Administrative Review Board Decisions
The following case summaries were created by the Administrative Review Board staff.
Thorstenson v. BNSF Railway Co., ARB Nos. 2018-0059, -0060, ALJ No. 2015-FRS-00052 (ARB May 15, 2023) (Order of Remand)
REMAND FOR DAMAGES; AGGRAVATION OF EXISTING INJURY DID NOT CONSTITUTE NEW INJURY REQUIRING COMPLIANCE WITH REPORTING RULE
In Thorstenson v. BNSF Railway Co., ARB Nos. 2018-0059, -0060, ALJ No. 2015-FRS-00052 (ARB May 15, 2023), the ARB remanded an FRSA case to the ALJ for "the limited purpose of determining compensatory damages based on the existing record, to be supplemented only as to post-hearing damages."
Complainant was working for Respondent as a conductor on February 2, 2009 when he slipped on steps and injured his left knee. He reported the injury the following day in accordance with Respondent's 72-hour injury reporting rule. On November 17, 2010, Complainant "banged his left kneecap against something metal." After experiencing swelling and seeing a doctor, he reported the incident five days later, and Respondent determined that Complainant had experienced a new injury that should have been reported within 72 hours. Respondent imposed discipline that included a "Level S violation," which would remain on his record and could result in his discharge if he committed further infractions.
On June 26, 2011, Complainant was involved in a speeding incident which resulted in the imposition of a second Level S violation. Respondent discharged Complainant, noting that both of his Level S violations were considered in the termination of his employment. Complainant filed a retaliation complaint under the FRSA.
On July 31, 2018, the ALJ issued a decision in which he concluded that (1) Complainant engaged in FRSA-protected activity by reporting an injury; (2) the activity was a contributing factor in the discipline he received; but (3) Respondent established by clear and convincing evidence that it would have discharged Complainant even if he had not engaged in protected activity. The ALJ denied the complaint, and the parties appealed the ALJ's decision to the ARB.
On November 25, 2019, the Board affirmed the ALJ's denial of the complaint. It held that the ALJ erred by concluding that Complainant met his burden to prove contributing factor causation by a preponderance of the evidence, and affirmed the ALJ's finding that Respondent would have imposed the same adverse actions in the absence of Complainant's protected activity. Complainant appealed the ARB ruling to the U.S. Court of Appeals for the Ninth Circuit.
On December 21, 2020, the Ninth Ciruit issued an unpublished Memorandum in which it reversed and remanded the ARB ruling. The Ninth Circuit held that Complainant had not experienced a new injury but instead suffered an "aggravation to an existing injury which Thorstenson had already reported." This made it "virtually impossible for Thorstenson to know he had experienced a new injury in time to comply with BNSF's 72-hour reporting rule." The Ninth Circuit remanded the case to the ARB "for further proceedings consistent with [its] disposition." The ARB addressed the errors identified by the Ninth Circuit but affirmed its November 25, 2019 ruling that Complainant failed to meet his burden to prove retaliation.
On March 15, 2023, the Ninth Circuit issued a second Memorandum in which it held that the ARB erred in its interpretation of their prior decision. The Ninth Circuit concluded that substantial evidence did not support the ALJ's conclusion that Respondent proved by clear and convincing evidence that it would have discharged Complainant in the absence of his protected activity. It reiterated its conclusion that, "because it was virtually impossible for Thorstenson to comply with the injury reporting rule, he was effectively disciplined for the protected activity of reporting a workplace injury." The Ninth Circuit reversed the decision of the ARB and "remand[ed] with instructions to remand to the ALJ for the limited purpose of determining compensatory damages based on the existing record, to be supplemented only as to post-hearing damages." In accordance with the Ninth Circuit's instructions, the ARB remanded the case to the ALJ.
Gladden v. The Proctor and Gamble Co., ARB No. 2022-0012, ALJ No. 2021-SOX-00012 (ARB May 9, 2023) (Decision and Order)
RES JUDICATA; ACQUIESCENCE TO CLAIM SPLITTING; MANIFEST INJUSTICE; RECONSIDERATION; DISSENT
In Gladden v. The Proctor and Gamble Co., ARB No. 2022-0012, ALJ No. 2021-SOX-00012 (ARB May 9, 2023), the ARB affirmed the ALJ's Order Granting Respondent's Motion to Dismiss (D. & O.) because res judicata barred Complainant's SOX claim against Respondent. The ARB also affirmed the ALJ's Order Denying Complainant's Motion for Reconsideration. One Member dissented from the majority's affirmance because the dissenting Member believed that res judicata was not available to extinguish Complainant's SOX claim.
In the case, Complainant filed two actions involving Respondent terminating her employment: (1) Complainant filed a wrongful discharge claim under Title VII in the U.S. District Court for the Northern District of Georgia (the case was originally a gender discrimination and retaliation case filed with the EEOC); and (2) Complainant filed a SOX Complaint with OSHA, alleging that Respondent had violated SOX by discharging her in retaliation for her protected activity.
On September 8, 2021, the District Court Judge in the Title VII action granted Respondent's Motion for Summary Judgment and issued a final order dismissing the Title VII action. Subsequently, on October 22, 2021, the ALJ in the SOX case granted Respondent's Motion to Dismiss because the ALJ found that the four elements of res judicata were met and res judicata barred Complainant's SOX action. Complainant appealed.
RES JUDICATA; RES JUDICATA APPLIES TO SOX CLAIM; SOX CLAIM COULD HAVE BEEN BROUGHT IN THE PRIOR LITIGATION
A party seeking to apply the doctrine of res judicata must establish that (1) a court of competent jurisdiction entered a final decision on the merits in a previous action, (2) the current action involves the same parties or their privies in the previous action, (3) the current action raises claims that were litigated or could have been raised in the previous action, and (4) the cases involve the same cause of action or common nucleus of operative fact. The ARB held that all four elements of res judicata were met.
First Element – Final Decision on the Merits
The first element concerns only whether a court with proper jurisdiction rendered a final decision in a previous action. In the Title VII action, the District Court (a court of competent jurisdiction) ordered summary judgment (a final decision) on Complainant's Title VII claim. Therefore, the ARB held that the first element was met.
Second Element – Same Parties in the Previous Action
The second element requires that both cases involve the same parties or their privies. There was no dispute that Complainant and Respondent were the parties in Title VII action before the district court and in the SOX action before the ALJ. Therefore, the Board found that the second element of res judicata was also met.
Third Element – Claims Previously Litigated or Could Have Been Litigated
The third required element of res judicata considers whether the second action involves claims that were litigated or could have been litigated in the previous action.
Complainant asserted that the procedural timing of her two claims prevented the establishment of the third element of res judicata. The ARB found that the facts revealed otherwise. Complainant filed her Title VII claim on June 26, 2019. She had the option to move her SOX claim from OSHA to federal District Court in early September 2019 under SOX's kick out procedure (because the Secretary of Labor had not issued a decision on her claim within 180 days), but Complainant did not move her SOX claim to federal court but instead left it within OSHA's jurisdiction. Respondent did not move for summary judgment on the Title VII claim until January 11, 2021. Therefore, though Complainant was not initially able to bring both claims together because of statutory mandates, Complainant had at least a year to join the SOX claim with the Title VII claim in federal court.
Complainant and the dissenting Member asserted that applying res judicata converts Complainant's option to move her SOX claim to federal court into an obligation, which conflicts with the SOX's statutory scheme. While the ARB appreciated the significance of the SOX statutory scheme, providing complainants with the option to keep their claims within the Department, the language and policy of SOX do not undercut the application of well-settled res judicata principles. Complainant did not lose her statutory choice of forum, and was not "obligated" to remove her SOX claim to federal court; rather, she assumed the risk that having made her choice not to join the claims, her SOX claim might be subject to a res judicata defense.
Fourth Element – Same Cause of action
The final element of res judicata requires that both actions involve the same cause of action. Courts make a fact-based inquiry to determine whether multiple actions arise out of the same cause of action. Complainant's Title VII claim in District Court alleged that Respondent had unlawfully discriminated against her based on her gender and retaliated against her when it terminated her employment. Complainant's SOX claim before the ALJ alleged that Respondent had violated SOX by discharging her in retaliation for engaging in protected activity. Accordingly, both claims concerned whether her termination was unlawful and, thus, arose out of the same cause of action.
ACQUIESCENCE; RESPONDENT DID NOT ACQUIESCE TO CLAIM SPLITTING
When a defendant acquiesces to claim splitting, the defendant waives a res judicata defense. Consent to claim splitting may be "in express words or otherwise." Courts have "recogniz[ed] an exemption to res judicata when the parties have agreed in terms or in effect that the plaintiff may split his [or her] claim." Here, the ARB found that Respondent timely objected to claim splitting and, although it was a close call, the ARB found that Respondent did not expressly consent or consent "in effect" to claim splitting. Therefore, the ARB found that Respondent did not acquiesce to claim splitting.
Respondent Timely Objected to Claim Splitting
The ARB found that Respondent objected to claim splitting on two occasions.
First, Respondent objected to claim splitting on April 23, 2021, when it submitted initial disclosures to Complainant in the SOX matter before the ALJ. Respondent stated stated: "P&G . . . objects to this appeal because Gladden is pursuing piecemeal litigation about the subject of her termination in two separate forums."
Second, on May 4, 2021, Respondent objected to claim splitting when it filed a memorandum in support of its Motion for Dispositive Action in the SOX action. Respondent noted in the memorandum that: "P&G . . . objects to issues of Gladden's discharge being heard piecemeal in different venues."
Both of Respondent's objections were unequivocal and occurred prior to September 8, 2021—the date the District Court entered final judgment on Complainant's Title VII claim. Therefore, the ARB found that Respondent adequately raised the potential res judicata implications for Complainant's consideration and thereby presented Complainant with an opportunity to consolidate her claims.
Respondent Did Not Consent to Claim Splitting
The ARB considered whether Respondent's comments in its Title VII Opposition Memorandum constituted consent to claim splitting. Respondent stated in its Title VII Opposition Memorandum: "Gladden has a pending OSHA [c]harge she brought pursuant to the Sarbanes-Oxley Act ('SOX'), in which she brought similar, meritless claims regarding purported retaliation for compliance concerns. The elements of a SOX retaliation claim stand independent of and are unrelated to Title VII claims." Respondent also claimed that "[t]hese are different statutes concerning different fact situations," and that the court "should ignore any effort by Gladden to conflate the two."
The ARB did not interpret Respondent's statements in the Title VII Opposition Memorandum to imply that Respondent consented "in effect" to claim splitting. Instead, the ARB examined Respondent's statements in context, and the ARB found that Respondent emphasized the differences between the SOX and Title VII actions to demonstrate Complainant's inconsistent rationales for Complainant's termination, not to consent to claim splitting "in effect." In support, the ARB highlighted how Respondent stated in the Title VII Opposition Memorandum that Complainant's SOX "claim is at odds with [Gladden's] allegations in this case in that it involves a wholly different alleged motivation for her discharge." The ARB also highlighted how Respondent further emphasized Gladden's inconsistent rationales for termination, stating: "It would seem even Gladden is not certain what it is she believes was the basis for P&G's decision to terminate her employment." Therefore, when Respondent highlighted differences between the SOX and Title VII suit, Respondent was not effectively consenting to claim splitting. Instead, Respondent was attempting to illustrate how Complainant had advanced inconsistent theories for her termination in order to undermine Complainant's argument and credibility.
Moreover, even if one could argue that Respondent consented "in effect" to claim splitting in its Opposition Memorandum, Respondent subsequently raised timely objections, which notified Complainant of the need to consolidate her claims. Therefore, the ARB concluded that Respondent did not acquiesce to claim splitting.
MANIFEST INJUSTICE; MANIFEST INJUSTICE DOES NOT APPLY
Complainant argued that, even if the elements of res judicata are met, the doctrine should not apply because doing so would result in manifest injustice in this case. Complainant noted that she did not join the SOX claim in the district court action because she was required to initially bring the claim separately and that neither the statutory language of SOX nor OSHA's kick-out letter provided that she had to move the claim to federal court.
Courts have on rare occasions rejected strict application of res judicata when its use would result in manifest injustice. This exception should be applied only in narrow circumstances, such as when personal liberty is at stake or in cases involving civil commitment of the mentally ill or custody of a child. The United States Supreme Court has also "cautioned against departing from accepted principles of res judicata," stating that there is "no principle of law or equity which sanctions the rejection of" res judicata. Here, because Complainant had ample opportunity to merge her SOX claim with the Title VII action but failed to attempt to join the two, the ARB found that the ALJ did not err in declining to apply the manifest injustice exception to res judicata.
RECONSIDERATION; DENIAL OF RECONSIDERATION
Complainant also contested the ALJ's decision to deny her motion for reconsideration. Granting a motion for reconsideration is appropriate when the tribunal clearly made a mistake of fact or law or when the factual situation has changed materially since the previous decision. Rulings on motions for reconsideration are reviewed under an abuse of discretion standard. Complainant did not allege any major factual changes between the dismissal and the motion for reconsideration, and the ALJ did not make an error of law or fact when dismissing the case. Therefore, the Board found that the ALJ did not abuse her discretion in denying reconsideration.
DISSENT; DISSENT FROM APPLICATION OF RES JUDICATA; SOX CLAIM COULD NOT HAVE BEEN BROUGHT IN THE PRIOR LITIGATION
One Member dissented from the majority's affirmance of the ALJ's application of res judicata. The dissenting Member would reverse the ALJ's decision because the doctrine of res judicata was not available to extinguish Complainant's SOX claim.
The dissenting Member concurred with the majority opinion that the Title VII litigation was a final decision on the merits by a court of competent jurisdiction involving the same parties or privities and same cause of action.
The dissenting Member departed from the majority opinion over whether the claim could have been brought in the prior litigation and the timing of that analysis. The dissenting Member concurred with the majority opinion that Complainant could have filed her SOX claim with the District Court during the pendency of the Title VII litigation under SOX's kick-out procedure. The SOX claim reached the 180-day mark on September 18, 2019. The federal claim was not dismissed until September 8, 2021. But the dissenting Member disagreed with the ALJ and the lead opinion that Complainant was compelled to do so under res judicata principles. This is so because this right matured after she filed her respective Title VII and SOX claims.
Courts do not generally apply res judicata to extinguish a second claim if it could not have been brought in the first claim at the time the first claim was filed or merged with the first claim during the pendency of the first claim but before the second claim was filed. From the perspective of both the District Court and the ALJ, Complainant had to file both claims in separate tribunals. They were not part of the same convenient trial unit. Complainant could not have included her Title VII claims with her administrative SOX claim as DOL's jurisdiction is limited to the statutes assigned to it. At the time that Complainant filed her Title VII claim, she also could not have included her SOX claim because she was required to exhaust administrative remedies.
In addition, the application of res judicata at the time the ALJ applied it conflicts with the statutory scheme placing the administrative claim with the DOL and giving the complainant the election to file in federal court. It transforms the election to file in District Court into a mandate or face res judicata dismissal. Further, there is considerable uncertainty as to how such an application would work under the various permutations that might arise after the 180-day mark in situations where complainant has federal litigation but complainant's preference is to keep her OSHA claim in the administrative forum.
Braun v. United Airlines, Inc., ARB No. 2023-0014, ALJ No. 2021-AIR-00014 (ARB May 3, 2023) (Order of Remand)
SEALING RECORD; CASE REMANDED TO ALJ TO ISSUE ORDER WITH SPECIFIC FACTUAL FINDINGS ADDRESSING WHETHER THERE ARE SUFFICIENTLY COMPELLING REASONS TO MAINTAIN SEAL OVER MATERIALS IN THE RECORD
In Braun v. United Airlines, Inc., ARB No. 2023-0014, ALJ No. 2021-AIR-00014 (ARB May 3, 2023), the parties had filed briefs and other materials under seal with the ALJ, and requested permission to do the same on appeal with the ARB. In support of their request, the parties represented that the materials they desired to have sealed concerned information designated by Respondent as "confidential" pursuant to the terms of a Protective Order agreed to by the parties and entered by the ALJ.
The ARB observed that the ALJ's Protective Order stated that to the extent any information "filed or to be filed with the Tribunal reveal or tend to reveal information claimed to be confidential, these papers or any portions thereof must be filed under seal by the filing party utilizing the procedures set forth in" 29 C.F.R. § 18.85. Section 18.85, in turn, provides that "[o]n motion of any interested person or the judge's own, the judge may order any material that is in the record to be sealed from public access." Such an order "must state findings and explain why the reasons to seal adjudicatory records outweigh the presumption of public access."
Thus, the ARB determined that the Protective Order "was not a standing order giving the parties carte blanche to file briefs and other materials under seal after self-designating information as confidential. Instead, the Protective Order and the OALJ Rules of Practice and Procedure cited therein required the parties to utilize the procedures set forth in 29 C.F.R. § 18.85 if they desired to have materials filed under seal, including obtaining an order 'stat[ing] findings and explain[ing] why the reasons to seal adjudicatory records outweigh the presumption of public access.'" The Board also reiterated its instructions in Furlong-Newberry v. Exotic Metals Forming Corp., ARB No. 2022-0017, ALJ No. 2019-TSC-00001 (ARB Nov. 9, 2022), in which it stated that "[a] party seeking to seal judicial records must specify facts that causally connect the documents at hand to sufficiently compelling reasons that justify overriding the strong presumption favoring public access. . . The fact that a protective order has been issued does not present sufficient compelling reasons to seal the record."
Ultimately, the ARB determined that it did not appear from the record that the parties or the ALJ followed the appropriate procedures to seal record materials. Additionally, the ARB concluded that it could not determine from the record whether there were, in fact, "sufficiently compelling reasons" to justify maintaining the seal over materials filed confidentially with the ALJ below, or to justify accepting materials under seal on appeal. Accordingly, the ARB remanded the case to the ALJ "to issue an order with specific factual findings addressing whether there are sufficiently compelling reasons to maintain a seal over materials in the record before the ALJ after conscientiously balancing the competing interests of the public in having access to judicial records, consistent with 29 C.F.R. § 18.85 and the Board's decision in Furlong-Newberry."