Massachusetts Commission Against Discrimination: Job Transfer Not Retaliation

Massachusetts Commission Against DiscriminationOn December 30, 2016, a Hearing Officer with the Massachusetts Commission Against Discrimination (MCAD) dismissed the Complainant’s retaliation case, finding that the Complainant had failed to establish a causal connection between his earlier discrimination complaint and a later adverse action. Most interesting was the Hearing Officer’s determination that the Complainant had failed to establish a prima facie case of retaliation as a result of his transfer from one facility to another.  There was no evidence that his transfer “caused Complainant to suffer any tangible economic loss or a change in any other job related benefits.” MCAD v. Mass. Dept. of Corrections, 11-BEM-02854, 2016 WL 7733656 (MCAD).

Underlying Discrimination Claim

Complainant Rigaubert Aime (“Aime”) had been a correction officer with the Massachusetts Department of Correction (“DOC”) for over twenty years. In March 2011, he filed a race discrimination claim with the MCAD and soon thereafter filed internal complaints of unfair treatment by his supervisors. While his internal complaints were all dismissed, the Hearing Officer cited established law in holding that Aime only needed to prove that he — reasonably and in good faith — believed that the DOC had discriminated against him — not that it actually had done so — in order to proceed with his retaliation complaint.

Adverse Action Demonstrated but Retaliation not Proven

 In the ensuing months, Aime claimed he was subjected to disciplinary treatment of several types, including a two-day suspension for performance reasons, which the Hearing Officer concluded were “adverse employment actions” giving rise to retaliation claims.  However, in each instance the Hearing Officer concluded that the DOC’s disciplinary actions were justified for legitimate, non-retaliatory reasons.

Job Transfer Did Not Involve A Material Change

In late July 2011, the DOC informed Aime that he was being transferred from a Pre-Release Center in Roslindale, MA to the Lemuel Shattuck Hospital Correctional Unit in Boston. The DOC Superintendent in Roslindale, the evidence showed, had requested that Aime be reassigned within a few weeks of the filing of Aime’s MCAD discrimination complaint back in March 2011 because of Aime’s repeated conflicts with his supervisors. Aime claimed that transfers in the past had often been viewed as negative or punitive and although his transfer did not involve any material change in his shift, days off, or any other terms or conditions of his employment, including his commuting time, he asserted that his transfer was in retaliation for filing his earlier MCAD complaint. The Hearing Officer did not agree, concluding that the transfer did not “materially disadvantage” him in tangible working conditions. Aime’s subjective feelings of mistreatment, without objective evidence of loss, could not sustain his claim. The Hearing Officer went on to find that, even if the transfer was to constitute an actionable adverse employment action, Aime failed to prove that the reason given for the transfer was a pretext for retaliation.

Take-aways

  1. Just because an employee has filed a claim of discrimination does not immunize the employee from disciplinary action, including discharge.

  2. Just because the employee’s discrimination complaint has been dismissed does not immunize the employer from a retaliation claim.

  3. If the employee’s discrimination claim was asserted in bad faith, it cannot support a retaliation claim. But “bad faith” is difficult to prove.

  4. The temporal proximity between the discrimination complaint and further disciplinary action is a factor in evaluating whether retaliation has occurred, but it is not dispositive.

  5. Employers should not avoid disciplining an employee who has recently filed a discrimination claim. Discipline should be issued as uniformly as possible where the circumstances support it.

  6. A persistent employee may claim retaliation, repeatedly, no matter how justified the employer’s actions may seem. This is no reason to give in.

  7. All disciplinary action should be reviewed to make sure it is well-supported. This is particularly true if a retaliation claim is likely.

  8. Job transfers to a lesser position can support a claim of retaliation. In addition, a longer commuting distance may constitute an adverse employment action.

  9. This case nonetheless illustrates that not every change relating to a job assignment is an adverse employment action. The employee has the burden of proving the adverse employment action and that it was retaliatory.

© Copyright 2017 Murtha Cullina

ACA Notice Requirements, Big Data Analytics, OSHA Retaliation Final Rule: Employment Law This Week – October 24, 2016 [VIDEO]

ACA Notice RequirementACA Section 1557 Notice Requirements Take Effect

Our top story: The Section 1557 ACA Notice Requirements have taken effect. Section 1557 prohibits providers and insurers from denying health care for discriminatory reasons, including on the basis of gender identity or pregnancy. Beginning last week, covered entities are required to notify the public of their compliance by posting nondiscrimination notices and taglines in multiple languages.

Final Rule on ACA Issued by OSHA

The Occupational Safety and Health Administration (OSHA) has issued a final rule for handling retaliation under the Affordable Care Act (ACA). The ACA prohibits employers from retaliating against employees for receiving Marketplace financial assistance when purchasing health insurance through an Exchange. The ACA also protects employees from retaliation for raising concerns regarding conduct that they believe violates the consumer protections and health insurance reforms in the ACA. OSHA’s new final rule establishes procedures and timelines for handling these complaints. The ACA’s whistleblower provision provides for a private right of action in a U.S. district court if agencies like OSHA do not issue a final decision within certain time limits.

EEOC Discusses Concerns Over Big Data Analytics

The Equal Employment Opportunity Commission (EEOC) is fact-finding on “big data.” The EEOC recently held a meeting at which it heard testimony on big data trends and technologies, the benefits and risks of big data analytics, current and potential uses of big data in employment, and how the use of big data may implicate equal employment opportunity laws. Commissioner Charlotte A. Burrows suggested that big data analytics may include errors in the data sets or flawed assumptions causing discriminatory effects. Employers should implement safeguards, such as ensuring that the variables correspond to the representative population and informing candidates when big data analytics will be used in hiring.

Seventh Circuit Vacates Panel Ruling on Sexual Orientation

The U.S. Court of Appeals for the Seventh Circuit may consider ruling that Title VII of the Civil Rights Act of 1964 (Title VII) protects sexual orientation. On its face, Title VII prohibits discrimination only on the basis of race, color, religion, sex, or national origin, and courts have been unwilling to go further. In this case, the Seventh Circuit has granted a college professor’s petition for an en banc rehearing and vacated a panel ruling that sexual orientation isn’t covered. Also, an advertising executive who is suing his former agency has asked the Second Circuit to reverse its own precedent holding that Title VII does not cover sexual orientation discrimination. We’re likely to see more precedent-shifting cases like these as courts grapple with changing attitudes towards sexual orientation discrimination.

Tip of the Week

October is Global Diversity Awareness Month, and we’re celebrating by focusing on diversity in our tips this month. Kenneth G. Standard, General Counsel Emeritus and Chair Emeritus of the Diversity & Professional Development Committee, shares some best practices for creating an inclusive environment.

©2016 Epstein Becker & Green, P.C. All rights reserved.

Expanding Retaliation: Fourth Circuit Rejects "Manager Rule" in Title VII Cases

After helping an employee report a complaint of harassment, a manager expresses concern over the company’s handling of the situation and tells the employee the complaint is being mishandled. After the complaining employee files (and then settles) a Title VII against the company, the manager is fired for failing to take a “pro-employer” stance and act in the company’s “best interests.” Does the manager have a Title VII retaliation claim? That is the exact question recently decided by the United States Court of Appeal for the Fourth Circuit in DeMasters v. Carilion Clinic.

According to the complaint, which the court accepted as true for purposes of its review, J. Neil DeMasters began working as an employee assistance program consultant for Carilion in 2006. Two years later, DeMasters was consulted by an employee who complained that his supervisor was sexually harassing him. DeMasters relayed the substance of the complaint to human resources, which investigated the allegations and fired the supervisor. The employee was told the supervisor would never be back in the workplace, but a few days later the employee’s department manager allowed the supervisor to return to collect belongings. The employee complained to DeMasters that he felt uncomfortable at work and that he was facing increasing hostility from the supervisor’s allies and friends.

Upon learning this, DeMasters contacted HR to express his concern with how the situation was being handled, and HR confirmed it was aware the employee was being harassed by co-workers. DeMasters offered to coach the HR department on better ways to handle harassment complaints. HR declined, stating it would handle the situation. However, the employee reported to DeMasters that the harassment continued to get worse on a daily basis. DeMasters then opined to the employee that the complaints were being mishandled by HR. With that, DeMasters stopped having contact with the complaining employee.

Two years later, however, the employee filed a Title VII claim, which was settled. A few weeks after the settlement, DeMasters was called into a meeting with corporate counsel, the vice president of HR, and his own department director. DeMasters was told that by not taking the “pro-employer side,” he had put the company at risk of substantial liability. Two days later, DeMasters was fired for, among other reasons explained to him in writing, failing to act in the company’s best interests and failing to protect the company.

DeMasters filed a Title VII retaliation claim, which was dismissed by the federal district court for two reasons. First, the district court found that when DeMasters’ actions were examined individually, each action failed to constitute “protected activity” under Title VII. Second, even if he had engaged in protected activity, the “manager rule” prevented him from bringing a Title VII retaliation claim because he was acting within the scope of his job duties when reporting the complaints of the employee and discussing the matter with the company.

On appeal, the Fourth Circuit roundly rejected both aspects of the district court’s reasoning. The appellate court found the district court’s individualized assessment of DeMasters’ actions to be “myopic.” The correct approach, the appellate court counseled, was to examine the totality of the circumstances in a “holistic approach.” As the court put it, just as a play cannot be understood on the basis of some of its scenes, so a discrimination claim cannot be understood without looking at the overall scenario. With this in mind, the Fourth Circuit had no difficulty finding DeMasters engaged in protected activity by complaining to the company that he felt the complaining employee was still being subjected to unlawful conduct.

The court then turned to the “manager rule,” which finds its origin in the Fair Labor Standards Act (“FLSA”) and requires an employee to “step outside” his role of representing the company in order to engage in protected activity. Under this theory, DeMasters’ job duties required him to counsel the employee and relay complaints to HR, and therefore his actions were not protected activities.

The Fourth Circuit again roundly rejected the application of the “manager rule” to the Title VII context. The court first found that whatever statutory support the “manager rule” had in the FLSA context did not exist in the Title VII context because the statutory language of Title VII differs from the FLSA in important considerations.

The court then found that two separate Title VII concepts counseled against the “manager rule.” First, under Fourth Circuit case law, an employer can escape Title VII liability if an employee’s conduct at work is sufficiently insubordinate, disruptive, or nonproductive. If the “manager rule” requires an employee to step outside his job duties in order to engage in protected activities, then it would put an employee in the dilemma of needing to step outside their job duties to have Title VII’s protections but then risk those same protections because stepping outside job duties could be seen as sufficiently insubordinate. Second, because Title VII offers employers the affirmative defense in certain harassment claims that complaining employees failed to follow the company’s internal reporting procedures, implementing a “manager rule” that could discourage employees responsible for helping other employees, such as DeMasters, from reporting concerns of discrimination. Thus, the “manager rule” would prevent Title VII’s overall goal of preventing and eliminating discrimination and harassment in the workplace.

The Fourth Circuit became just the second appellate court to look at and decide the “manager rule” question in the Title VII context in a published opinion. The Sixth Circuit similarly decided that it did not apply, but the Tenth and Eleventh Circuits have non-precedential opinions adopting the “manager rule” in the Title VII context. Continued split among the federal courts on this issue increases the likelihood the Supreme Court may one day decide the issue.

For employers, the case serves as another reminder that concerns and complaints expressed by managers in harassment claims should be taken seriously and that great care needs to be taken to ensure employees are not retaliated against. Courts and the EEOC have been taking an increasingly expanded view of what constitutes protected activity and retaliation, and employers not mindful of these developments ignore them at their peril.

Gonzalez Saggio & Harlan LLP | Copyright (c) 2015

Expanding Retaliation: Fourth Circuit Rejects “Manager Rule” in Title VII Cases

After helping an employee report a complaint of harassment, a manager expresses concern over the company’s handling of the situation and tells the employee the complaint is being mishandled. After the complaining employee files (and then settles) a Title VII against the company, the manager is fired for failing to take a “pro-employer” stance and act in the company’s “best interests.” Does the manager have a Title VII retaliation claim? That is the exact question recently decided by the United States Court of Appeal for the Fourth Circuit in DeMasters v. Carilion Clinic.

According to the complaint, which the court accepted as true for purposes of its review, J. Neil DeMasters began working as an employee assistance program consultant for Carilion in 2006. Two years later, DeMasters was consulted by an employee who complained that his supervisor was sexually harassing him. DeMasters relayed the substance of the complaint to human resources, which investigated the allegations and fired the supervisor. The employee was told the supervisor would never be back in the workplace, but a few days later the employee’s department manager allowed the supervisor to return to collect belongings. The employee complained to DeMasters that he felt uncomfortable at work and that he was facing increasing hostility from the supervisor’s allies and friends.

Upon learning this, DeMasters contacted HR to express his concern with how the situation was being handled, and HR confirmed it was aware the employee was being harassed by co-workers. DeMasters offered to coach the HR department on better ways to handle harassment complaints. HR declined, stating it would handle the situation. However, the employee reported to DeMasters that the harassment continued to get worse on a daily basis. DeMasters then opined to the employee that the complaints were being mishandled by HR. With that, DeMasters stopped having contact with the complaining employee.

Two years later, however, the employee filed a Title VII claim, which was settled. A few weeks after the settlement, DeMasters was called into a meeting with corporate counsel, the vice president of HR, and his own department director. DeMasters was told that by not taking the “pro-employer side,” he had put the company at risk of substantial liability. Two days later, DeMasters was fired for, among other reasons explained to him in writing, failing to act in the company’s best interests and failing to protect the company.

DeMasters filed a Title VII retaliation claim, which was dismissed by the federal district court for two reasons. First, the district court found that when DeMasters’ actions were examined individually, each action failed to constitute “protected activity” under Title VII. Second, even if he had engaged in protected activity, the “manager rule” prevented him from bringing a Title VII retaliation claim because he was acting within the scope of his job duties when reporting the complaints of the employee and discussing the matter with the company.

On appeal, the Fourth Circuit roundly rejected both aspects of the district court’s reasoning. The appellate court found the district court’s individualized assessment of DeMasters’ actions to be “myopic.” The correct approach, the appellate court counseled, was to examine the totality of the circumstances in a “holistic approach.” As the court put it, just as a play cannot be understood on the basis of some of its scenes, so a discrimination claim cannot be understood without looking at the overall scenario. With this in mind, the Fourth Circuit had no difficulty finding DeMasters engaged in protected activity by complaining to the company that he felt the complaining employee was still being subjected to unlawful conduct.

The court then turned to the “manager rule,” which finds its origin in the Fair Labor Standards Act (“FLSA”) and requires an employee to “step outside” his role of representing the company in order to engage in protected activity. Under this theory, DeMasters’ job duties required him to counsel the employee and relay complaints to HR, and therefore his actions were not protected activities.

The Fourth Circuit again roundly rejected the application of the “manager rule” to the Title VII context. The court first found that whatever statutory support the “manager rule” had in the FLSA context did not exist in the Title VII context because the statutory language of Title VII differs from the FLSA in important considerations.

The court then found that two separate Title VII concepts counseled against the “manager rule.” First, under Fourth Circuit case law, an employer can escape Title VII liability if an employee’s conduct at work is sufficiently insubordinate, disruptive, or nonproductive. If the “manager rule” requires an employee to step outside his job duties in order to engage in protected activities, then it would put an employee in the dilemma of needing to step outside their job duties to have Title VII’s protections but then risk those same protections because stepping outside job duties could be seen as sufficiently insubordinate. Second, because Title VII offers employers the affirmative defense in certain harassment claims that complaining employees failed to follow the company’s internal reporting procedures, implementing a “manager rule” that could discourage employees responsible for helping other employees, such as DeMasters, from reporting concerns of discrimination. Thus, the “manager rule” would prevent Title VII’s overall goal of preventing and eliminating discrimination and harassment in the workplace.

The Fourth Circuit became just the second appellate court to look at and decide the “manager rule” question in the Title VII context in a published opinion. The Sixth Circuit similarly decided that it did not apply, but the Tenth and Eleventh Circuits have non-precedential opinions adopting the “manager rule” in the Title VII context. Continued split among the federal courts on this issue increases the likelihood the Supreme Court may one day decide the issue.

For employers, the case serves as another reminder that concerns and complaints expressed by managers in harassment claims should be taken seriously and that great care needs to be taken to ensure employees are not retaliated against. Courts and the EEOC have been taking an increasingly expanded view of what constitutes protected activity and retaliation, and employers not mindful of these developments ignore them at their peril.

Gonzalez Saggio & Harlan LLP | Copyright (c) 2015

Jury Awards $1.6M to Sarbanes-Oxley Whistleblower

A New York federal jury awarded $1.6M in compensatory damages to a whistleblower in a Sarbanes-Oxley whistleblower retaliation lawsuit. The verdict is consistent with a recent trend of large jury verdicts in whistleblower retaliation claims, including a six million dollar verdict in the Zulfer SOX case. According to the verdict form, the full amount of the verdict awarded to whistleblower Julio Perez was for compensatory damages. Under the whistleblower provision of SOX, there is no cap on compensatory damages.

While employed at Progenics Pharmaceuticals as a Senior Manager of Pharmaceutical Chemistry, Perez worked with representatives of Progenics and Wyeth to develop Relistor, a drug that treats post-operative bowel dysfunction and opioid-induced constipation. In May 2008, Progenics and Wyeth issued a press release stating that the second phase of trials “showed positive activity” and that the two companies were “pleased by the preliminary findings of this oral formulation” of Relistor. Within two months of the issuance of the press release, Wyeth executives sent a memo to Progenics senior executives informing them that the second phase of clinical trials failed to show sufficient clinical activity to warrant a third phase of trials. The Wyeth memo specifically stated: “Do not pursue immediate initiation of Phase 3 studies with either available oral tablets or capsule formulations.”

Perez saw the confidential Wyeth memo and on August 4, 2008, he sent a memo to Progenics’ Senior Vice-President and General Counsel in which he alleged that Progenics was “committing fraud against shareholders since representations made to the public were not consistent with the actual results of the relevant clinical trial, and [Plaintiff] think[s] this is illegal.” The next day, Progenics’ General Counsel questioned Perez about the confidential Wyeth memo. Progenics then terminated Perez’s employment, claiming he had refused to reveal how he had obtained the Wyeth memorandum.

Perez brought suit under SOX, alleging that Progenics terminated his employment because of his August 4, 2008 Memorandum, and denying that he refused to answer questions about his access to the Wyeth memo. Progenics again claimed that it terminated Perez’s employment because he failed to explain how he got the memo. The memo’s intended recipients denied giving Perez a copy of the memo. During the litigation, Perez argued that the memo was distributed widely within Wyeth and that he had not “misappropriated” it.

Following an investigation, OSHA did not substantiate Perez’s SOX complaint. Perez removed his SOX complaint to federal court in November 2010. On July 25, 2013, Judge Kenneth Karas issued an order denying Progenics’ motion for summary judgment. The case was hard-fought, with more than 120 docket entries concerning pre-trial matters. Perez was represented by counsel when he filed his SOX claim in federal court, but proceeded pro seshortly before Progenics moved for summary judgment through trial.

Recent Sarbanes-Oxley Whistleblower Jury Verdicts

On March 5, 2014, a California jury awarded $6 million to Catherine Zulfer in her SOX whistleblower retaliation against Playboy, Inc. (“Playboy”).  Zulfer, a former accounting executive, alleged that Playboy had terminated her in retaliation for raising concerns about executive bonuses to Playboy’s Chief Financial Officer and Chief Compliance Officer.  Zulfer v. Playboy Enterprises Inc., JVR No. 1405010041, 2014 WL 1891246 (C.D.Cal. 2014).  She contended that she had been instructed by Playboy’s CFO to set aside $1 million for executive bonuses that had not been approved by the Board of Directors.  Id.  Zulfer refused to carry out this instruction, warning Playboy’s General Counsel that the bonuses were contrary to Playboy’s internal controls over financial reporting.  Id.  After Zulfer’s disclosure, the CFO retaliated by ostracizing Zulfer, excluding her from meetings, forcing her to take on additional duties, and eventually terminating her employment.  Id.  After a short trial, a jury awarded Zulfer $6 million in compensatory damages and also ruled that Zulfer was entitled to punitive damages.  Id.  Zulfer and Playboy reached a settlement before a determination of punitive damages.  The $6 million compensatory damages award is the highest award to date in a SOX anti-retaliation case.  Id.

The Ninth Circuit recently affirmed a SOX jury verdict awarding $2.2 million in damages, plus $2.4 million in attorneys’ fees, to two former in-house counsel.  Van Asdale v. Int’l Game Tech., 549 F. App’x 611, 614 (9th Cir. 2013).  The plaintiffs, both former in-house counsel at International Game Technology, alleged that they had been terminated in retaliation for disclosing shareholder fraud related to International’s merger with rival game company Anchor Gaming.  Id.  Specifically, plaintiffs alleged that Anchor had withheld important information about its value, causing International to commit shareholder fraud by paying above market value to acquire Anchor.  Van Asdale v. Int’l Game Tech., 577 F.3d 989, 992 (9th Cir. 2009).  When the plaintiffs discovered the issue, they brought their concerns about the potential fraud to their boss, who had served as Anchor’s general counsel prior to the merger. Id. at 993.  International terminated both plaintiffs shortly thereafter. Id. 

In addition, a former financial planner at Bancorp Investments, Inc. who alleged that he was terminated for disclosing trade unsuitability obtained a $250,000 jury verdict in the Eastern District of Kentucky in late 2013.   Rhinehimer v. Bancorp Investment, Inc., 2013 WL 9235343 (E.D.Ky. Dec. 27, 2013), aff’d 2015 WL 3404658 (6th Cir. 2014).

Zulfer, Van Asdale, and Rhinehimer highlight the importance of the removal or “kick out” provision in SOX that authorizes SOX whistleblowers to remove their claims from the Department of Labor to federal court for de novo review 180 days after filing the complaint with OSHA.

© 2014 Zuckerman Law

Oklahoma Federal Court Denies Summary Judgment to Employer on Professor’s Allegations He Was Denied Tenure After Reporting Inappropriate Facebook Posts by Fellow Professors

Allen Matkins Leck Gamble Mallory & Natsis LLP

A federal court in Oklahoma recently denied summary judgment to Northeastern State University, finding that a professor’s discrimination and retaliation claims, among others, could proceed to trial. The professor, Dr. Leslie Hannah, was appointed chair of his department in 2009. The previous assistant chair, Dr. Brian Cowlishaw, was ineligible for the chair position pursuant to the University’s nepotism policy (his wife, Dr. Bridget Cowlishaw, was a professor in the department). During that period, Dr. Brian Cowlishaw posted the following comment on his Facebook page:

“Brian Hammer Cowlishaw /salutes in NSU’s direction / Good luck with that, then! [translation: I won’t be entering the ‘election’ for department chair, because what I offer, no one wants] Good luck! / salute!”

Then in response to a comment, he wrote:

“There will be an ‘election’ the first week of February. They’re making a f*****g indian chair.”

In 2010, Drs. Brian and Bridget Cowlishaw, and another professor, Dr. Donna Shelton, made disparaging comments on Facebook after Dr. Hannah scheduled a department meeting to be held outdoors by the river. In response to a post by Dr. Bridget Cowlishaw about not looking forward to the beginning of the academic year, Dr. Shelton wrote:

“Wonder if they sell body armor for use under regalia…”

In response to a post by Dr. Brian Cowlishaw about the camping trip, Dr. Bridget Cowlishaw wrote:

“Nah, our chair will bring all the handbaskets we need. He’s probably woven them himself.”

In response to a post about whether anyone attended, Dr. Bridget Cowlishaw wrote:

“Maybe they were all eaten by wolves.”

Dr. Hannah reported the posts to the University. The University found that the posts were inappropriate, and reprimanded the professors. Dr. Bridget Cowlishaw entered into a settlement agreement with the University whereby she resigned.

In 2011, Dr. Hannah reported to Human Resources: “I think the time has come for me to leave NSU. This seems to be an unsafe place for American Indians. I will be submitting my resignation . . . ” He then did not resign his position, but he did resign as department chair.

Dr. Hannah ultimately submitted his application for tenure and early promotion when he became eligible in late 2012. The committee that reviewed his application consisted of seven people, including Dr. Brian Cowlishaw and Dr. Shelton. The vote regarding Dr. Hannah was split 3/3 with one abstention, with Dr. Brian Cowlishaw and Dr. Shelton voting to deny the application. Thereafter, in early 2013, the University’s Dean reviewed the committee’s findings and denied Dr. Hannah’s application, stating that Dr. Hannah had “polarized the Department and displayed hostility toward other faculty and staff.” The Dean later stated that, while he was aware of past conflicts in the department, he was unaware of the inappropriate Facebook posts. Dr. Hannah filed a complaint with the University, and the University placed Dr. Hannah on administrative leave with pay for the remainder of his contract.

Dr. Hannah filed suit, including for discrimination and retaliation. The University brought a summary judgment motion. With respect to the discrimination and retaliation claims, the University’s main argument was that there was no causal connection between the Facebook posts in 2009 and 2010 and the denial of Dr. Hannah’s tenure in 2013.

The court was unconvinced that the passage of time between the Facebook posts and the denial of tenure defeated causation, stating: “Two years is not a significant amount of time. It is more than plausible and rather likely that after two years, Dr. Cowlishaw and Dr. Shelton still held some animosity toward Dr. Hannah for his reporting their Facebook posts, which resulted in their reprimands and possibly in the resignation of Dr. Cowlishaw’s wife.”

The Hannah case is another reminder for employers regarding the importance of implementing a good social media policy and training all employees to abide by it. Training employees not to make inappropriate posts in the first place trumps effective corrective action once the employer becomes aware of such posts. Although inHannah, the University’s initial response to the inappropriate posts was sufficient, the fact that the professors had made the posts in the first place played a key role in precluding the University from prevailing on summary judgment during later litigation.

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United States Supreme Court Round-Up: Key Opinions from 2013 to 2014 and Upcoming High-Profile Business Disputes

Andrews Kurth

The 2013–2014 term of the United States Supreme Court resulted in a wide range of decisions of importance to business. In this article, we highlight some of the key opinions and explore their likely impacts. We also preview a few of the high-profile business disputes the Supreme Court has agreed to hear next term.

Key Business Cases from the 2013–2014 Term

American Chemistry Council v. Environmental Protection Agency: Holding: The Environmental Protection Agency (EPA) reasonably interpreted the Clean Air Act to require sources that would need permits based on their emission of chemical pollutants to comply with “best available control technology” for greenhouse gases. Effect: The decision reinforces the Supreme Court’s previous recognition that the EPA has the power to regulate greenhouse gases as pollutants. However, portions of the decision strongly cautioned the EPA against overreach, stating that the agency may not “bring about an enormous and transformative expansion in [its] regulatory authority without clear congressional authorization.” These comments suggest that the Supreme Court may take a hard line when the Obama Administration’s other climate regulations eventually go to court.

Daimler AG v. Bauman: Holding: A foreign company doing business in a state cannot be sued in that state for injuries allegedly caused by conduct that took place entirely outside of the United States. Effect: Daimler makes it much harder for plaintiffs to establish general jurisdiction over foreign entities. The opinion re-characterizes general jurisdiction as requiring the defendant to be “at home” in the state, a circumstance that the Supreme Court suggested will generally be limited to the places where the defendant is incorporated or where it has its principal place of business. Moreover, the fact that a domestic subsidiary whose activities are imputed to the foreign parent may be “at home” in the state will not make the foreign parent “at home” in that locale for purposes of general jurisdiction.

Halliburton v. Erica P. John Fund, Inc.: Holding: Plaintiffs in private securities fraud actions must prove that they relied on the defendants’ misrepresentations in choosing to buy stock. Basic v. Levinson’s holding that plaintiffs can satisfy this reliance requirement by invoking a presumption that the price of stock as traded in an efficient market reflects all public, material information, including material misstatements, remains viable. However, after Halliburton, defendants can defeat the presumption at the class certification stage by proving that the misrepresentation did not in fact affect the stock price. Effect: While investors will continue to pursue class actions following large dips in stock prices, the Halliburton decision helps to level the playing field by providing defendants a mechanism to stop such suits at the class certification stage.

Lawson v. FMR LLC: Holding: Employees of privately held contractors or subcontractors of a public company are protected by the anti-retaliation provision of the Sarbanes-Oxley Act of 2002 (SOX). Effect: Following Lawson, there will likely be an increase in SOX litigation against public and non-public companies. Because many of the issues concerning the scope and meaning of SOX have yet to be resolved, lower courts will continue to wrestle with defining the parameters of the law. Questions left unanswered byLawson include whether the whistleblower’s accusation must be related to work he or she performed for the company and whether the contract with the public company must have some relation to public accounting or securities compliance.

Chadbourne & Park LLP v. Troice: Holding: The Securities Litigation Uniform Standards Act of 1988 (SLUSA) does not preclude state-law class actions based on false representations that the uncovered securities that plaintiffs were purchasing were backed by covered securities. Effect: SLUSA bars the bringing of securities class actions “based upon statutory or common law of any state” in which the plaintiff alleges “a misrepresentation or omission of a material fact in connection with a purchase of sale of covered securities.” The statute defines “covered securities” to include only securities traded on a national securities exchange or those issued by investment companies.

U.S. v. Quality Stores: Holding: Severance payments to employees who are involuntarily terminated are taxable wages for purposes of the Federal Insurance Contributions Act. Effect: Employers should, under most circumstances, treat severance payments to involuntarily terminated employees as wages subject to FICA taxes. There are exceptions, however, and employers should therefore seek legal counsel to assist in determining the tax status of a particular severance arrangement.

Business Cases to Watch in the 2014–2015 Term

Integrity Staffing Solutions v. Busk: Whether time spent in security screenings is compensable under the Fair Labor Standards Act.

Mach Mining v. Equal Employment Opportunity Commission: Whether and to what extent a court may enforce the Equal Employment Opportunity Commission’s mandatory duty to conciliate discrimination claims before filing suit.

Omnicare v. Laborers District Council Construction Industry Pension Fund: Whether, for purposes of a claim under Section 11 of the Securities Act of 1933, a plaintiff may plead that a statement of opinion was untrue merely by alleging that the opinion itself was objectively wrong, or must the plaintiff also allege that the statement was subjectively false through allegations that the speaker’s actual opinion was different from the one expressed.

Young v. UPS: Whether, and in what circumstances, an employer that provides work accommodations to non-pregnant employees with work limitations must provide work accommodations to pregnant employees who are similar in their ability or inability to work.

As in recent years, the Supreme Court continues to grant review on more and more cases involving matters of concern to U.S. businesses. Andrews Kurth attorneys are available to provide further detail and guidance on the decisions highlighted here, and on any other issues of concern to your company that have reached the high court.

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