSHA alleged that both the termination of the whistleblower’s employment and the filing of a defamation action were retaliatory acts prohibited by Section 11(c) of the Occupational Safety and Health Act.

Although for procedural reasons the court did not rule on whether the filing of the defamation action against the whistleblower was retaliatory, the Secretary’s motion for summary judgment   stakes out an important position on retaliatory lawsuits against whistleblowers:

Lawsuits filed with the intent to punish or dissuade employees from exercising their statutory rights are a well- established form of adverse action. See BE & K Constr. Co. v. NLRB, 536 U.S. 516, 531 (2002) (Finding that a lawsuit that was both objectively baseless and subjectively motivated by an unlawful purpose could violate the National Labor Relations Act’s prohibition on retaliation); Torres v. Gristede’s Operating Corp., 628 F. Supp. 2d 447, 472 (S.D.N.Y. 2008) (“Courts have held that baseless claims or lawsuits designed to deter claimants from seeking legal redress constitute impermissibly adverse retaliatory actions.”); Spencer v. Int’l Shoppes, Inc., 902 F. Supp. 2d 287, 299 (E.D.N.Y. 2012) (Under Title VII, the filing of a lawsuit with a retaliatory motive constitutes adverse action).

OSHA should be commended for taking the case to trial and obtaining punitive damages.  As approximately 4,379 workers in the U.S. are killed annually due to unsafe workplaces, it is critical for OSHA to vigorously enforce Section 11(c) of the Occupational Safety and Health Act and counter retaliatory lawsuits against whistleblowers, an especially pernicious form of retaliation.

 

© 2017 Zuckerman Law
Written by Jason Zuckerman of Zuckerman Law.
Read more on court decisions on the National Law Review’s Litigation page.

Yoga and Massage Therapist Fired for Being “Too Cute” Sees Gender Discrimination Revived on Grounds of Unjustified Spousal Jealousy

A New York appeals court recently ruled in Edwards v. Nicolai (153 A.D.3d 440 (N.Y. App. Div. 1st Dep’t 2017)) that an employment termination motivated by the sexual jealousy of an employer’s spouse may support a claim for gender discrimination under the New York State Human Rights Law (“NYSHRL”) and the New York City Human Rights Law (“NYCHRL”).

Defendants Charles Nicolai and his wife Stephanie Adams – a former Playboy model – were co-owners of a chiropractic center located in New York City. In 2011, Nicolai hired plaintiff Dilek Edwards, a female yoga and massage therapist, and was her direct supervisor. Edwards’s complaint alleged that during the course of her employment, her relationship with Nicolai was “purely professional” and that Nicolai “regularly praised [her] work performance.”

However, in June 2013, Nicolai purportedly told Edwards “that his wife might become jealous of [her], because [Edwards] was too cute.” Several months later, Adams sent plaintiff a text message saying, “You are NOT welcome any longer at Wall Street Chiropractic, DO NOT ever step foot in there again, and stay the [expletive] away from my husband and family!!!!!!! And remember I warned you.” A few hours later, Edwards allegedly received an email from Nicolai stating, “You are fired and no longer welcome in our office. If you call or try to come back, we will call the police.” One day later, Adams filed an allegedly false complaint with the New York City Police Department claiming that Edwards placed “threatening” phone calls to Adams which caused Adams to change the locks at her home and business. Edwards’s complaint alleges that she has “no idea what sparked . . . Adams’ [sic] suspicions.”

Edwards’s NYSHRL and NYCHRL gender discrimination claims were dismissed at the trial court level. However, that decision was overturned on appeal, with the court holding that “adverse employment actions motivated by sexual attraction are gender-based, and therefore, constitute unlawful gender discrimination.” The court explained that while Edwards does not allege that she was subjected to sexual harassment, it can be inferred that Nicolai was motivated to terminate Edwards “by his desire to appease his wife’s unjustified jealousy.” Further, it can also be inferred that Adams was motivated to terminate Edwards based on Adams’s own jealousy. Accordingly, the court found it plausible that each defendant’s motivation to terminate Adams was sexual in nature and therefore unlawful.

In reaching its decision the court observed that, “while it is not necessarily unlawful for an employer to terminate an at-will employee at the urging of the employer’s spouse,” a plaintiff may find relief for such a discharge if the spouse requested the termination for unlawful, gender-related reasons. Here, assuming Edwards’s allegations are true, her termination was unlawful not because Adams asked Nicolai to fire Edwards, but because she did so for no other reason than her belief that Nicolai was sexually attracted to Edwards.

Laura Doyle contributed to this post.

This post was written by Jonathan Sokolowski of Sheppard Mullin Richter & Hampton LLP., Copyright © 2017
For more Labor & Employment legal analysis, go to The National Law Review

Sears Seeks to Modify FTC Order on Online Tracking

In 2009, Sears Holding Management settled with the Federal Trade Commission (FTC) over allegations that the company’s online tracking activity exceeded what they told consumers. Now, Sears has submitted a petition requesting that the FTC reopen and modify its settlement order, arguing that changing technology since 2009 has made the order’s definition of “tracking applications” too broad and has put them at a competitive disadvantage.

The 2009 FTC complaint charged that Sears “failed to disclose adequately the scope of consumers’ personal information it collected via a downloadable software application, telling consumers that the software would track their “online browsing,” without telling them that it also collected information from third-party websites consumers visited such as their shopping cart information, online bank statements, and drug prescription records. Sears was required to stop collecting data from participating consumers and to destroy what they’d collected.

Sears now argues that the definition of “tracking application” in the FTC’s order now applies to most software on nearly all platforms, making them “out of step with current market practices without a corresponding benefit in combatting threats to consumer privacy.” The definition of tracking applications is so broad, Sears claims, that it “encompasses all of Sears’ current mobile apps, forcing Sears to handle disclosures differently than other companies with mobile apps and disadvantaging Sears in the marketplace.” Sears claims that modification of the order would allow the retailer to align with current tracking practices used by their competitors.

 This post was written by Sheila A. Millar ,Tracy P. Marshall Nathan A. Cardon of Keller and Heckman LLP.,© 2017
For more legal analysis, go to The National Law Review 

Construction Liens on Leased Commercial Premises

In general, a contractor or supplier is entitled to file a lien against a commercial property if they have performed work or provided materials pursuant to a written contract with the owner. These lien claims must be filed within 90 days of the last date of providing materials or services for the project.

On the other hand, if a contractor or supplier is providing materials or services for a tenant of a commercial property, the rules are different. The differences as to what the lien may attach to are discussed in detail below.

If the tenant of the property entered into a contract for the improvement of the property and the owner directly authorized the improvement in writing, the lien may attach to the real property. The proper way to ensure that a lien may attach to the real property is to have the owner of the property sign off on and approve any contract for the improvement of the real property.

As a contractor or supplier, it is suggested that you obtain the owner’s authorization which would thereby allow you to assert a lien claim against the property itself in the event of non-payment. This can become a very powerful tool on collecting an unpaid balance, as an action to foreclose upon the lien could be brought. This would place a great deal of pressure on the tenant to pay the outstanding balance.

Conversely, if the owner of the property does not sign off on or agree to the improvement to the real property, a lien claim would only attach to the lease hold interest of the tenant. Under these circumstances, the lien claim would not attach to the real property itself, but instead, solely to the lease hold interest held by the tenant.

The question then becomes what would be the value of the lease hold interest.

Depending upon the use of the property by the tenant, the lease hold interest could be quite valuable, or it may be close to worthless. Obviously, if the tenant is fully invested in the property the lien claim may carry substantial value, as it may force the tenant to satisfy the claim. Then again, if the lease hold interest is solely an office or two within a commercial property the lien claim may not possess significant value.

The above provides a general overview as to a lien claim on a commercial property which is occupied by a tenant. It is suggested, as a contractor or supplier, that you have the owner sign off for improvements. This gives you greater leverage when attempting to collect on a lien claim, and also, could force the sale of the property to satisfy same.

This post was written by Paul W. Norris of STARK & STARK.,COPYRIGHT © 2017
For more Construction & Real Estate legal analysis, go to The National Law Review

CNN Investigates Expanding Use of Nuedexta in Nursing Homes

A recent investigation by CNN brought to light the expanding and allegedly inappropriate use of the prescription drug Nuedexta in nursing homes throughout the country. Nuedexta is FDA-approved to treat a rare condition known as pseudobulbar affect (PBA).

What is Pseudobulbar Affect?

Pseudobulbar affect is characterized by sudden and uncontrollable laughing or crying. It is associated with people who have multiple sclerosis (MS) or amyotrophic lateral sclerosis (ALM), known as Lou Gehrig’s disease. Avanir Pharmaceuticals has been aggressively targeting elderly nursing home residents with the drug, the CNN investigation found, although PBA reportedly impacts less than 1 percent of Americans, based on a calculation using the drug maker’s own figures.

What the Investigation Revealed

Nuedexta prescription use in nursing homes is rising at a rapid rate, even though Avanir Pharmaceuticals acknowledges that the drug has not been extensively studied in elderly patients, according to CNN.

CNN found that Avanir Pharmaceutical’s sales force is focused on expanding the drug’s use among elderly patients suffering from dementia and Alzheimer’s disease, coupled with “high-volume prescribing and advocacy efforts by doctors receiving payments from the company.”

Since 2012, more than half of all Nuedexta pills have gone to long-term care facilities, according to data obtained from QuintilesIMS, which tracks pharmaceutical sales. Total sales of Nuedexta reached almost $300 million that year.

In response to requests to be interviewed for the CNN article, Avanir reportedly responded by email with a statement that PBA is often “misunderstood” and that the condition can affect people with dementia and other neurological disorders that are common in nursing home residents.

Nuedexta is approved by the Food and Drug Administration (FDA) to treat anyone with PBA, including those with neurological conditions such as dementia. But geriatric physicians, dementia researchers, and other medical experts reportedly told CNN that PBA is extremely rare in dementia patients.

How Can Nuedexta Impact Nursing Home Residents?

One study of 194 patients with Alzheimer’s disease found that patients taking Nuedexta suffered more than twice as many falls as those patients taking a placebo.

CNN reports that Lon Schneider, director of the University of Southern California’s California Alzheimer’s Disease Center, reviewed information from several hundred reports obtained by CNN through the Freedom of Information Act. Schneider expressed concern about potential interactions between Nuedexta and other medications intended to treat problematic behaviors. These medications may include antipsychotic drugs, antidepressants, and anti-anxiety medication which are often given to nursing home residents to suppress anxiety or aggression that may occur with Alzheimer’s disease and other dementia types.

Why Are Doctors Prescribing Nuedexta to Nursing Home Residents?

According to CNN’s analysis of government data, between 2013 and 2016, Avanir and its parent company, Otsuka, paid almost $14 million to physicians for Nuedexta-related consulting, promotional speaking, and other services. The companies also spent $4.6 million on travel and dining costs. CNN found that in 2015 nearly half the Nuedexta claims filed with Medicare came from doctors who had received money or other perks.

According to the investigation, state regulators have found that doctors may inappropriately diagnose nursing home residents with PBA to justify the use of Nuedexta to treat confusion, agitation, and unruly behavior. Further, doctors may inappropriately diagnose nursing home residents with PBA to justify the use of Nuedexta to treat confusion, agitation, and unruly behavior. A diagnosis of PBA may be used because “off-label” prescriptions written by doctors using Nuedexta to treat patients who have not been diagnosed with PBA would typically not be covered by Medicare.

What Adverse Events Have Been Reported With Nuedexta Use By Nursing Home Patients?

Soon after Nuedexta came on the market, doctors, nurses, and nursing home patients’ family members began filing reports including rashes, dizziness, and falls as well as comas and death. CNN found that Nuedexta was listed as a “suspect” medication in nearly 1,000 adverse event reports received by the FDA. These reports disclosed side effects, drug interactions, and other issues. According to CNN, the FDA declined to comment on adverse events or the approval process for Nuedexta.

This post was written by Denise Mariani  of STARK & STARK, COPYRIGHT © 2017
For more legal analysis, go to The National Law Review

Education Secretary Signals Shift in Title IX Policy for Dealing with Sexual Misconduct Allegations

On September 7, 2017, Secretary of Education, Betsy DeVos announced a marked policy shift in how the Department of Education will approach Title IX enforcement with regard to sexual misconduct. DeVos indicated that the Department plans to withdraw the controversial Dear Colleague Letters issued during the Obama administration. Instead, the Department will issue formal regulations that will establish a new Title IX framework for educational institutions investigating and responding to sexual misconduct allegations. The full text of Secretary DeVos’s speech can be found here.

Title IX has been a dominant topic in higher education since 2011, when the Obama Administration issued the “Dear Colleague Letter” explaining that a failure to adequately address sexual misconduct on campus constituted discrimination on the basis of sex in education programs under Title IX.[1] Among other things, the Dear Colleague Letter set forth how schools should respond to sexual misconduct, dictated specific procedures schools must follow to investigate and adjudicate such misconduct, and established various other requirements such as climate surveys, standards of proof, and survivor sensitivity. The Letter made clear that a failure to meet these expectations, and the expanded guidance issued by the Department in 2014, could result in a loss of federal funding, and thus had a swift and substantial impact on the way educational institutions responded to reports of sexual assault or harassment.

In a speech at the George Mason University School of Law on September 7, 2017, Secretary DeVos said that schools will still be required to address sexual misconduct. However, she announced the Department would be rescinding the Dear Colleague Letters and instead regulate through actual regulations, subject to notice and comment. Secretary DeVos lamented that “for too long, rather than engage the public on controversial issues, the Department’s Office for Civil Rights has issued letters from the desks of un-elected and un-accountable political appointees.” She made it clear that “the era of ‘rule by letter’ is over.” DeVos emphasized the Department’s ongoing commitment to protecting victims of sexual violence. But she also clearly signaled that the Department will pay more attention to the due process rights of the accused, including questioning the “preponderance of the evidence” standard that the Department required all schools to use in adjudicating sexual misconduct cases. DeVos promised to work more closely with educational institutions, rather than operating “through intimidation and coercion.” And she said the Department would be open to exploring alternative methods of enforcing Title IX, including the possibility of voluntary regional centers where outside professionals would be available to handle Title IX investigations and adjudications.

DeVos did not indicate exactly what the new Department rules might entail, or when they will come into effect, nor has there been an official withdrawal of the Dear Colleague Letter yet. DeVos did indicate, however, that the Department will base the new rules on public feedback and will take into account the views of educational institutions, professionals, and individual students. In her closing remarks, DeVos noted that the Department of Education’s “interest is in exploring all alternatives that would help schools meet their Title IX obligations and protect all students. [The Department] welcome[s] input and look[s] forward to hearing more ideas.”[2]

Schools should take advantage of the Secretary’s call for comments, as the Department moves towards the development and implementation of a different and hopefully clearer set of rules governing the enforcement of Title IX. However, schools should also anticipate a period of uncertainty until final rules are issued. Moreover, schools should be aware of the continuing (and possibly conflicting) state law obligations that have been put into place following the Dear Colleague Letter. For example, many states including Connecticut and New York have passed legislation mandating use of the preponderance of the evidence standard in evaluating sexual misconduct on college campuses. We anticipate further, more detailed guidance in the next few weeks as the Department of Education works to implement Secretary DeVos’s policy announcements.


[1] 20 U.S.C. §§ 1681 et seq.; 34 C.F.R. Part 106.

[2] Secretary DeVos Prepared Remarks on Title IX Enforcement, available here.

 This post was written by Benjamin DanielsAaron Bayer, & Dana M. Stepnowsky of Wiggin and Dana LLP., © 1998-2017

The Supreme Court Enters the Digital Age

Electronic filing is coming to the U.S. Supreme Court! Effective November 13, 2017, amendments to the Supreme Court’s rules take effect that require represented parties (and their amici) to submit petitions, briefs, and most other filings through the Court’s electronic filing system. The Rules explain that the new e-filing requirements are “[i]n addition to the filing requirements” already set forth in the Rules. Accordingly, parties and their amici will still be required to submit forty copies of their briefs on paper in booklet form, and they now must additionally submit one paper copy on 8.5 x 11 inch paper (in case the Clerk’s office needs to scan the brief for any reason). The paper submission remains the “official filing” for purposes of determining timeliness, but e-filing is supposed to occur “contemporaneously” with the paper filing. Pro se parties will continue to file submissions exclusively on paper; those submissions will be scanned by the Clerk’s office and posted on the Court’s web site.

Attorneys practicing before the Supreme Court will be required to register for an account on the Court’s electronic filing system. The Court warns that it could take two days for a new account to be approved, so attorneys should register well in advance of a filing deadline. Attorneys of record will also now be required to file notices of appearance using the Court’s e-filing system. Under the previous regime, the submission of a brief with an attorney’s information constituted a notice of appearance. Now, an attorney need not file a notice of appearance to submit a case-initiating document, such as a cert petition, but must make an appearance before filing any other document.

While the advent of e-filing creates a few new procedural hurdles, it also presents some obvious benefits to litigators. Primarily, all documents e-filed with the Court will be made available to the public free of charge, which will make it easier to access briefs and petitions filed in other cases. Moreover, counsel who enter an appearance will receive immediate notifications of any activity in the case. Under the old system, a party would not learn of an adversary’s filing until it arrived on paper by courier sometimes three days later, unless opposing counsel was courteous and emailed a courtesy copy.

E-filed documents will be posted immediately to the Supreme Court’s web site. (The lone exception is a document that commences a new case, which will first be reviewed by the Clerk’s office and the case assigned a number before the document becomes available to the public). Accordingly, the Court has promulgated new rules and guidelines to ensure that confidential information does not accidentally become public. Specifically, new Rule 34.6 incorporates the privacy protections found in Fed. R. Civ. P. 5.2 in most cases. Moreover, documents containing material under seal must not be submitted electronically but only in paper form.  (This also holds true also for redacted forms of briefs submitted for the public record).

Given the Supreme Court’s arcane procedural rules, Proskauer’s Appellate Department recommends that any party or amicus practicing before the Court use an appellate printer to assist with filings. Printers are typically well-versed in the Court’s procedural minutiae and will be able to help you navigate the Court’s new e-filing process.

This post was written by John E Roberts of Proskauer Rose LLP., © 2017
For more legal analysis, go to The National Law Review