[Last Updated June 29, 2015]
TIMELINESS OF ACA WHISTLEBLOWER COMPLAINT; COMPLAINANT'S RELATION BACK CONTENTION FOUND TO BE UNAVAILING WHERE ORIGINAL COMPLAINT COULD NOT REASONABLY BE CONSTRUED TO INCLUDE ACA RETALIATION ALLEGATIONS
In Stroud v. Mohegan Tribal Gaming Authority , ARB Nos. 13-079, 14-013, ALJ Nos. 2013-ACA-3, 2013-CFP-3 (ARB Nov. 26, 2014), the Complainant filed a Sarbanes-Oxley Act and a Consumer Financial Protection Act claim against the Mohegan Tribal Gaming Authority, which was owed by the Mohegan Tribe, a tribal sovereign nation. After an ALJ dismissed these complaints based on tribal sovereign immunity, the Complainant filed a retaliation complaint under the Affordable Care Act, which a second ALJ dismissed as not timely filed. On appeal, the Complainant argued that the ACA complaint was timely because it related back to the earlier SOX/CFPA complaint. The ARB found that the ALJ had correctly determined that, construing the original complaint in the light most favorable to the Complainant, it had not contained any allegations that could be construed as retaliation covered under the ACA, and that any documents referencing violations of the COBRA law of 1985 were not sufficient to raise a claim under the ACA. Thus, the ARB affirmed the ALJ's dismissal of the ACA complaint as it was filed well over 180 days beyond the statutory limitations period.
MOTION TO REOPEN BASED ON FAMILY MEMBER'S FAILURE TO RECOGNIZE SIGNIFICANCE OF ARB'S CERTIFIED MAIL AND SLIGHT MISSPELLING OF COMPLAINANT'S NAME; MOTION DENIED WHERE ORDER WAS SENT TO ADDRESS OF RECORD AND COMPLAINANT FAILED TO SHOW DUE DILIGENCE IN FILING MOTION TO REOPEN, HAVING WAITED SIX MONTHS
In Blake v. Mast Drug Co., Inc. , ARB No. 13-020, ALJ No. 2012-ACA-2 (ARB Sept. 25, 2013), because the Department of Labor had not yet issued regulations governing the procedure for adjudication of ACA whistleblower complaints, the ALJ forwarded his decision to the ARB and suggested that a party seeking to challenge the decision file a petition for review with the ARB. The ARB issued an order by certified mail setting a deadline for the filing of a petition, and after receiving no petitions, issued an order closing the case. The Complainant filed a motion for reconsideration on the ground that the address used by the ARB to issue its order was an address at which his son was living. The Complainant stated that because the letter was addressed to "Roy" rather than "Rory" Blake, his son did not pay attention to the letter because he assumed that if the person sending it had not taken care to spell the Complainant's name correctly, it must not be important. The ARB denied reconsideration because the address used had been the only address of record for the Complainant, the Complainant did not explain why he had not filed a petition as suggested by the ALJ, the misspelling of the Complainant's name was not a sufficient basis for reopening the final decision, and the Complainant failed to demonstrate due diligence because he waited six months after the order closing the case to recontact the ARB to request reopening of the case (the Complainant having filed a petition for review a few days after the notice of case closing). One member of the Boarded concurred with denial of reconsideration only on the due diligence ground.
PROTECTED ACTIVITY UNDER ACA; THE TERM "TITLE I" IN SECTION 218C REFERS TO TITLE I OF ACA, NOT TITLE I OF THE FAIR LABOR STANDARDS ACT (FLSA), AND THEREFORE COMPLAINTS ALLEGING RETALIATION FOR REPORTING VIOLATIONS OF FLSA ARE NOT PROTECTED UNDER SECTION 218C.
In Rosenfield v. GlobalTranz Enterprises, Inc. , No. CV 11-02327-PHX-NVW, 2012 WL 2572984 (D.Ariz. July 2, 2012), the plaintiff, a human resources manager, alleged that she was terminated in retaliation for reporting perceived violations of the Fair Labor Standards Act ("FLSA") to her supervisors. She filed a complaint under 29 U.S.C. § 218c ("ACA"), which was created by the Patient Protection and Affordable Care Act of 2010 ("ACA"). The court concluded that Section 218c did not create a cause of action for individuals that claim retaliation based complaints about violations of the FLSA. The plaintiff argued that the word "title" in Section 218c(5) - which protects individuals that object or refuse to participate in any activity reasonably believed to be a violation of "any provision of this title (or amendment), or any order, rule, regulation, standard, or ban under this title (or amendment) - refers to Title 29 of the United States Code, and thus protects individuals from retaliation for objections about FLSA violations. The court agreed with the defendant, however, that "title" refers to Title I of ACA. Consequently, the court dismissed the plaintiff's complaint.
PETITION FOR REVIEW OF AFFORDABLE CARE ACT ALJ DECISION WHERE PROCEDURAL REGULATIONS NOT YET PROMULGATED; WHERE NO PARTY FORMALLY PETITIONS FOR ARB REVIEW, ALJ'S DECISION BECOMES FINAL DECISION OF THE DEPARTMENT OF LABOR
In Blake v. Mast Drug Co., Inc. , ARB No. 13-020, ALJ No. 2012-ACA-2 (ARB Dec. 17, 2012), the ALJ referred the case to the ARB for possible review because regulations governing the procedure for review of an ALJ decision under the employee protection provisions of the Affordable Care Act had not yet been promulgated. The ARB directed the parties to file a petition for review if such review was sought. When neither party filed a petition, the ARB closed the case noting that the ALJ's decision would be the final order for the Department of Labor in the case.
SOX AND CFPA RETALIATION CLAIMS WERE NOT IMPERMISSIBLY DUPLICATIVE CLAIMS OF EARLIER DODD-FRANK CLAIM WHERE WAITING PERIODS FOR FILING DE NOVO ACTION HAD NOT YET EXPIRED
In Murray v. UBS Securities, LLC , No. 14-cv-927 (S.D.N.Y. Feb. 24, 2015) (2015 WL 769586; 2015 U.S. Dist. LEXIS 22024), Plaintiff had filed suit in district court alleging termination in violation of Dodd-Frank, and on the same day filed complaints with the USDOL alleging termination in violation of SOX and the CFPA. The latter statutes' anti-retaliation provisions require that complaints first be filed with the Secretary of Labor, but allow complainants to file actions in federal court if no decision has been rendered by DOL within, respectively, 180 and 210 days. Plaintiff suggested that he would seek leave to amend his Dodd-Frank complaint by adding his SOX and CFPA claims once the necessary period had elapsed. Plaintiff did not amend that complaint, but rather filed a claim shortly after the court's opinion compelling arbitration of Plaintiff's Dodd-Frank claim. The new claim was based on Plaintiff's rights to bring SOX and CFPA claims de novo due to the failure of DOL to act. The court held that because the statutory waiting periods barred suit on Plaintiff's SOX and CFPA claims at the time of his earlier Dodd-Frank suit, Plaintiff's current claims were not impermissibly duplicative.
CONSUMER FINANCIAL PROTECTION ACT RETALIATION PROVISION REQUIRES ACTUAL CFPB REGULATION TO PROVIDE COVERAGE
In Murray v. UBS Securities, LLC , No. 14-cv-927 (S.D.N.Y. Feb. 24, 2015) (2015 WL 769586; 2015 U.S. Dist. LEXIS 22024), Plaintiff, a Senior Commercial Mortgage-Backed Security Strategist and Executive Director performed research and created reports for Defendant's clients with regard to its products, services and transactions regulated by the SEC and the Consumer Financial Protection Bureau ("CFPB"). Plaintiff alleged that senior personnel made a "concerted effort" to influence him to skew his research to improve market conditions for its products and to produce reports about their products and services that did not conform with Federal consumer financial law but were intended to be unfair and deceptive. Plaintiff maintained that while he did not publish any report inconsistent with his research, he was criticized by his supervisors with regard to the "off-message" nature of his articles and excluded from meetings. Plaintiff maintained that he reported these negative encounters and exclusions to managers. Plaintiff alleged that his termination was motivated, in part, by his reporting the attempts by UBS personnel to skew his research to his supervisors. Plaintiff claimed that his termination thus violated the anti-retaliation provisions of Sarbanes-Oxley and the Consumer Financial Protection Act (CFPA). The court granted Defendant's motion to dismiss the CFPA claim.
The CFPA's anti-retaliation provision defines a "covered employee" as "any individual performing tasks related to the offering or provision of a consumer financial product or service." 12 U.S.C. Section 5567(b). In relevant part, the CFPA defines a "consumer financial product or service" as "any financial product or service" within a list of enumerated products. 12 U.S.C. Section 5481(5). The district court held that Plaintiff could not reasonably have believed that his reports or covered services fell within the Dodd-Frank/CFPA's provision defining a financial product or service as 'such other financial product or service as may be defined by the [CFPB], by regulation, for purposes of this title'." 12 U.S.C. Section 5481(15)(A)(xi). The Court rejected Plaintiff's contention that such phrase defined a covered product or service as one which the CFPB had the authority to cover. Rather, it is a catch-all provision that requires enactment of an actual CFPB regulation; it does not extend coverage to regulations that did not exist at the time of Plaintiff's conduct. The court summarized:
Because the CFPA's catch-all provision requires an actual CFPB regulation to provide coverage, and because no such regulation existed at the time of Plaintiff's conduct, it was not reasonable for Plaintiff to believe that his reports were covered products or services within the meaning of 12 U.S.C. § 5481. Accordingly, his claim of retaliatory termination in violation of the CFPA is dismissed.
Slip op. at 13-14.
TRIBAL SOVEREIGN IMMUNITY NOT SHOWN TO BE ABROGATED BY CONGRESS OR WAIVED BY THE MOHEGAN TRIBE IN REGARD TO A CONSUMER FINANCIAL PROTECTION ACT WHISTLEBLOWER COMPLAINT
In Stroud v. Mohegan Tribal Gaming Authority , ARB Nos. 13-079, 14-013, ALJ Nos. 2013-ACA-3, 2013-CFP-3 (ARB Nov. 26, 2014), the Complainant filed a Sarbanes-Oxley Act and a Consumer Financial Protection Act claim against the Mohegan Tribal Gaming Authority, which was owed by the Mohegan Tribe, a tribal sovereign nation. The ARB affirmed the ALJ's summary decision dismissing the SOX and CFPA claims. In regard to the SOX complaint, the ARB found that the Mohegan Tribe was not a publicly traded company as defined in 18 U.S.C.A. 1514A(a), nor a contractor, subcontractor or agent of such a company. In regard to the CFPA claim, the ARB found that the Complainant had presented no evidence that Congress had abrogated tribunal sovereign immunity or that the Mohegan Tribe had waived immunity from suit.
FILING OF AMENDED COMPLAINT OPENS THE DOOR FOR A DEFENDANT TO RAISE NEW AFFIRMATIVE DEFENSES
In Zilleges v. Kenney Bank & Trust , No. 13-C-1287 (E.D. Wis. Oct. 20, 2014), the Plaintiff never filed his Consumer Financial Protection Act whistleblower discrimination complaint with the Secretary of Labor, and the Defendant moved to dismiss based on the contention that the requirement to file such a complaint is jurisdictional. The Plaintiff argued that filing with the Secretary is not jurisdictional and that defendant forfeited its failure to file as an affirmative defense where it failed to raise failure to exhaust in its original answer. The court found that the Defendant had not forfeited the defense because the Defendant pleaded failure to exhaust administrative remedies in its answer to the Plaintiff's First Amended Complaint. The court found that the Defendant's failure plead the defense in its answer to the original complaint was inconsequential, the amended complaint having opened the door for the Defendant to raise new affirmative defenses. The court found unpersuasive the Plaintiff's argument that the Defendant's failure to raise lack of exhaustion in its original answer had caused him prejudice because it would have alerted him in time to file a timely complaint with Secretary. The court stated: "It is not the purpose of Rule 8(c) to remind the plaintiff of any prerequisites to suit that he or she may have failed to fulfill." Slip op. at 3. Because the Plaintiff conceded that he had not filed a timely CFPA complaint with the Secretary of Labor, the court granted the Defendant's motion to dismiss the CFPA count.
CPSIA WHISTLEBLOWER PROVISION DOES NOT COVER DEVICES REGISTERED UNDER THE FDA; DISMISSAL NOT WARRANTED WHERE DEFENDANT'S EXHIBITS DID NOT SHOW THAT REGISTERED DEVICES WERE THE SAME AS THE DEVICES AT ISSUE IN THE ACTION
In Rock v. Lifeline Systems Co. , No. 13-11833 (D. Mass. Apr. 22, 2014)(2014 WL 1652613), the Plaintiff was a sales person who charged that she was illegally terminated from employment under several laws for reporting a fire hazard with the Defendant's medical alert devices. The Defendant moved to dismiss a claim under the whistleblower provision of the Consumer Product Safety Improvement Act, 15 U.S.C. § 2087, on the ground that the Defendant's devices were registered under the Federal Food, Drug, and Cosmetic Act, and consequently such devices are not consumer products covered by the CPSIA. See 15 U.S.C. § 2052(H)(5). The Defendant supported its motion with exhibits. The Plaintiff conceded that if the devices were registered under the FDA, the CPSIA claim could not be maintained, but disputed the accuracy of the exhibits and whether they covered the devices at issue in the action. The court denied the motion to dismiss because the registered devices in the exhibits were not necessarily the devices at issue.
EXHAUSTION OF ADMINISTRATIVE REMEDIES; ON FRCP 12(b)(6) MOTION, COURT WAS WILLING TO DRAW REASONABLE INFERENCE THAT COMPLAINT WAS TIMELY FILED WITH DOL AND THAT PLAINTIFF WAITED SUFFICIENT TIME WITHOUT A FINAL DOL DECISION BEFORE FILING IN DISTRICT COURT
In Rock v. Lifeline Systems Co. , No. 13-11833 (D. Mass. Apr. 22, 2014)(2014 WL 1652613), the Plaintiff was a sales person who charged that she was illegally terminated from employment under several laws for reporting a fire hazard with the Defendant's medical alert devices. The Defendant moved to dismiss a claim under the whistleblower provision of the Consumer Product Safety Improvement Act, 15 U.S.C. 2087, on the ground that the Defendant had not exhausted her administrative remedies, citing Jallali v. USA Funds , 2012 WL 32918783 at *5 (S.D.Fla. Aug. 13, 2012). The court found that Jallali was inapplicable as in that case the Plaintiff had not alleged that it complied with any of the procedural requirements of 15 U.S.C. § 2087(b) and had not addressed arguments that she failed to exhaust her administrative remedies. Here, the Plaintiff had timely filed SOX whistleblower complaint with DOL, and later added a CPSIA complaint. The Plaintiff filed in district court after the DOL had not issued a final decision within 180 days of the filing of the complaint. The court found: "Although [the Plaintiff] did not specify the date she added the CPSIA charge, a reasonable inference can be drawn that [the Plaintiff] properly filed the CPSIA charge within the requisite 180 day time period." Again interpreting the record in [the Plaintiff's] favor, a reasonable inference therefore arises that she complied with section 2087(b)(4)'s filing requirements by waiting the requisite 210 days before filing suit in this court." Slip op. at 31-32 (citations omitted).
COMPLAINANT MUST BE AFFORDED REASONABLE TIME AND OPPORTUNITY TO RESPOND TO A SUBSTANTIAL MOTION FOR SUMMARY DECISION; ALJ, HOWEVER, MAY REQUIRE COMPLAINANT TO STATE WITH SOME PRECISION WHAT MATERIALS HE HOPES TO OBTAIN WITH DISCOVERY AND HOW THEY WOULD HELP IN OPPOSING SUMMARY DECISION
In Saporito v. Publix Super Markets, Inc. , ARB No. 12-109, ALJ No. 2010-CPS-1 (ARB Apr. 30, 2013), the ARB found that the ALJ abused his discretion in cutting off all discovery and refusing to grant the Complainant any additional time to respond to the Respondent's substantial motion for summary decision. The ARB remanded for the ALJ to (1) permit the Complainant to engage in limited discovery within the ALJ's discretion and (2) allow for a reasonable opportunity to file a timely response to motions. The ARB, however, stated that the ALJ "may consider on remand that a party opposing summary decision "is required to state with some precision the materials he hopes to obtain with further discovery, and exactly how he expects those materials would help him in opposing summary judgment.'" USDOL/OALJ Reporter at 6 (footnote omitted).
PROTECTED ACTIVITY; COVERAGE UNDER CPSIA IS NOT LIMITED TO "CONSUMER PRODUCTS" AND IS NOT LIMITED TO MATTERS STRICTLY UNDER THE JURISDICTION OF THE CONSUMER PRODUCTS SAFETY COMISSION
In Saporito v. Publix Super Markets, Inc. , ARB No. 10-073, ALJ No. 2010-CPS-1 (ARB Mar. 28, 2012), the Respondent was a supermarket chain that operated a dairy plant at which the Complainant was employed as a maintenance technician. The Complainant complained to supervisors that the outside contact surfaces of plastic milk bottles, and the containers used to carry the plastic milk bottles, were being contaminated with harmful chemicals and waste from the conveyor system and failure to maintain proper pressurization of the milk filling room. The Complainant filed a whistleblower complaint under the Consumer Product Safety Improvement Act of 2008 (CPSIA or Act), 15 U.S.C.A. § 2087, alleging a hostile work environment. Later, when fired, the Complainant amended his complaint alleging that the discharge was due to protected activity.
After issuing a order to show cause requiring the Complainant to establish that (1) his complaints related to "covered consumer products" and (2) each named Respondents is a "manufacturer, distributer, retailer, or labeler of consumer products," the ALJ dismissed the complaint based on failure to state a claim upon which relief may be granted.
CPSIA's coverage is not limited to regulation of "consumer products"
The ARB found that the ALJ erred in requiring the Complainant to show that his complaints were related to "consumer products" as defined by the Act. The ARB wrote:
For proper context, it is important to recognize the expressed purposes of the Consumer Product Safety Improvement Act, which contains the whistleblower provision relevant to this case. Pursuant to the Consumer Product Safety Act (CPSA), 15 U.S.C.A. §§ 2051 (Thomson Reuters/West 2009), as amended by the CPSIA, Congress found that "an unacceptable number of consumer products which present unreasonable risks of injury are distributed in commerce" and that "the public should be protected from theses unreasonable risks." 15 U.S.C.A. §§ 2051(a)(1), (2). Logically, then, one of the CPSA's expressed "purposes" is to "protect the public against unreasonable risks of injury associated with consumer products." 15 U.S.C.A. §§ 2051(b). The statute and regulations generally define the term "consumer product" to include any article or portion of an article sold to consumers for the use or personal use, consumption, or enjoyment in a household, residence, or school. 15 U.S.C.A. §§ 2052(a)(5). The CPSIA expressly excludes "food" from the definition of "consumer product," as "food" is defined under the Federal Food, Drug, and Cosmetics Act (FFDCA) at 21 U.S.C.A. §§ 321(f) (Thomson Reuters/West 2009).
The CPSA established a Consumer Product Safety Commission (the Commission) in furtherance of these goals. The CPSA, as amended by the CPSIA, empowers the Commission to enforce the CPSA and the CPSIA, along with any other federal act Congress has added to the Commission's oversight authority, resulting in a labyrinth of enforcement power. For instance, the Commission also enforces the Federal Hazardous Substances Act (FHSA), 15 U.S.C.A. §§ 1261 et seq . (Thomson Reuters/West 2009), and the Poison Prevention Packaging Act (PPPA), 15 U.S.C.A. §§ 1471 et seq . (Thomson Reuters/West 2009). Under the PPPA, the Commission regulates packaging of "household substance[s]" which can include "food" as defined under the FFDCA at 21 U.S.C.A. §§ 321(f). Under the FHSA, the Commission regulates "hazardous substances," a term not restricted to "consumer products" and which includes household substances that expose children to a hazardous quantity of lead (e.g., candy wrappers). Clearly, the Commission's power extends beyond the regulation of "consumer products."
USDOL/OALJ Reporter at 4-5 (footnotes omitted).
CPSC's jurisdiction; reasonable belief
The ARB found that the ALJ also committed legal error in basing his dismissal on a finding that none of the Complainant's complaints fell within the Consumer Product Safety Commission's jurisdiction. The ARB wrote:
The ALJ erred in focusing strictly on the limit of the Commission's jurisdiction. The ALJ plausibly reasoned that if the Commission did not have jurisdiction at the time of Saporito's disclosure, then Saporito's disclosure or complaint was not protected activity under the CPSIA whistleblower provision. But limiting CPSIA-protected activity coverage entirely to the CPSC's jurisdiction leaves out a critical part of the CPSIA definition of protected activity: reasonable belief.
The CPSIA broadly defines protected disclosures to include disclosures "relating" to employer conduct that the employee " reasonably believes to be a violation of any provision of [the CPSIA] or any Act enforced by the Commission . . . ." 15 U.S.C.A. §§ 2087(a)(1) (emphasis added). The CPSIA's plain language allows the complainant to be wrong as long as he held a reasonable belief of a violation of the Act or other act enforced by the Commission. The Act does not define "reasonable belief." Historically, the ARB has interpreted the concept of "reasonable belief" to require both a subjectively and objectively reasonable belief. A subjectively reasonable belief means that the employee actually believed that the conduct he complained of constituted a violation of relevant law. See, e.g., Harp v. Charter Commc'ns , 558 F.3d 722, 723 (7th Cir. 2009) (not a CPSIA case). An objectively reasonable belief means that a reasonable person would have held the same belief having the same information, knowledge, training, and experience as the complainant. Harp, 558 F.3d at 723. Often the issue of "objective reasonableness" involves factual issues and cannot be decided in the absence of an adjudicatory hearing. See, e.g., Allen v. Admin. Review Bd., 514 F.3d 468, 477-478 (5th Cir. 2008) ("the objective reasonableness of an employee's belief cannot be decided as a matter of law if there is a genuine issue of material fact"). Nowhere did the ALJ address the issue of reasonable belief in resolving his Order to Show Cause.
USDOL/OALJ Reporter at 6-7 (footnotes omitted).
DISMISSAL GROUNDED IN ALJ'S SUA SPONTE ORDER TO SHOW CAUSE RATHER THAN MOTION FILED BY RESPONDENT; DUE PROCESS AND ADEQUACY OF NOTICE OF ULTIMATE GROUND FOR DISMISSAL
PROTECTED ACTIVITY; CPSIA ONLY REQUIRES THAT THE COMPLAINANT HAD A REASONABLE BELIEF OF VIOLATION, AND DOES NOT REQUIRE A REASONABLE BELIEF OF HARM
In Saporito v. Publix Super Markets, Inc. , ARB No. 10-073, ALJ No. 2010-CPS-1 (ARB Mar. 28, 2012), the Respondent was a supermarket chain that operated a dairy plant. The Complainant, a maintenance technician, complained to supervisors that the outside contact surfaces of plastic milk bottles, and the containers used to carry the plastic milk bottles, were being contaminated with harmful chemicals and waste from the conveyor system and failure to maintain proper pressurization of the milk filling room. The Complainant filed a whistleblower complaint under the Consumer Product Safety Improvement Act of 2008 (CPSIA or Act), 15 U.S.C.A. § 2087. OSHA dismissed on the ground that food safety complaints were not covered under the CPSIA.
Upon the Complainant request for a hearing, the presiding ALJ issued an order to show cause requiring the Complainant to establish that (1) his complaints related to "covered consumer products" and (2) each named Respondents is a "manufacturer, distributer, retailer, or labeler of consumer products." Nothing further was required by the ALJ's order. The ALJ dismissed the complaint based on failure to state a claim upon which relief may be granted. The ARB found that the matter must be remanded because the ALJ erred in concluding that CPSIA coverage was limited to "consumer products," but went on to address other errors.
In part, the ALJ's dismissal was based on his finding that the Complainant's complaints were not protected because they were speculative. The Complainant had only alleged that milk containers "could" be contaminated and "could" reach and "possibly" or "would" injure consumers.
The ARB found that the order to show cause had given no indication that the ALJ would consider whether the complaints were too speculative to constitute protected activity, and therefore as a matter of due process dismissal on this ground could not be affirmed, and the matter needed to be remanded for further proceedings.
The ARB recognized that the ALJ in order to avoid being an advocate for the Respondent, could not elaborate too much in an order to show cause, and observed that the "need for caution makes orders to show cause less effective than a party's motion for summary decision, where the party can fully and fiercely advocate and flesh out the grounds for dismissal." USDOL/OALJ Reporter at n.28. The ALJ's caution, however, did not alleviate the due process concerns where the order to show cause gave no indication that the issue would be considered.
The ARB also noted that the ALJ's ruling conflated the Complainant's speculation as to potential harm with speculation as to a violation, and observed that the CPSIA requires reasonable belief of a violation and does not expressly require reasonable belief of harm.
PROTECTED ACTIVITY & CAUSAL CONNECTION UNDER FLSA
In Wolinsky v. Standard Oil of Connecticut, Inc. , No. 3:08cv832 (D. Conn. May 5, 2010), a former employee brought an action in state court against his former employer and supervisor, alleging that he was retaliated against for engaging in activity protected by the Fair Labor Standards Act (FLSA). The defendants removed action to federal District Court and moved for summary judgment. The District Court held that: (1) temporal proximity of one day between employee's complaints to state and federal labor departments and adverse employment action was sufficient to establish causal connection required for prima facie FLSA retaliation claim; and (2) there was a genuine issue of material fact precluding summary judgment on the FLSA retaliation claim.
See Babick v. Todd Pacific Shipyards Corp. , BRB No. 14-0177 (Mar. 30, 2015) (per curiam) (Employer's burden under Section 49 of the LHWCA on rebuttal is only of production; ultimate burden of persuasion is on the claimant).
INTERLOCUTORY APPEAL; ALJ’S DENIAL OF MOTION FOR SECOND AMENDMENT OF COMPLAINT; ARB IS RELUCTANT TO INTERFERE WITH ALJ’S CONTROL OVER THE COURSE OF A HEARING
In Graves v. MV Transportation, Inc. , ARB No. 15-058, ALJ No. 2015-NTS-1 (ARB May 29, 2015), the Complainant sought ARB review of the ALJ’s "Order Striking Second Amended Complaint." The ALJ had stricken the second amended complaint because the Complainant had not followed the procedure the ALJ had established in an order issued following a conference call. The ALJ had granted leave to amend the complaint based on the Complainant’s argument that he needed first to obtain certain documents from OSHA. The motion to amend later filed by the Complainant, however, appeared to allege new adverse actions that did not appear to be based on the documents the Complainant was attempting to obtain from OSHA, and which had not been mentioned earlier by the Complainant. The ARB denied interlocutory review, finding that the Complainant had not established that his appeal fell within the collateral order exception, and noting that it is "very reluctant to interfere with an ALJ’s control over the course of a hearing." USDOL/OALJ Reporter at 5.
PUNITIVE DAMAGES IN NTSSA WHISTLEBLOWER CASE DENIED WHERE RESPONDENT'S CONDUCT DID NOT AMOUNT TO RECKLESS OR CALLOUS DISREGARD FOR THE COMPLAINANT'S RIGHTS OR INTENTION VIOLATION OF FEDERAL LAW
In Graves v. MV Transportation, Inc. , ARB No. 12-066, ALJ No. 2011-NTS-4 (ARB Aug. 30, 2013), the Complainant appealed the ALJ's denial of punitive damages in a National Transit Systems Security Act whistleblower case. The ARB affirmed the denial, finding that substantial evidence supported the ALJ's determination. The Complainant had refused to back his bus into a parking spot without a spotter. The Complainant was told to leave his bus in the yard until grievance proceedings were resolved. The union grievance process resulted in a settlement in which the Respondent agreed to expunge the Complainant's record and to provide spotters. A day or two later, the Complainant was again instructed by the yard supervisor to back his bus into a parking spot without a spotter. The Complainant refused and left his bus in the yard. A few days later, a company-wide memo was distributed instructing drivers on the night shift to leave their buses in the yard without parking them. The Respondent did not discipline the Complainant prior to issuance of this memo. The ARB held that the Respondent's actions did not rise to the level of establishing grounds for awarding punitive damages to the Complainant. The ARB chose not to disturb the ALJ's finding that under the facts of the case, the harassment by the yard supervisor did not amount to reckless or callous disregard for the Complainant's rights, or intentional violations of federal law.
TIMELINESS OF OPENING BRIEF BEFORE ARB; WHERE ARB HAD IN AN ORDER TO SHOW CAUSE DIRECTED THAT OPENING BRIEF BE RECEIVED BY THE ARB BY A CERTAIN DATE, MERE PROOF OF TIMELY MAILING OF BRIEF INSUFFICIENT TO SUPPORT MOTION FOR RECONSIDERATION OF EARLIER DENIAL; IN SUCH CIRCUMSTANCES, DUE DILIGENCE MANDATES THAT LITIGANT CONTACT THE ARB TO VERIFY TIMELY RECEIPT AND SEEK PERMISSION TO FAX IF RECEIPT IS NOT CONFIRMED
In Castillo v. Bayside Engineering, Inc. , ARB No. 11-046, ALJ No. 2011-NTS-2 (ARB Apr. 24, 2013), the ARB had dismissed the Complainant's appeal for failure to respond to the Board's order to show cause in regard to the failure to timely file an opening brief. The Complainant sought reconsideration arguing that he had in fact filed an opening brief in response to the order to show cause. In support, the Complainant submitted certified mail receipts. The receipts showed a mailing to the same zip code as the ARB's zip code; but they did not show where, when, or if the envelopes were delivered. The ARB denied reconsideration because even accepting as fact that the Complainant timely placed his brief in the mail, the fact remained that the ARB did not receive the brief as ordered. The ARB noted that, given that its order to show cause mandated that the brief be received by a certain date, the Complainant demonstrated a lack of diligence in failing to contact the ARB to determine if it had been received as ordered. The ARB stated that had he done so and learned that the brief had not ben received, he could have sent the brief by facsimile and met the deadline.
The ARB also noted that the brief that was purportedly submitted did not comply with the ARB's order to show cause because the Board's order had directed that an explanation be provided for why the brief had not been timely filed in response the Board's earlier briefing order, and no explanation had been proffered. Finally, the ARB noted that given the Complainant's pro se status, it had reviewed the untimely brief to determine if affirmance of the ALJ's decision would result in a grave miscarriage of justice. The ARB found no error of fact or law identified in the brief that would have compelled the ARB to reverse the ALJ's determination that the original complaint had not been timely filed and that equitable tolling was not warranted.
SUMMARY JUDGMENT NOT GRANTED WERE REASONABLE JURY COULD FIND PROTECTED ACTIVITY IN REPORTING OF SAFETY CONCERNS WITH SUBWAY GATES; ADVERSE EMPLOYMENT ACTION; CAUSATION; AND LACK OF CLEAR AND CONVINCING EVIDENCE THAT DEFENDANTS WOULD HAVE TAKEN SAME ADVERSE ACTION IN ABSENCE OF PROTECTED ACTIVITY
In Nichik v. New York City Transit Authority , No. 1:10-cv-05260 (E.D.N.Y. Jan. 11, 2013), the Plaintiff, a superintendent for the New York City Transit Authority, alleged that he was retaliated against by the Defendants for reporting unsafe conditions related to gates in New York City subway stations under several laws, including the National Transit Systems Security Act ("NTSSA"), 6 U.S.C. § 1142. The Defendants filed a motion for summary judgment. The district court judge noted that there was little caselaw regarding the NTSSA, but that the parties agreed that he could look to other whistleblower statutes for guidance, including the SOX, 18 U.S.C.A. 1514A.
The NTSSA protects transportation employees who make reports regarding hazardous safety or security conditions on the public transportation system. § 1142(b)(1)(A). The Defendants had not briefed the issue of protected activity and the court found that the Plaintiff's activities were sufficient to support a jury finding he engaged in protected activity under the NTSSA.
Specifically, the Plaintiff had emailed NYCTA's then president regarding unsafe subway conditions explaining that the gates are required to be secured (whether in the closed or open position), and that the failure to secure them could lead to injuries or fatalities. The Plaintiff expressed concern that this problem may be system-wide. The Plaintiff also provided the president with photographs depicting discrepancies between the reported conditions of the gates and their actual conditions.
Adverse Action; "Materially Adverse" Standard
The Defendants conceded that its "Disciplinary Action Notification" against the Plaintiff was an adverse action, but argued that various other acts were not. The court applied the "material adverse" standard of Burlington N. & Santa Fe R.R. Co. , 548 U.S. 53, 68 (2006), and found that a reasonable jury could find that personnel actions taken against the Plaintiff could dissuade a reasonable NYCTA worker from reporting a hazardous safety or security condition. In the two months following his report of the safety problem with the gates, the Plaintiff had received six reinstructions (a written reminder to an employee to conform his actions to NYCTA requirements) and a citation. The reinstructions were placed in his personnel file and relied upon in making future decisions about discipline; they were used in a "marginal" performance review which in turn resulted in the Plaintiff's not receiving a raise; and there was deposition testimony stating that a reinstruction can be a form of discipline.
Causation; Contributing Factor Standard
The court stated that the NTSSA requires the Plaintiff to demonstrate a causal connection between his protected activity and the adverse actions taken by the Defendants by showing, by a preponderance of the evidence, that the protected activity was a "contributing factor in the unfavorable personnel action" taken against him. § 1142(c)(2)(B)(i).
The Defendants contended that the Plaintiff could not show causal connection because there was lack of temporal proximity between the protected activity and the unfavorable personnel action, i.e., there was a six month period between the Plaintiff's report and the Disciplinary Action Notification. The court, however, found that a reasonable jury could conclude that the reinstructions occurred beginning a month after the report, and demonstrated temporal proximity. The court also noted that there was direct and circumstance evidence of retaliatory animus supporting a causal connection. For example, the Plaintiff had "good" ratings on his yearly managerial performance reviews in the six years preceding the protected activity. In the eight months prior to the protected activity, the Plaintiff had received only two reinstructions, but beginning a month later, he began to receive numerous reinstructions and write-ups. While the Defendants provided explanations for the reinstructions and the Disciplinary Action Notification, the court found that those arguments were more appropriately addressed by a jury.
Non-retaliatory Defense; Clear and Convincing Evidence Standard; Evidence That Other Managers Would Not Have Been Disciplined for Similar Actions As Preventing Summary Judgment
The court noted that "[i]n a NTSSA action, an employer may defeat a prima facie case of retaliation at the summary judgment stage if it can show that no genuine issue of material fact exists that would preclude the conclusion, by clear and convincing evidence, that defendant ‘would have taken the same unfavorable personnel action in the absence of [the protected] behavior.’ See § 1142(c)(2)(B)(iv)." Nichik , supra , slip op. at 11.
The Defendants argued that the Plaintiff had a long record of poor and marginal performance as a superintendent, including submitting monthly reports late, failing to inspect his station, and failing to report to a station where a dead person was found in a restroom, despite being instructed to do so by his supervisor. The Defendants contended that the Plaintiff's insubordination left them with no choice but to discipline and suspend him. The court, however, found that there was evidence that other employees in managerial positions would not have been disciplined for similar conduct, and that on the record before him, he could not conclude as a matter of law that the Defendants demonstrated by clear and convincing evidence that the Plaintiff's infractions would have necessarily resulted in unfavorable employment actions independent of any retaliatory motive.
REQUEST FOR HEARING PRIOR TO ISSUANCE OF SECRETARY'S FINDINGS BY OSHA BASED ON CONSTRUCTIVE DENIAL THEORY; COMPLAINANT CARRIES BURDEN OF ESTABLISHING OALJ AUTHORITY TO PROVIDE SUCH EQUITABLE RELIEF AND THAT GROUNDS EXIST FOR GRANTING SUCH RELIEF
In Graves v. MV Transportation, Inc. , 2012-NTS-1 (ALJ June 8, 2012), the Complainant requested a hearing alleging that OSHA had failed to complete its investigation in a timely manner. The Chief ALJ isseud an order directing the parties to brief whether OALJ had the authority to take jurisdiction over the matter under a theory of constructive denial, and whether grounds existed for granting such relief in the instant case. The Assistant Secretary for OSHA was the only party to submit a brief on the matter. Noting that the Complainant's hearing request prior to issuance of the Secretary's Findings by OSHA was a request for extraordinary equitable relief, and that the only argument from the Complainant was the allegation that OSHA failed to complete its investigation in a timely fashion, the Chief ALJ found that the Complainant had failed to carry his burden to establish both OALJ's authority to assume jurisdiction and that grounds existed for exercise of such authority in the instant case. Thus, the hearing request was dismissed without prejudice. In view of this disposition of the hearing request, the Chief ALJ did not address the Assistant Secretary's argument that a claim of constructive denial of due process for an alleged failure of OSHA to timely complete its investigation should never succeed where a statute allows a complainant to file in district court if the Secretary delays issuance of a final order. See 6 U.S.C. § 1142(c)(7); 29 C.F.R. § 1982.1114.
SUMMARY DECISION; ALJ'S OBLIGATION TO NOTIFY PRO SE LITIGANT OF REQUIREMENTS FOR RESPONDING TO MOTION FOR SUMMARY DECISION
In Motarjemi v. Metropolitan Council Metro Transit Division , ARB No. 08-135, 2008-NTS-2 (ARB Sept. 17, 2010), the ALJ issued a decision granting the Respondent's motion for summary decision because the Complainant had not responded to the motion. The ARB found that this was error:
In Hooker v. Washington Savannah River Co. , [ARB No. 03-036, ALJ No. 2001-ERA-016 (ARB Aug. 26, 2004)] the ARB adopted federal precedent requiring a judge to give a pro se complainant notice of the requirements for opposing a motion for summary judgment, and the right to file pleadings, affidavits, or other evidence in response to the motion. We held that the ALJ in that case erred in granting summary judgment on Hooker's constructive discharge and blacklisting claims because he failed to inform Hooker of "his right to file affidavits or 'other responsive materials' and did not warn him that failing to respond could mean that his case would be over."
In this case, the record does not indicate that the ALJ informed Motarjemi, prior to issuance of the R. D. & O, of his right to oppose the Motion. Instead, the ALJ dismissed Motarjemi's complaint without informing him of the consequences for failing to respond to the Motion. This constitutes prejudicial error by the ALJ.
We noted in Hooker that, when being notified of the requirements for responding to a motion for summary decision, a pro se litigant is entitled to "a form of notice sufficiently understandable to one in appellant's circumstances fairly to apprise him of what is required." Accordingly, we direct the ALJ to provide Motarjemi with a notice containing: (1) the text of the rule governing summary decisions before ALJs (i.e., 29 C.F.R. § 18.40), and (2) a short and plain statement that factual assertions in Metro Transit's affidavits will be taken as true unless he contradicts Metro Transit with counter-affidavits or other documentary evidence.
Motarjemi must be given an opportunity to respond to the Motion so that he may, as described above, set forth specific facts showing that there is a genuine issue of fact for a hearing.
USDOL/OALJ Reporter at 4 (footnotes omitted).
CONFLICT BETWEEN PSIA REGULATIONS AND ENVIRONMENTAL STATUTE REGULATIONS ON APPLICATION OF FORMAL RULES OF EVIDENCE; WHERE COMPLAINT ALLEGED VIOLATIONS OF BOTH PSIA AND ENVIRONMENTAL STATUTES FOR THE SAME CONDUCT; ALJ DETERMINED THAT IT WOULD BE NECESSARY TO APPLY A SINGLE EVIDENTIARY STANDARD AND THAT THE LESS FORMAL STANDARD OF THE PSIA REGULATIONS SHOULD APPLY
In Pedersen v. ASRC Energy Services, Inc. , 2013-CER-1 (ALJ May 6, 2014), the Complainant filed a complaint with OSHA under the whistleblower provisions of the Pipeline Safety Improvement Act (PSIA) and five environmental statutes (SWDA, SWDA, FWPCA, TSCA, and CERCLA). In an earlier order concerning a motion for summary decision, the ALJ ordered that the less formal rules of evidence applied in PSI cases would apply at the hearing. Later, during a pre-trial conference, the ALJ modified this order to apply the formal rules of evidence to evidence regarding exemplary damages under the SDWA and the TSCA. The Respondent moved for reconsideration.
The ALJ noted that the PSIA regulations expressly reject application of formal rules of evidence. See 29 C.F.R. § 1981.107(d); 70 Fed. Reg. 17889, 17892. The regulations applying to the five environmental statutes require application of formal rules of evidence. See 29 C.F.R. § 24.107(a). In the instant case, the complaint alleged that the same conduct violated both the PSIA and the other five statutes, thereby setting up the need to select a framework for questions of admissibility of evidence. The ALJ concluded that simultaneous application of two sets of rules would be unwieldy and unworkable, and that he would apply the regulations that permit an ALJ to waive any rule or to issue any order that justice or administration of the statutes requires. See 29 C.F.R. §§ 24.115, 1981.114. The ALJ rejected the Respondent's contention that such a waiver or order is only permitted upon application of a party, finding that the Respondent had an opportunity to present arguments and to be heard before the wavier is put into place at the hearing.
The ALJ found the less formal evidentiary framework of the PSIA to be more appropriate to apply because they conform to the APA, because the PSIA's burden of proof is more favorable to the Complainant than under the five environmental statutes; with the exception of exemplary damages, the remedies under all the statutes are the same; and "[i]t would arguably infringe on Complainant's due process rights to apply more rigorous evidentiary standards to the [PSIA] because it would reduce his likelihood of success where Congress intended that it be at its highest"; the Respondent would not be unduly burdened as the Complainant only need to prevail on the PSI complaint; the Secretary has favored less formal evidentiary rules in more recently adopted whistleblower regulations; and the ALJ had already ordered the use of more formal rules of evidence in the one area where it could actually disadvantage the Respondent (the exemplary damages issue). The ALJ was not persuaded by the Respondent's argument that it would make more sense to apply the rule for the five environmental statutes, the ALJ finding that due process and general policy considerations outweighed a "majority vote."
The ALJ was not persuaded by the Respondent's argument that the Complainant's pro per status suggests that the court should prefer formal rules. The ALJ found that applying two sets of rules would likely increase the duration and complexity of the hearing. The ALJ stated that he had not based his conclusions in the order based on the Complainant's pro per status, but that if he were to take that into consideration, he would conclude that the hearing would proceed more expeditiously and effectively without formal rules of evidence.
PROTECTED ACTIVITY; WORK REFUSAL BASED ON REASONABLE AND GOOD FAITH BELIEF THAT THE WORK WOULD VIOLATE A FEDERAL PIPELINE SAFETY LAW LOOSES PROTECTED STATUS ONCE RESPONDENT INVESTIGATES AND A SOLUTION IS COMMUNICATED TO COMPLAINANT
Under the whistleblower provision of the Pipeline Safety Improvement Act, an employee who refuses to perform a task because of a pipeline safety concern is not required to establish that the allegedly illegal practice at issue actually violated a Federal law relating to pipeline safety. Rather the employee is only required to prove that his refusal to work was properly communicated to the employer and was based on a reasonable and good faith belief that the work would violate a Federal law relating to pipeline safety. The work refusal, however, loses its protected status after the perceived hazard has been investigated and, if found safe, is adequately explained to the employee. Rocha v. AHR Utility Corp. , ARB No. 07-112, ALJ Nos. 2006-PSI-1 through 4 (ARB June 25, 2009). In Rocha , the ARB found that substantial evidence supported the ALJ's findings that the Respondents and the state officials took the Complainants' concerns about whether corroded pipes could be welded with sufficient quality to safely carry natural gas "very seriously" and investigated to determine whether the pipe was acceptable. The ALJ found that a solution was presented to the Complainants that allowed them to cut and grind the pipes to achieve field quality welds. The ARB agreed with the ALJ's conclusion that, when the Complainants refused to weld after the Respondents offered this solution and did not question the proposed solution, their work refusal lost its protected status.
TIMELINESS OF PETITION FOR JUDICIAL REVIEW OF AGENCY DECISION; TOLLING BASED ON FILING OF MOTION FOR RECONSIDERATION WITH THE AGENCY
In Saban v. USDOL , No. 06-2837 (7th Cir. Dec. 4, 2007) (case below ARB No. 03-143, ALJ No. 2003-PSI-1), the Seventh Circuit held that the Complainant's petition for review of the ARB's denial of his Pipeline Safety Improvement Act whistleblower claim was timely where, although he did not file the petition within 60 days of the ARB's decision denying the claim, he had filed a timely motion for reconsideration with the ARB and then filed his petition for review within 60 days after the Board denied that motion. The court expressed concern that Supreme Court rulings to the effect that the filing of a motion for reconsideration with the agency tolled the time for filing a petition for judicial review had been thrown into doubt by the Supreme Court decision in Darby v. Cisneros , 509 U.S. 137, 145-47 (1993) (citing section 10(c) of the Administrative Procedure Act), but found that it was bound by the earlier Supreme Court authority.
RETROACTIVE APPLICATION OF WHISTLEBLOWER PROVISION OF THE PSIA
The whistleblower provision of the Pipeline Safety Improvement Act does not have restroactive effect. Saban v. USDOL , No. 06-2837 (7th Cir. Dec. 4, 2007) (wrongful termination took place more than three years before the PSIA was passed).
RETROACTIVE APPLICATION OF THE WHISTLEBLOWER PROVISION OF THE PIPELINE SAFETY IMPROVEMENT ACT
In Saban v. Morrison Knudsen , ARB No. 03-143, ALJ No. 2003-PSI-1 (ARB Mar. 30, 2005), the ARB affirmed the ALJ's holding that since the alleged adverse action predated the effective date of the whistleblower protection provision of the Pipeline Safety Improvement Act of 2002, and since Congress did not intend that the Act be applied retroactively, the complaint should be dismissed. See Landgraf v. USI Film Products, 511 U.S. 244 (1994).
PSI INTERIM FINAL RULE
On April 5, 2004, OSHA published an Interim Final Rule stating Procedures for the Handling of Discrimination Complaints under Section 6 of the Pipeline Safety Improvement Act of 2002 , Interim Final Rule, 69 Fed. Reg. 17587 (Apr. 5, 2004). The regulations are similar to the regulations implementing AIR21, nuclear and environmental, and STAA whistleblower laws.
In Saban v. Morrison Knudsen , 2003-PSI-1 (ALJ July 25, 2003), the ALJ found that the statutory language and Congressional history of section 60129 of the Pipeline Safety Improvement Act evidenced no intent by Congress for retroactive application. Accordingly, where Complainant's complaint was about circumstances that occurred in 1999 but the PSI whistleblower provision did not become effective until December 17, 2002, the ALJ granted Respondent's motion to dismiss.
PROTECTED ACTIVITY; WORK REFUSAL LOOSES PROTECTION ONCE PERCEIVED HAZARD INVESTIGATED, FOUND SAFE, AND ADEQUATELY EXPLAINED TO THE EMPLOYEE
In Rocha v. AHR Utility Corp. , 2006-PSI-1 to 4 (ALJ July 25, 2007), the Complainants were experienced welders who refused to continue welding pipe for a gas line that would cross over an Interstate highway based on their belief that if they installed the pipe as requested, a safety risk to the public would result. The ALJ found that the Complainants held this belief in good faith, and that a reasonable person with the Complainants' experience and training would have, under the circumstances, believed that the pipe was unsafe to install in the gas line. The pipe had been left outside for a long period of time and was heavily corroded. The ALJ also found, however, that the representatives of the Respondents and the state DOT took the Complainants' concerns very seriously, and confirmed with engineering staff that the pipe was acceptable. Moreover, they authorized the Complainants to cut back on pipe ends without limit to find acceptable weld locations. The ALJ found that this proposal appeared to have met the Complainants' safety and quality concerns, and fulfilled the Respondents' duty to respond to the Complainants' good faith work refusal. The ALJ found that "any protection the Complainants would have had for their work refusal ceased when they failed to give further explanation or make a further inquiry into the adequacy of respondents' response to their concerns." Slip op. at 12-13 ( citing Stockdill v. Catalytic Indust. Maint. Co., Inc. , 1990-ERA-43, at 3 (Sec'y Jan. 24, 1996).
REQUEST FOR HEARING PRIOR TO ISSUANCE OF SECRETARY'S FINDINGS BY OSHA BASED ON CONSTRUCTIVE DENIAL THEORY; ASSUMING OALJ HAS AUTHORITY TO GRANT RELIEF, IT IS AN EXTRAORDINARY REMEDY THAT MUST BE GRANTED ONLY WITH CAUTION
In Klink v. Bechtel Oil, Gas & Chemicals , 2011-PSI-2 (ALJ Sept. 14, 2011), the Complainant sought an ALJ hearing based on a theory of constructive denial based on information indicating that it may take more than three years for OSHA to complete its investigation. OALJ docketed the matter and solicited briefs. Based on information from the Secretary that OSHA had begun its investigation and that it would complete its investigation within a few months, and assuming arguendo that OALJ has authority to take jurisdiction pursuant to a finding of constructive denial, such a procedure is extraordinary in nature, the Chief ALJ dismissed the hearing request.
DEBARMENT AND CIVIL PENALTIES; IMPOSITION AGAINST VETERANS AFFAIRS MEDICAL CENTER AGAINST PUBLIC POLICY
In Talukdar v. U.S. Dept. of Veterans Affairs Medical & Regional Office Center, Fargo, ND , 2002-LCA-25 (ALJ Apr. 12, 2004), the ALJ found that the Respondent violated the anti-discrimination provision of the H-1B labor condition application regulations when it discharged two physicians after they had cooperated with a DOL investigation into whether prevailing wages had been paid to H-1B workers. Although the ALJ ordered reinstatement, back pay, relocation expenses for one of the Complainants, and expungement of a retaliatory proficiency report in one of the Complainant's personnel files, she declined to impose civil penalties and debarment from participation in the H-1B LCA program where the Respondent was a VA medical center. The ALJ stated: "...I conclude that these remedies are inappropriate against this Respondent, a publicly funded veterans' medical center with chronic budget struggles, which needs H-1B physicians to provide care for its patients."
REINSTATEMENT; FACILITY AT WHICH OFFER MUST BE MADE; REJECTION OF OFFER TERMINATES BACK PAY LIABILITY
In Talukdar v. U.S. Dept. of Veterans Affairs Medical & Regional Office Center, Fargo, ND , 2002-LCA-25 (ALJ Apr. 12, 2004), two physician-Complainants indicated a preference not to be reinstated to the same facility at which the retaliatory conduct occurred. The ALJ, however, found that the Respondent could offer reinstatement at the same facility or another mutually agreeable facility. The ALJ noted that the Complainants were free to accept or reject the offer of reinstatement, albeit back pay would terminate as of the date of a rejection of a reinstatement offer.
RETALIATION FOR COOPERATION WITH H-1B PREVAILING WAGE INVESTIGATION; PROXIMITY OF PROTECTED ACTIVITY TO ADVERSE ACTION; BUDGETARY LIMITATIONS AS PRETEXT
In Talukdar v. U.S. Dept. of Veterans Affairs Medical & Regional Office Center, Fargo, ND , 2002-LCA-25 (ALJ Apr. 12, 2004), the ALJ found that two physicians were fired from a Veterans Affairs medical center (VAMC) because they provided information to an investigator for the Department of Labor who performed an audit of VAMC's H-1B visa program in January 2001. Under the Immigration and Nationality Act, an employer seeking to hire an alien in a specialty occupation on an H-1B visa must obtain certification from the U.S. Department of Labor ("DOL") by filing a Labor Condition Application ("LCA). 8 U.S.C. § 1182(n). The DOL is responsible for investigating complaints that an employer has failed to comply with the terms of the LCA, or has failed to pay the appropriate wage rate. 8 U.S.C. § 1182(n)(2). Subsection (n)(2)(C)(iv) provides that it is a violation of the Act for an employer to discriminate against an employee who discloses information about or cooperates with an investigation of a violation of the Act's requirements. According to the regulatory history of the implementing regulations -- because the language and intent of this provision are similar to the employee protection provisions contained in the nuclear and environmental whistleblower statutes administered by DOL, the same analysis applies. 65 Fed. Reg. 80178 (2000); see Administrator v. IHS Inc. , 1993-ARN-1 (ALJ Mar. 18, 1996).
The two physician-Complainants involved were not H-1B workers themselves, but participated in advocacy on behalf of VAMC H-1B physicians in their leadership roles in the physicians' union. The ALJ found that although the H-1B advocacy extended over a period of time, the proximate events leading up to the Complainants' discharges transpired over a period of less than two months as the H-1B issue came to the forefront. The ALJ found that this proximity established a nexus between the protected activity and the adverse employment action. The ALJ found that the Respondent's proffered legitimate non-discriminatory reason -- budgetary problems -- was not credible and was a pretext for retaliation for the Complainants participation in the DOL H-1B investigation. The ALJ analyzed the Respondent's past practices vis-a-vis budgetary limitations and found that terminating the employment of physicians had never been the way in which such problems were addressed. The ALJ also rejected an additional suggestion that performance was an issue with one of the Complainants where this reason was proffered after-the-fact, and where the negative performance appraisal was inconsistent with four previous appraisals and did not match or distorted the duties assigned.
DISCOVERY; ELECTRONIC RECORDS; E-MAIL
Judge Shira A. Scheindlin of the U.S. District for the Southern District of New York issued a series of rulings in 2003 involving discovery of electronic records and e-mail in Zubulake v. UBS Warburg LLC , No. 02 Civ 1243. The Plaintiff's suit is grounded in Federal, State and City law for gender discrimination and illegal retaliation. Discovery in the case has focused on Plaintiff's contention that key evidence is located in various e-mails that now exist only on backup tapes and possibly on other archived media. Although practice under the FRCP may differ in significant respects from practice under USDOL rules, Judge Scheindlin rulings in the Zubulake case provide significant background in regard to electronic discovery generally:
Zubulake v. UBS Warburg LLC
, No. 02 Civ 1243 (SDNY May 18, 2003)
(discussion of the problem of balancing the competing needs of broad discovery and manageable costs; Defendant had declined to search back-up tapes for deleted e-mails because of the cost; accessible and inaccessible data; cost-shifting analysis -- 7 factors).
Zubulake v. UBS Warburg LLC
, No. 02 Civ 1243 (SDNY May 18, 2003) (in deposition of Defendant's electronics records manager - designated by Defendant as confidential - Plaintiff became concerned that certain of Defendant's records management practices were in violation of the SEA and SEC rules and requested leave to report her concerns on the ground that, as a licensed broker, she has an ethical obligation to report such matters; the court, however, found that Plaintiff had not established a clear duty to report and that an apparent attempt to gain leverage in the law suit was an improper motive and not grounds for removing the confidential designation).
Zubulake v. UBS Warburg LLC
, No. 02 Civ 1243 (SDNY July 24, 2003)
(application of cost-shifting analysis following sample restoration of subgroup of backup tapes).
- Zubulake v. UBS Warburg LLC , No. 02 Civ 1243 (SDNY Oct. 22, 2003) (available at 2003 WL 22410619) (consideration of sanctions for failure to preserve electronic records; trigger date for duty to preserve attaches at the time that litigation becomes reasonably anticipated; scope of preservation of relevant documents; whose documents must be retained; what must be retained; elements to establish entitlement to adverse inference instruction -- obligation to preserve, culpable state of mind, relevance of destroyed documents).
ADVERSE EMPLOYMENT ACTION; REQUIREMENT OF A MATERIALLY ADVERSE CHANGE IN TERMS OF EMPLOYMENT
In a Title VII action, White v. Burlington Northern & Santa Fe Railway Co. , 2004 Fed. App. 0101P (6th Cir. Apr. 14, 2004), the Sixth Circuit reviewed that circuit's law on the meaning of an "adverse employment action." The court stated that Kocsis v. Multi-Care Management Inc. , 97 F.3d 876 (6th Cir. 1996), is the seminal case in the 6th Circuit for defining adverse employment action. The court wrote:
In Kocsis v. Multi-Care Management Inc. , this court considered the definition of adverse employment action in the context of a discrimination claim under the Americans with Disabilities Act. 97 F.3d 876, 885-87. Relying in part upon the Seventh Circuit's definition, this court held that a plaintiff claiming employment discrimination must show that she suffered "a materially adverse change in the terms of her employment." Id. at 885 (citing Spring v. Sheboygan Area Sch. Dist. , 865 F.2d 883 (7th Cir. 1989), which involved an age discrimination claim). A "mere inconvenience or an alteration of job responsibilities" or a "bruised ego" is not enough to constitute an adverse employment action. Id. at 886 (citing Crady v. Liberty Nat'l Bank and Trust Co. , 993 F.2d 132, 136 (7th Cir. 1993), and Flaherty v. Gas Research Inst. , 31 F.3d 451, 456 (7th Cir. 1994)).
Furthermore, according to Kocsis , "reassignments without salary or work hour changes do not ordinarily constitute adverse employment decisions in employment discrimination claims." Id. at 885 (citing Yates , 819 F.2d at 638, which applied to "temporary" reassignments). A reassignment without salary or work hour changes, however, may be an adverse employment action if it constitutes a demotion evidenced by "a less distinguished title, a material loss of benefits, significantly diminished material responsibilities, or other indices that might be unique to a particular situation." Id. at 886 (citing Crady , 993 F.2d at 136).
In White , the Plaintiff and the EEOC as amicus argued that the court should revise its definition to adopt the EEOC interpretation that "adverse employment action" in the context of a Title VII retaliation claim means "any adverse treatment that is based on a retaliatory motive and is reasonably likely to deter a charging party or others from engaging in protected activity." The court, however, concluded that its definition accomplishes the purpose to Title VII's anti-retaliation provision while also balancing "the need to prevent lawsuits based on trivialities." The court therefore re-affirmed the definition developed in Kocsis and similar 6th Circuit decisions.
In considering whether a suspension without pay followed by reinstatement with back pay is an adverse employment action, however, the 6th Circuit rejected an earlier decision suggesting that it would follow the Page v. Bolger , 645 F.2d 227, 233 (4th Cir. 1981) "ultimate employment decision" rationale.
[Nuclear and Environmental Whistleblower Digest XIII A]
[STAA Whistleblower Digest VI A]
ADVERSE EMPLOYMENT ACTION; TANGIBLE JOB DETRIMENT
In Hillig v. Rumsfeld , No. 02-1102 (10th Cir. Aug. 27, 2004), a Title VII case, the 10th Circuit held that any act that causes more than de minimis impact on a plaintiff's future employment opportunities may be actionable as retaliation. The court specifically disagreed with the district court's that an "adverse employment action," under Title VII, may be only those employment actions that result in "tangible harm" to the plaintiff. The court noted that there was split in the circuits on this issue.
[Nuclear and Environmental Whistleblower Digest IX M 2]
ATTORNEY MISCONDUCT; JURISDICTION OF ARB TO REVIEW SECTION 18.34(g)(3) SUSPENSION ORDER; DE NOVO REVIEW OF PROCEDURE AND FACTUAL AND LEGAL CONCLUSIONS RELATING TO ISSUE OF WHETHER THERE HAD BEEN MISCONDUCT; ABUSE OF DISCRETION REVIEW OF CHOICE OF SANCTION [staa>
In Edward A. Slavin, Jr. , ARB No. 04-088, ALJ No. 2004-MIS-2 (ARB Apr. 29, 2005), the Associate Chief ALJ had suspended an attorney from practice before OALJ under 29 C.F.R. § 18.34(g)(3). The attorney and his client appealed to the ARB, which found that it had jurisdiction to review the section 18.34(g)(3) suspension because it occurred in relation to whistleblower proceedings over which the Secretary had delegated the responsibility to review the recommended decisions of ALJs. Because the conduct occurred in different types of cases in which the type of review conducted by the ARB varied, the ARB concluded that it would use the most comprehensive level of review -- i.e., de novo review -- of the procedure that the Associate Chief ALJ had followed for compliance with due process guidelines, and his factual findings and legal conclusions regarding the instances of misconduct. The Board, however, applied an abuse of discretion standard to the Associate Chief ALJ's choice of sanction.
[Nuclear and Environmental Whistleblower Digest IX M 2]
[STAA Whistleblower Digest II M]
ATTORNEY MISCONDUCT; ROLE OF THE OFFICE OF THE SOLICITOR IS TO REPRESENT THE DEPARTMENT'S INTERESTS
In Edward A. Slavin, Jr. , ARB No. 04-088, ALJ No. 2004-MIS-2 (ARB Apr. 29, 2005), the Associate Chief ALJ had suspended an attorney from practice before OALJ under 29 C.F.R. § 18.34(g)(3). On appeal, the Solicitor of Labor had filed an amicus brief on behalf of the Assistant Secretary for OSHA in support of the suspension. The attorney and his client filed a motion to disqualify the Solicitor as the Assistant Secretary's representative. The ARB denied the motion noting, inter alia, that "the Solicitor's representation of the Assistant Secretary in this appeal from [the Associate Chief ALJ's] disqualification of Mr. Slavin pursuant to Section 18.34(g)(3) accords with the Secretary's directive in Rex v. Ebasco Servs. that the Solicitor represent the Department's interests in attorney disqualification proceedings. Rex, No. 87-ERA-6, slip op. at 4 (Sec'y Oct. 3, 1994)."
[Nuclear and Environmental Whistleblower Digest IX M 2]
[STAA Whistleblower Digest II M]
ATTORNEY MISCONDUCT; 29 C.F.R. § 18.34(g)(3) PERMITS A BAR OF AN ATTORNEY FROM APPEARING IN FUTURE CASES
In Edward A. Slavin, Jr. , ARB No. 04-088, ALJ No. 2004-MIS-2 (ARB Apr. 29, 2005), the Associate Chief ALJ had suspended an attorney from practice before OALJ under 29 C.F.R. § 18.34(g)(3). On appeal, the attorney and his client argued that § 18.34(g)(3) does not authorize entry of an order barring a representative from appearing in future cases. The ARB rejected this argument based on In re Edward A. Slavin, Jr., ARB No. 02-109, ALJ No. 2002-SWD-1 (ARB June 30, 2003) (distinction between 18.34(g)(3) and 18.36 proceedings) and Rex v. Ebasco Servs., 1987-ERA-6 and 40 (Sec'y Oct. 3, 1994) (Secretary's order agreeing to conduct a single proceeding to resolve question of attorneys' conduct rather than serial proceedings before each ALJ before which those attorneys appeared).
[Nuclear and Environmental Whistleblower Digest IX M 2]
[STAA Whistleblower Digest II M]
ATTORNEY MISCONDUCT; WHAT CONSTITUTES ADEQUATE DUE PROCESS UNDER SECTION 18.34(g)(3)
In Edward A. Slavin, Jr. , ARB No. 04-088, ALJ No. 2004-MIS-2 (ARB Apr. 29, 2005), the Associate Chief ALJ had suspended an attorney from practice before OALJ under 29 C.F.R. § 18.34(g)(3). On appeal, the ARB considered whether this procedure complied with due process safeguards as interpreted within the context of attorney disciplinary proceedings.
The Board observed that section 18.34(g)(3) does not delineate a step-by-step process for rendering a determination. The Board carefully examined the Associate Chief ALJ's procedure and found that it comported with due process. Specifically, the ALJ's Notice of the Judicial Inquiry clearly identified the evidentiary basis for the section 18.34(g)(3) inquiry and the types of professional misconduct that were at issue. The Board found that the Notice also explained the procedure that would be followed and the means by which the attorney could defend against the charges, including the prerequisites for the scheduling of an evidentiary hearing. The ARB observed that because of the lack of detail in section 18.34(g)(3), it had been especially important to provide this information to the attorney. Finally the Board found that the Notice unambiguously advised the attorney of the consequences of a failure to timely respond, a failure to meet the prerequisites for an evidentiary hearing, and a failure to successfully defend against the charges.
[Nuclear and Environmental Whistleblower Digest IX M 2]
[STAA Whistleblower Digest II M]
ATTORNEY MISCONDUCT; ORAL, EVIDENTIARY HEARING NOT REQUIRED IF ATTORNEY FAILS TO PRESENT THE EXISTENCE OF A GENUINE ISSUE OF MATERIAL FACT; PRIOR JUDICIAL RULINGS ON MISCONDUCT AS EVIDENCE
In Edward A. Slavin, Jr. , ARB No. 04-088, ALJ No. 2004-MIS-2 (ARB Apr. 29, 2005), the Associate Chief ALJ had suspended an attorney from practice before OALJ under 29 C.F.R. § 18.34(g)(3). In the Notice of Judicial Inquiry, the judge had informed the attorney of the charges, which were based on holdings of DOL ALJs, the ARB, and state and federal courts in prior proceedings. The judge explained the procedure that would be followed. The judge instructed, inter alia, that the attorney needed to present a genuine issue of material fact on the charges in order for an oral, evidentiary hearing to be convened, noting that in the prior cases the attorney had not denied that he had engaged in the conduct cited by the presiding officers but rather had typically defended based on First Amendment and justification defenses. The judge also informed the attorney that he would not be permitted to re-litigate any matter that he had been afforded a full and fair opportunity to contest in the case in which the misconduct occurred. When the attorney, in his response to the Notice, did not identify any evidence to present on any fact issues, the judge decided the case on the existing record without first convening an oral, evidentiary hearing.
On appeal the attorney and his client argued that the judge erred by failing to conduct an oral hearing. The Board, however, found that the Associate Chief ALJ's application of threshold requirements before such a hearing would be scheduled was "consistent with the procedural safeguards afforded an attorney who is the subject of a disciplinary proceeding. Cf. In re Keiler, 316 NLRB 763, 764-66 (1995) (discussing basic due process safeguards provided attorneys in disciplinary proceedings and by the agency's procedural rules, and concluding that attorney's response to the Board's show cause order failed to demonstrate a basis for an "oral or trial-type hearing"). The Board also found no error in informing the attorney that he would not be allowed to re-litigate matters in which he had been afforded an opportunity to challenge in the prior proceedings, noting that this was consistent with principles of issue preclusion, and that the Associate Chief ALJ had reviewed the "factual circumstances" evidenced by the court documents that were properly in the record. Moreover, the Board stated that "court or agency generated documents, including decisions and orders, that address an attorney's questionable conduct in a particular case may provide competent evidence in a later disciplinary proceeding regarding whether the attorney engaged in such conduct." (citations omitted).
[Nuclear and Environmental Whistleblower Digest IX M 2]
[STAA Whistleblower Digest II M]
ATTORNEY MISCONDUCT BEFORE OALJ; PREPONDERANCE OF THE EVIDENCE STANDARD OF PROOF
In Edward A. Slavin, Jr. , ARB No. 04-088, ALJ No. 2004-MIS-2 (ARB Apr. 29, 2005), the Associate Chief ALJ suspended an attorney from practice before OALJ under 29 C.F.R. § 18.34(g)(3), finding that documents from the official records of federal courts, state courts and DOL administrative proceedings provided "clear and convincing" evidence of misconduct. In an amicus brief on appeal, the Assistant Secretary for OSHA argued that the judge need not have applied a "clear and convincing" standard of proof, but should have used a preponderance of the evidence standard. The ARB agreed that the Secretary of Labor's decision in Rex v. Ebasco Servs . 1987-ERA-6 (Sec'y Oct. 3, 1994), provides for a preponderance of the evidence standard of proof in attorney misconduct cases before OALJ, but also agreed with the judge that the documentation provided such clear and convincing evidence, thus obviating any need to review the evidence under a lower standard.
[Nuclear and Environmental Whistleblower Digest IX M 2]
[STAA Whistleblower Digest II M]
ATTORNEY MISCONDUCT; USE OF ABA MODEL RULES OF PROFESSIONAL CONDUCT TO DETERMINE WHETHER THERE WAS MISCONDUCT AND THE ABA STANDARDS FOR LAWYER DISCIPLINE AND DISABILITY PROCEEDINGS TO DETERMINE THE SANCTION
In Edward A. Slavin, Jr. , ARB No. 04-088, ALJ No. 2004-MIS-2 (ARB Apr. 29, 2005), the Associate Chief ALJ suspended an attorney from practice before OALJ under 29 C.F.R. § 18.34(g)(3). The ARB found that the judge properly used the Model Rules of Professional Conduct in considering whether the attorney's conduct was improper. In addition, the Board found that the judge did not abuse his discretion in relying on the ABA Standards for Lawyer Discipline and Disability Proceedings (1992) to determine the time period for which the Section 18.34(g)(3) bar should be imposed.
[Nuclear and Environmental Whistleblower Digest IX M 2]
[STAA Whistleblower Digest II M]
ATTORNEY MISCONDUCT; FIRST AMENDMENT CONSTRAINED WHEN FILING DOCUMENTS OR OTHERWISE COMMUNICATING WITH A COURT
In Edward A. Slavin, Jr. , ARB No. 04-088, ALJ No. 2004-MIS-2 (ARB Apr. 29, 2005), the Associate Chief ALJ suspended an attorney from practice before OALJ under 29 C.F.R. § 18.34(g)(3). The attorney's chief defense was that his conduct was protected under the First Amendment. On review, the ARB agreed with the judge that much of the conduct for which the attorney was being suspended, like failing to file pleadings in a timely manner, with proper information and in the required format, could not reasonably be construed as speech protected by the First Amendment. The ARB also found that the judge properly concluded that the attorney's speech-based misconduct was subject to the constraints imposed on the language used by attorneys when filing documents with or otherwise communicating with a court, and thereby properly rejected the attorney's contention that the Section 18.34(g)(3) proceeding had been undertaken as retaliation for the attorney's exercise of his First Amendment rights through public criticism of the DOL whistleblower program. The ARB's decision includes several pages of discussion of the balance between protecting the integrity of the adjudicative process and the First Amendment.
[Nuclear and Environmental Whistleblower Digest IX M 2]
[STAA Whistleblower Digest II M]
ATTORNEY MISCONDUCT; FIVE YEAR DISQUALIFICATION APPROPRIATE WHERE THE ATTORNEY ENGAGED IN CONDUCT THAT BREACHED DUTIES TO HIS CLIENTS AND THE LEGAL SYSTEM AND WHERE THERE WERE NO MITIGATING CIRCUMSTANCES BUT A NUMBER OF AGGRAVATING FACTORS
In Edward A. Slavin, Jr. , ARB No. 04-088, ALJ No. 2004-MIS-2 (ARB Apr. 29, 2005), the Associate Chief ALJ suspended an attorney from practice before OALJ under 29 C.F.R. § 18.34(g)(3) for an indefinite period of no less than five years. The ARB, employing an abuse of discretion standard of review in regard to the choice of sanction, found that the judge properly relied on the ABA Standards for Lawyer Discipline and Disability Proceedings (1992) to determine the time period for the sanction, that the judge carefully followed the comprehensive formula that the ABA standards provide, thoroughly explained his conclusions that the attorney had breached duties to his clients and to the legal system, and had explained his findings that there were no factors that weigh against imposing a severe sanction and that there were a number of aggravating factors that provide further support for the sanction. The Board therefore affirmed the five year disqualification.