Wrongful Termination Plaintiffs Permitted to Testify as Their Own Experts
How would you like to be the employer in this case?
Two police officers at the University of Texas Medical Branch (UTMB) refused to arrest a patient, saying there was no probable cause and the arrest would therefore be illegal. They were shown the door, and now are suing for wrongful termination.
Firing an employee for refusing to break the law is a violation of public policy, and therefore is a wrongful termination. Thus, this entire case will come down to whether it would have been unlawful for the officers to make the arrest, an issue that might be open to the testimony of an expert witness who can explain the law of probable cause.
So, the time came in the case to designate the expert witnesses, and the plaintiffs designated themselves! Counsel for UTMB screamed, claiming that the judge was the best person to decide the issue of probable cause. Besides, counsel argued, the officers had not provided resumes or articles published in legal journals to show their expertise.
Silly counsel, resumes are for . . . well that doesn't really work. But the standard for an expert is not nearly as high as what you argued. There is no requirement that a person be published or have a curriculum vitae in order to be an expert. He need only show that the has sufficient knowledge of a subject to be able to offer an opinion that would be helpful to the jurors. Seems to me that police officers with training and years of experience would be able to provide meaningful testimony as to what constitutes probable cause.
The judge denied the request to exclude the expert testimony of the officers. A more detailed article about the case can be found here.
This is the flip side of the coin I wrote about in Don't Bet Your Job on Whether You're Right. In that case, a City employee decided that depositing a certain check would be illegal, and refused to do so on that basis. She lost her wrongful termination case, because the judge decided it would not have been illegal to deposit the check.
Video Shows A New Way Terminations May Haunt Employers
"Pregnancy Discrimination" -- one of my firm's practice areas -- popped up in my Google Alerts, and the link took me the the YouTube video below. The video is of a visibly pregnant woman, complaining about how she suffered job discrimination at work due to her pregnancy. People using YouTube videos to vent is nothing new, relatively speaking, but I found this video interesting for a couple of reasons.
First was the fact that it came up so readily in a search. A Google search for "pregnancy discrimination" yields 1,520,000 hits. The video was posted on January 9, 2012, and five days later I was seeing it in my Google Alerts. Thus, employers need to know that even a modest effort as in the case of this video could quickly put a business in a negative light.
The second point of note is how persuasive it is because of the calm manner it was presented. The woman, who identifies herself only as "Angel", is not screaming or making outrageous claims; she just sets forth the facts like she is making a closing argument at trial.
In this case, the employer will probably receive little if any backlash. The audio is pretty poor (Angel, the most important part of a video is the AUDIO!), it has fewer than 100 hits at the time I am writing this, and I don't believe she ever identifies the employer, only her union. Nonetheless, the video offers a valuable lesson.
An employer always ran the risk that a termination would result in a lawsuit, but could minimize the chances of a successful suit by making certain all laws were followed AND that the termination did not have the appearance of impropriety. That second element is now especially important, because even if the employer can prevail in civil court, it might still be found guilty in the court of public opinion, with a concomitant impact on the bottom line.
Most Hated Corporate Buzzwords
CareerBuilder.com did a poll to determine the most reviled corporate buzzwords. Incredibly people are still uttering "outside the box", which is the most hated term by 31 percent of the respondents.
The rest of the list:
- Low-hanging fruit (24 percent)
- Synergy (23 percent)
- Loop me in (22 percent)
- Best of breed (19 percent)
- Incentivize (19 percent)
- Mission-critical (19 percent)
- Bring to the table (18 percent)
- Value-add (17 percent)
- Elevator pitch (16 percent)
- Actionable items (15 percent)
- Proactive (15 percent)
- Circle back (13 percent)
- Bandwidth (13 percent)
- High level (10 percent)
- Learnings (9 percent)
- Next steps (6 percent)
So what is the importance of this list to you? Just know that if you choose to bring these cliches to the table, you might incentivize others to circle back on you.
Cell Phone Law Could Spell Trouble for Employers
My business partner Deanna Stone wrote an excellent article back in 2008 about how the (then) new hands free cell phone law could expose employers to liability if a worker, on company business, caused an accident while in violation of the law. Now we get news that the National Transportation Safety Board wants a law passed that will ban any cell phone use while driving*, hands free or not. Ms. Stone's advice was good then and is good now. As she said:
Taking these simple precautions can reduce an employer’s potential liability for damages relating to employee violations of the new law:
(1) Draft and distribute a clear policy on the new law in employee handbooks, and have your employees sign an acknowledgment of receipt of the new policy or new handbook incorporating such policy.
(2) When issuing a cell phone to new employees, provide a copy of the new law, the company’s policy on such law, and again have the employee sign an acknowledgment of receipt of such material.
(3) Have a training class for all employees on the new law, the company’s new policy requiring employee compliance with said law when using the company cell phone or their own personal cell phone if used to conduct company business.
(4) Provide or post information on the new law and your new company policy in the office kitchen, break room or other public areas in your office.
(5) Inform employees that they company will not foot the cost for violations of the new law, and that they will be personally liable if they choose to violate the new law.
(6) Create a disciplinary policy for any employee who violates the new law, which ultimately can lead to the termination of the violating employee.
(7) If you employ minors, you should taken even greater precautions with such employees especially if their job duties include driving for work purposes. It is a great temptation to a teenager to simply text a friend while driving, and this is a violation of the new cell phone law.
Yes, it's crazy** that the Feds feel compelled to be so ridiculously paternal, and that we need to jump through these hoops as a result, but we're here to keep you off the path of liability.
* I happened to see a reported case from another state that interpreted a statute that made it illegal to text and drive. While stopped at a stop light, the defendant fired off a quick text message and got a traffic ticket for the dastardly deed. He took it all the way to the Court of Appeal, which agreed with the trial court that sitting at a stop light is still "driving".
** Why do I see this as crazy? Because we only need a law that makes it illegal to perform an act that distracts from driving. If you are reading a newspaper while driving, you deserve a ticket and we don't need a law that singles out newspaper reading. How is talking hands free while driving any more distracting than, say, singing along to "Freebird" (which necessitates a lot of head nodding and air guitar), yet we don't have a no Freebird law (yet).
Morris & Stone Gets Triple Damages and Attorney Fees for Fraud
When is a breach of contract also fraud? When the party never intended to perform.
When do you get triple damages and all of your attorney fees for fraud? When you hire Morris & Stone (although your results could differ).
Breach of contract is easy to spot, but business owners are often confused about what constitutes fraud. Someone fails to pay all the money owed on an invoice, and the client wants us to add a cause of action for fraud. That's probably not fraud.
The elements of fraud are (1) a misrepresentation of a material fact; (2) made with the intention that the party rely on that representation to his detriment; (3) reasonable reliance on the misrepresentation; and (4) damages. As you can see from the above elements, in the case of a contract, for there to be fraud the fraudulent intent must exist at the time of the contract. If a person enters into a contract intending to perform, if he later fails to perform, that breach will not transmute into fraud no matter now egregious and flagrant his breach. To prove fraud, you must show that at the time the defendant entered into the agreement, he had no intention of performing.
So how do you get into the mind of the defendant to determine if he intended to perform when he signed the agreement? Thankfully, California courts have held that the behavior after the contract was signed can be used to show that the defendant never intended to perform. In our case, the defendant borrowed a significant amount of money from our client, and pursuant to the agreement that money was to be invested in a business venture. The money was never repaid, and our client hired us to recovery the money.
We went her one better. We sued for fraud, because we could see no indication that the money ever went into the business venture. We felt that would be sufficient to show that at the time of the contract the defendant did not intend to perform. He was free to argue that he intended to invest the money at the time of the contract and therefore it was not fraud, but how would he explain that the money was never used for the intended purpose? As we suspected, defendant fought us on discovery, and when we compelled him to respond, he could not provide any proof that the money had ever gone to the business.
But here is where we got really creative. There is a criminal code section that makes it illegal to receive stolen property, and allows a victim to bring a civil action against the criminal to recover three times the value of the stolen property. We sued under that section, alleging that the entire loan process had just been a artifice to relief our client of her money. In other words, he stole the money from our client through a bogus business venture, and kept that money for himself. It was no different than if he had stolen the money by hacking into her checking account. The fact that he used loan documents to steal the money did not make it any less of a theft.
A fact pattern that will support this breach of contract/fraud/theft approach does not arise very often, but we have tried it twice before. In both of the prior actions, we won on the breach of contract and fraud causes of action, but could not get the judge to consider the theft cause of action. The theft cause of action provides a real conceptual hurdle for most judges. Many judges are former District Attorneys or Public Defenders, and their criminal law backgrounds taught them that a criminal cannot be convicted of both stealing property and receiving that property. Yet, here I am arguing to them that I want damages under a statute dealing with receiving stolen goods even though this is the same person that stole the goods (here, the money). In reality, the law says that someone cannot be convicted of both offenses, but can be charged with either. Indeed, the law says that if the statute of limitations has passed for the theft of the goods, the thief can still be charged with receiving the property, because the statute actually states that it is an offense to receive or exercise control over the stolen property. Thus, the same person that steals the property is guilty of exercising control over it if it still has not been returned.
The second conceptual hurdle involves the erroneous concept that the defendant must have been convicted of the offense before the civil suit can take place. After all, the judges reason, the legal standard for the burden of proof on a criminal conviction is beyond a reasonable doubt, whereas in civil court it is just more probable than not. How can a defendant be made to pay under a criminal statute when he has never been convicted of the offense? Complicating the matter, no reported decision has ever discussed the civil remedies under the criminal statute upon which we were relying.
In reality, these concerns are easily disposed of, but the judge must be made to wrap his mind around the concept. In the latter case, no criminal conviction is necessary because it still must be shown in the civil action that the defendant committed the offense. Other cases involving civil enforcement of criminal statutes have made clear that the primary reason the statutes provide for a civil remedy is that law enforcement does not always have the will or resources to go after a criminal. A victim of a crime should not be dependant on the vagaries of the criminal system in order to seek redress. For example, there is a statute that permits cable companies to seek civil damages for the theft of a cable signal. What are the odds that police departments around the state are going to devote resources to going after cable thieves? Therefore, the Court of Appeal held that cable companies can prosecute under these criminal statutes whether or not the defendant has ever been criminally charged. It's a win-win. The cable company can become its own police force in order to discourage cable thieves, and the government need not devote resources to that purpose.
So it is here. There would be little disincentive to using false pretenses to "borrow" money if the worst that could happen to the defendant was that he would someday be ordered to return the money. Morris & Stone uses this criminal statute to impose a quasi-criminal remedy on the defendant, providing a much greater disincentive regarding this type of fraud, since the defendant must pay back three times the amount he took.
This judge finally got it, and tripled the damages, awarding our client three times what she had loaned to the defendant. As a huge bonus, the statute provides that the defendant must pay all attorney fees incurred by the plaintiff. Absent a contract provision, you are not entitled to recover attorney fees under a breach of contract case, and rarely under a fraud claim. Since we used this criminal statute, the court also awarded our client her attorney fees.
We might just start wearing badges.
Target Pays $160,000 Settlement for Failing to Accommodate
Target Corp. has agreed to pay $160,000 to settle federal allegations that it discriminated against an employee with cerebral palsy. The case was brought by the U.S. Equal Employment Opportunity Commission, which alleged that Target had cut the hours of Jeremy Schott, an employee of an Orange County, California Target, and that Target had failed to make reasonable accommodations for Schott's disability.
According to court records, Schott was originally hired int 2002 at a part-time stocker and later worked as a cart attendant. Schott's cerebral palsy caused a seizure disorder and some cognitive difficulties, but it was alleged that he could perform all of his job duties with the help of a coach.
Schott performed his job well, and even received an award for his work performance. However, in 2004, after he took a medical leave following a seizure, Target reduced his hours to as little as eight hours per week. The EEOC also alleged that the company failed to ensure Schott's parents or job coach were present during performance reviews and other work meetings. Perhaps most damning of all, the EEOC asserted that Target had failed to engage in any meaningful discussions with Schott regarding possible accommodations.
Under the settlement, Target agreed to pay Schott $5,000 in lost wages and $155,000 in compensation for emotional pain and suffering.
Lesson for all businesses: Employers sometimes attempt to justify termination of a disabled employee without any meaningful accommodation discussion by arguing that the terminated employee never requested it. United Airlines, the airline that breaks guitars, made such an argument. As United Airlines learned, that argument will not fly with California courts.
The Second District Court of Appeals held that the law does not require an employee to somehow "invoke" the protections of the law; they are already there. If the employer knows or should have known that the disability existed, it is the employer's duty to open the dialog for reasonable accommodation.
Sometimes an employee will deny being disabled, until he is terminated for poor job performance and then claims it was disability discrimination. In that case, an employer might find some protection. The court ruled that an employer has no duty to accommodate an employee who denies having a disability. Prillman v. United Air Lines, Inc. (1997).
Class Action Against Twitter Shows Need to Act Paranoid
In a recent T-Mobile commercial, in explaining why you pay more for slower Internet access, a character playing the part of an attorney says, "It makes sense if you don’t think about it too much." That will apparently be the argument made by the California attorney that filed a recent class action against Twitter.
Here is how this fight for justice came about. Twitter, like many other services, allows users to opt-in to text notifications. For example, let’s say you were new to Twitter, and you wanted to receive a notification whenever someone sent you a direct tweet. You can instruct Twitter to send a text to your cell phone each time you are tweeted. Then let’s say that you enjoyed these notifications for a few months, but soon you became so popular that your phone was dinging like the bells of Westminster Abbey with notifications of incoming messages.
No problem. Twitter makes it easy to turn off the notifications. Rather than to make you go on-line and make the change, or even to drill down through the notification settings on your phone, all you need to do is respond to one of these text notifications with the word "stop". Twitter politely and efficiently responds with a test message notifying you that your message was received, and never again do you receive anymore text notifications from Twitter, unless and until you turn them back on.
So how could any attorney find fault in this perfect system? Well according to the allegations of the complaint, this process violates the Telephone Consumer Protection Act ("TCPA"). You see, in order to prevent consumers from receiving spam text messages, the TCPA makes it illegal to send text messages unless they were authorized by the recipients. According to the lawsuit, although the messages were authorized by the initial opt-in, when the word "stop" was sent, that removed any authorization. Therefore, the text acknowledging that you would not be receiving any more text messages was not authorized, even though by sending "stop" you are seeking a response by Twitter and any rational person would appreciate confirmation of the request. It makes sense if you don’t think about it too much.
Lesson for all businesses: California is the class action capital of the country. When deciding if something you are doing or contemplating could get you in trouble, don’t just run it through rational thought, but imagine also that there are attorneys out there with no scruples, that will view the conduct in irrational ways in order to cobble together an action against you. (See my prior article on the attorneys that brought a class action because there were no crunch berries in Captain Crunch.)
Does this mean you must bow to the threat of legal action? Not at all. Text notifications are too important to the expansion of Twitter to forego, but with a little tweaking this frivolous action could have been made even more frivolous, perhaps even to the point that it would never have been pursued. Twitter could have added a few words to its terms of use, explaining that a confirming message would be sent in response to the opt-out request. Yes, that is not something that should need explaining, but with that additional clarification the user would have been authorizing the final message, and Twitter would not need to deal with this ridiculous suit.
Be Ever Vigilent to Avoid Disablity Discrimination Claims
The calls to our office involving claims for disability discrimination seem to be rising exponentially, and a recent report by the Equal Employment Opportunity Commission explains why.
The EEOC reports that one-quarter of all the discrimination complaints filed with the agency in 2010 involved disability discrimination claims. There are probably many factors involved in that statistic, but I suspect a major factor is the willingness of plaintiffs’ attorneys to pursue such claims. Discrimination claims based on age, for example, can be hard to prove. If age is truly the motivation behind some adverse job action, it is unlikely that the employer telegraphed that fact. The proof of discrimination will need to come from a showing of disparate treatment, with little or no direct evidence that the employer had it out for older employees. But with a disabled employee, proof of discrimination can come from the failure to accommodate the disability, making the proof much easier.
The recent Supreme Court case of Roby v. McKesson Corp. illustrates the point. In that case, the plaintiff was a valued employee for more than a decade, but began taking medicine to deal with some stress issues. That medicine apparently came with some side-effects, including body odor and open sores cause by her scratching herself. She was sometimes unable to go to work, but she could not always comply with the company’s requirement of 24 hours notice (and, frankly, how often does any employee know 24 hours in advance that he or she is going to be sick?). Add to this, the supervisor was alleged to have berated her at meetings about her condition. She sued and obtained a judgment for $20 million, although it was subsequently reduced to $4 million.
In another case, Sandell v. Taylor-Listig, Inc., an employee suffered a stroke, resulting in his use of a cane and slowed speech. The company eventually terminated him, and he sued for discrimination. The trial court threw out the case on a motion for summary judgment, but that ruling was reversed on appeal, finding that while the company had claimed the termination was for poor performance, there was sufficient evidence to let a jury decide whether that claim was a pretext.
Lesson for businesses: The definition of what constitutes a disability is very broad. If you have an employee claiming some condition that is limiting their ability to work or which needs some special accommodation, listen. You have an affirmative duty to engage the employee in a good-faith dialogue to determine what can be done to accommodate the condition, even if the employee never makes such a request.
Is Sexual Harassment Ever Permissible in the Workplace?
Back in the days before the term "hostile work environment" had yet been coined, a valid claim of sexual harassment usually required that a supervisor was using his position to seek sexual favors from a subordinate. Then it evolved that the perpetrator did not need to be a supervisor, but sexual harassment could exist when the company failed to protect an employee from improper harassment, even at the hands of peers. And then finally it came to be that the perpetrators did not even need to be employees; even customers or others could create a hostile work environment.
But how do the courts handle it when, from all indications, a hostile work environment is seemingly an inherent part of the job? How would that ever arise, you ask? Well, the most famous case in this regard is Lyle v. Warner Bros. Television Prods. In that case, the plaintiff was a writer’s assistant on the "Friends" television show. She took exception to the sexually charged nature of the writing and production process, which included meetings that were fraught with sexual comments and innuendos, often demeaning to women. She lost her action after the court determined as a matter of law that a show about sex and other adult themes could not be written without reference to and meetings about sex and other adult themes.
Some thought Lyle would be the first of many cases to recognize that a hostile work environment is unavoidable in some industries. For example, can a female prison guard claim hostile work environment because the prisoners are always peppering her with sexual comments? Well, funny you should ask because that is the precise situation that arose in Freitag v. Ayers. There, a prison guard at Pelican Bay state prison finally had enough and sued based on a hostile work environment. The prison thought it had an out with the Lyle reasoning, since prisoners will be prisoners and the prison cannot control their behavior. But the court disagreed, and held that even where the harassment is likely to occur, the employer must take reasonable steps to end the harassment. The facts of Lyle were very specific, and if a prison is required to shield female guards from mouthy prisoners, then there will be few circumstances where a hostile work environment will be found to be a necessary evil.
Lesson for all businesses: The duty to protect from a hostile work environment goes far beyond protecting employees from supervisors. Businesses must provide a shield from all people the employee comes in contact with, whether it be other employees, customers or vendors.
Retaliation Claims Can Extend Beyond the Employee
I have always made this claim, but the Supreme Court finally agreed with me.
Title VII makes it illegal for an employer to retaliate against an employee who has filed a discrimination claim. But what if an employer is genuinely evil, and knowing that attacking the employee would be obvious retaliation, instead seeks to put that employee in her place by demoting a spouse or firing a friend? Can that other person also invoke the protections of Title VII, arguing that even though he did not file the complaint, he is protected from retaliation?
That is the situation that allegedly arose in Thompson v. North American Stainless. Miriam Regalado, a female employee, filed a sex discrimination claim, and three weeks later, according to the suit, the company fired her fiancée Eric Thompson. Thompson sued under Title VII, claiming the company had fired him to retaliate against Regalado for filing her complaint.
The District Court was not impressed with the complaint, holding that Title VII did not permit this sort of third-party claims. The Court of Appeals for the 6th Circuit agreed, but the Supremes reversed.
"Thompson was an employee of NAS, and the purpose of Title VII is to protect employees from their employers' unlawful actions," he wrote. "Hurting him was the unlawful act by which the employer punished [Regalado]." In those circumstances, said Scalia, Thompson is "well within the zone of interests" protected by Title VII.
With this opinion, the Supreme Court has cleared up a split of decisions among differing districts. Third-party claims now have the green light.
Lesson for businesses: As I have preached here before, in the context of employment law, perception is reality. The reasons and motives of North American Stainless for terminating Thompson may have been perfectly appropriate, but the timing was terrible. The company created a new claim, and bolstered the original claim. The flagpole watcher approach would have been a better option.
