Westlaw Journal EMPLOYMENT Litigation News and Analysis • Legislation • Regulation • Expert Commentary VOLUME 27, ISSUE 19 / APRIL 17, 2013

COMMENTARY WHAT’S INSIDE

WRONGFUL TERMINATION 8 Nonprofit whistle-blower The federal enclave doctrine: A potentially employee nets $1.6 million retaliation award powerful defense to state employment laws Pietrowski v. Kintock Group (Pa. Ct. Com. Pl.) Joshua B. Waxman, Richard W. Black and Steven E. Kaplan of Littler Mendelson provide an overview of the federal enclave doctrine, including practical considerations HIRING PRACTICES for the employment law practitioner. 9 EBay’s ‘handshake’ deal with SEE PAGE 3 Intuit robbed workers of mobility, government says United States v. eBay DISCRIMINATION (N.D. Cal.)

ARBITRATION 10 Arbitrator had ample cause Goldman Sachs employee stuck with to dismiss discrimination suit, California court says arbitration clause barring class action Brooks v. Bechtel Corp. (Cal. Ct. App.) A Goldman Sachs managing director who agreed to submit all employment-related 11 Class arbitration case could disputes to arbitration cannot pursue a class action against the firm for Title VII be big deal for employers gender discrimination, a federal appeals court has held. Oxford Health Plans v. Sutter (U.S.) Parisi et al. v. Goldman Sachs & Co. et al., No. 11–5229–cv, 2013 WL 1149751 (2d Cir. WAGE AND HOUR Mar. 21, 2013). 12 Within a few days, Comcast puts its stamp on labor cases In granting Goldman Sachs’ interlocutory appeal, a three-judge panel of the 2nd U.S. Circuit Court FAIR LABOR STANDARDS ACT of Appeals reversed the trial court and barred 13 Concepcion spells doom for Lisa Parisi’s class action against the investment FLSA case banking giant. The trial court had refused to Muriithi v. Shuttle Express compel individual arbitration of Parisi’s claims of (4th Cir.) “pattern and practice” discrimination. REUTERS/Brendan McDermid UNIONS In its March 21 opinion, the appeals panel found 14 Judge sees no evidence of that Parisi could not circumvent the binding discrimination, which is a method of proof and a racketeering in unions’ burden-shifting tool, “not a freestanding cause of ‘corporate campaign’ arbitration agreement she signed when she joined the firm in 2003 because arbitration would action,” the court explained. Magic Laundry Servs. v. Work- ers United Serv. Employees not prevent her from “vindicating” a statutory As such, the arbitration agreement requiring Int’l Union (C.D. Cal.) right protected by Title VII. that Parisi bring her claims as an individual, not through a class action, did not deprive her of any TRADE SECRETS Writing for the panel, Circuit Judge Barrington D. Parker rejected Parisi’s argument that arbitration statutory right, Judge Parker said. In fact, both 15 Worker stole trade secrets to the courts and Congress specifically approved ‘lure away’ clients, would force her to waive her Title VII right to sue tobacco company says for pattern-or-practice discrimination, which arbitration of Title VII claims, according to the panel opinion. Republic Tobacco v. Ferraro is available only to class plaintiffs. There is no (N.D. Ill.) substantive right to sue for pattern-or-practice CONTINUED ON PAGE 16 41391538 TABLE OF CONTENTS Westlaw Journal Employment Published since May 1986 Discrimination: Parisi v. Goldman Sachs & Co. Publisher: Mary Ellen Fox Goldman Sachs employee stuck with arbitration clause barring class action (2d Cir.)...... 1 Executive Editor: Donna M. Higgins Commentary: By Joshua B. Waxman, Esq., Richard W. Black, Esq., and Steven E. Kaplan, Esq., Managing Editor Tricia Gorman Littler Mendelson [email protected] The federal enclave doctrine: A potentially powerful defense to state employment laws...... 3 Managing Desk Editor: Robert W. McSherry Wrongful Termination (Jury Verdict): Pietrowski v. Kintock Group Senior Desk Editor: Jennifer McCreary Nonprofit whistle-blower employee nets $1.6 million retaliation award (Pa. Ct. Com. Pl.)...... 8 Desk Editor: Sydney Pendleton Hiring Practices: United States v. eBay EBay’s ‘handshake’ deal with Intuit robbed workers of mobility, government says (N.D. Cal.)...... 9 Westlaw Journal Employment (ISSN 2155-594X) is published biweekly by Arbitration: Brooks v. Bechtel Corp. Thomson Reuters. Arbitrator had ample cause to dismiss discrimination suit, California court says (Cal. Ct. App.)...... 10 Thomson Reuters 175 Strafford Avenue Arbitration: Oxford Health Plans v. Sutter Building 4, Suite 140 Class arbitration case could be big deal for employers (U.S.)...... 11 Wayne, PA 19087 877-595-0449 Wage and Hour Fax: 800-220-1640 Within a few days, Comcast puts its stamp on labor cases...... 12 www.westlaw.com Customer service: 800-328-4880 Fair Labor Standards Act: Muriithi v. Shuttle Express Concepcion spells doom for FLSA case (4th Cir.)...... 13 For more information, or to subscribe, please call 800-328-9352 or visit Unions: Magic Laundry Servs. v. Workers United Serv. Employees Int’l Union west.thomson.com. Judge sees no evidence of racketeering in unions’ ‘corporate campaign’ (C.D. Cal.)...... 14

Reproduction Authorization Trade Secrets: Republic Tobacco v. Ferraro Authorization to photocopy items for internal Worker stole trade secrets to ‘lure away’ clients, tobacco company says (N.D. Ill.)...... 15 or personal use, or the internal or personal use by specific clients, is granted by Thomson Insurance: Gear Auto. v. Acceptance Indem. Ins. Co. Reuters for libraries or other users regis- 8th Circuit rejects coverage for employee’s gunfire injuries (8th Cir.)...... 16 tered with the Copyright Clearance Center (CCC) for a fee to be paid directly to the Pregnancy Discrimination Copyright Clearance Center, 222 Rosewood 2 new cases seek to clarify pregnancy discrimination laws...... 17 Drive, Danvers, MA 01923; 978-750-8400; www.copyright.com. News in Brief...... 18

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By Joshua B. Waxman, Esq., Richard W. Black, Esq., and Steven E. Kaplan, Esq. Littler Mendelson

The U.S. Constitution provides that the the United States, over which the federal federal government has exclusive legislative government has acquired exclusive rights over certain federal territories (such jurisdiction. Once the federal government as military bases, courthouses and other exerts exclusive jurisdiction over a territory, it official properties) if a state consents to the can choose whether state or federal law will purchase of the territory. These territories govern. The source of the federal enclave are known as “federal enclaves.” In practical doctrine is Article I, Section 8, clause 17 of the terms, the federal enclave doctrine provides a U.S. Constitution, which provides that: little known but potentially powerful defense Congress shall have power ... to exercise for employers that perform work in federal exclusive Legislation in all cases The U.S. Constitution provides that the federal government has enclaves because often only federal law will exclusive legislative rights over certain federal territories such as whatsoever over such district[s] ... as military bases, courthouses, and other official properties. apply in those locations. may, by cession of particular states ... The application of federal law to work become the seat of the government of then the United States and, by implication, performed in federal enclaves is significant the United States, and to exercise like a private employer working on the federal because state employment laws may give authority over all places purchased by property, does not obtain the benefits of rise to more plaintiff-friendly remedies and the consent of the Legislature of the the federal enclave doctrine. Instead, its longer statutes of limitations than their state in which the same shall be, for the possession is one of an “ordinary” proprietor, federal counterparts. Significantly, the erection of forts, magazines, arsenals, and state law will apply.6 doctrine has been recognized to preclude dockyards, and other needful buildings.1 In litigation, determining whether a federal state law wage-and-hour class actions. In Federal enclaves thus include some federal territory is a federal enclave can be a time- addition, because the doctrine gives rise 2 3 courthouses, military bases, federal intensive and fact-intensive undertaking. exclusively to federal law claims, it may form 4 5 buildings, and national forests and parks. Given the sheer volume of federal territories the basis to remove a lawsuit from state to Not all federal territories are federal enclaves. in the United States and the dearth of case federal court. In order for a territory to be considered a law addressing each territory, a party will WHAT IS A FEDERAL ENCLAVE? federal enclave, the federal government must often need to conduct this unconventional have purchased the territory “by the consent research from scratch. Such research might A federal enclave is territory, transferred of the Legislature of the state.” If it did not, include digging through old deeds or sifting by a state through cession or consent to through old court records to determine whether the federal government in fact procured the property. Moreover, a party must also locate the state statute consenting to the purchase by the United States. The source of this information can vary and can range from a deed of purchase to an opinion letter from the state’s attorney general explaining that the property at issue was ceded to the federal government and consented to by the state’s general assembly.7

HOW TO DETERMINE WHICH STATE (From L-R) Joshua B. Waxman, a shareholder at Littler Mendelson in Washington, focuses his LAWS ARE PREEMPTED practice on complex labor and employment litigation and providing strategic labor advice. He can be reached at [email protected]. Richard W. Black, a shareholder in the firm’s Washington office, is After establishing that a federal territory an experienced employment litigator who focuses on representing employers in complex employment is a federal enclave, the next question that litigation matters. He can be reached at [email protected]. Steven E. Kaplan, an associate in the firm’s Washington office, represents and counsels management clients in all areas of labor and employment must be answered is: Which state laws are law, particularly in wage-and-hour cases. He can be reached at [email protected]. preempted?

© 2013 Thomson Reuters APRIL 17, 2013 n VOLUME 27 n ISSUE 19 | 3 Legislature. Because neither the New York With respect to the first exception, neither Which state laws does the Human Rights Law nor the New York Civil the United States nor a private employer federal enclave doctrine Rights Law was enacted before July 17, 1933, can rely on the federal enclave doctrine if, preempt? the Sundaram court held that the state’s at the time of cession or purchase, the state anti-discrimination laws did not apply to expressly reserved the right to legislate the (1) A state law that was enacted the Brookhaven National Laboratories. In activity at issue within the territory. before the cession continues addition, the court held that the plaintiff’s For example, some states have reserved the to apply unless Congress two common-law claims (breach of contract states otherwise. right to legislate civil and criminal service based upon an employee handbook and a of process only,16 whereas other states have (2) A state law that was enacted tort for unlawful discharge) also did not apply reserved jurisdiction to the fullest extent after the creation of the because those claims were not recognized by possible under the Constitution.17 New York courts until well after 1933. enclave does not apply to the In Sundaram, discussed above, the plaintiff enclave. WHAT ARE THE EXCEPTIONS? argued that the New York laws in question were not preempted because, at the time There are three exceptions to the general of cession, New York reserved the right rule that a state’s law enacted after the to legislate in that territory. The deed The general rule is that: A state law that was creation of a federal enclave is preempted by memorializing the purchase by the U.S. enacted before the cession continues to apply federal law. government stated, in part: 8 unless Congress states otherwise, and a First, state law is not preempted if the state That the State of New York shall retain state law that was enacted after the creation had, at the time of cession, explicitly reserved 9 a concurrent jurisdiction with the United of the enclave does not apply to the enclave. the right to legislate over the matters at States on and over the property and As described more fully below, there are three issue.13 Second, minor regulatory changes premises so conveyed, so far as that all notable exceptions to this general rule.10 to state programs that existed at the time civil and criminal process, which may of cession are not preempted “provided the Therefore, it is necessary in this step of the issue under the laws or authority of the basic state law authorizing such control has analysis to determine the date upon which state of New York, may be executed been in effect” since the time of cession.14 the land in question became a federal thereon in the same way and manner as Finally, federal enclaves are not shielded enclave, as well as the date upon which the if such jurisdiction had not been ceded.18 state law at issue was enacted. If the alleged from state law if Congress provides “clear The court, however, rejected the plaintiff’s claim is borne from the common law, rather and unambiguous” authorization for such 15 argument, noting that the “express terms than statutory law, the same analysis will still state regulation over its federal enclaves. of the scope of concurrent jurisdiction is apply.11 extremely limited ... to the state’s right The date upon which the territory became to serve civil and criminal process on the Exceptions to the a federal enclave may be determined from property.”19 Thus, the deed did not provide general preemption rule: a deed of purchase or other court record, the state with jurisdiction to legislate other whereas traditional statutory research might (1) State law is not preempted if activities, such as antidiscrimination laws, provide the date on which the state law the state had, at the time of within the federal enclave. was enacted. If the state law was enacted cession, expressly reserved The second exception relates to state after the territory became a federal enclave, the right to legislate over the programs that were enacted prior to the date the state law will not apply. By contrast, if matters at issue. of cession of the property at issue, but which the state law was already in existence, the require ongoing regulatory changes after general rule, as noted, is that the state law (2) Minor regulatory changes to that date. will apply. state programs that existed at the time of cession are not In Paul v. United States, the U.S. Supreme The U.S. District Court for the Eastern preempted “provided the Court addressed state regulatory schemes District of New York’s decision in Sundaram basic state law authorizing regarding milk price controls that were in v. Brookhaven National Laboratories12 such control has been in place when the state ceded sovereignty over provides a good example of this principle. effect” since the time of land used for federal military installations In this case, the issue was whether New cession. but that were subject to ongoing change by York’s anti-discrimination statute applied regulators. Relying on the federal enclave to the laboratory. As a threshold matter, (3) Federal enclaves are not doctrine, the United States argued that there was no dispute that the land on which shielded from state law if California should be barred from trying to Brookhaven National Laboratories sat was a Congress provides “clear and enforce its current milk pricing regulations, federal enclave because the United States unambiguous” authorization rather than the pricing regulations in effect purchased the property from the state of for such state regulation over when the United States acquired the land in New York July 17, 1933, in a transfer signed its federal enclaves. question. by the governor and authorized by the state

4 | WESTLAW JOURNAL n EMPLOYMENT © 2013 Thomson Reuters Rejecting that argument, the Supreme jurisdiction of the state within whose enclave. The CAA is one such example.”27 Court held that changes in milk pricing exterior boundaries such place may One issue that has not been as well addressed 22 regulations would still be applicable to the be. by the federal district courts is whether federal enclave, “provided the basic state law The court held that this federal statute Congress has authorized the application of authorizing such control had been in effect provides clear authorization for state state wage-and-hour law claims in federal since the times of these various acquisitions” regulation because it gives a state official enclaves. Courts that have considered this of the land constituting the federal military charged with enforcing a state’s workers’ question are split on the issue. installations.20 The Supreme Court remanded compensation laws “the power and authority The primary issue with respect to state the case to the lower court to examine the to apply such laws to all lands and premises precise evolution of the current regulatory wage-and-hour laws is whether the Service owned or held by the United States of Contract Act contains clear and unambiguous scheme. 23 America by deed or act of cession.” congressional authorization for state wage- and-hour laws. More specifically, the issue is The federal enclave doctrine has been recognized to preclude state whether congressional intent can be inferred through the SCA’s requirement that federal law wage-and-hour class actions. contractors pay prevailing wages, including minimum wages and “fringe benefits,” which are defined to include benefits “not The third exception provides that even if The Clean Air Act24 is another example of a otherwise required by federal, state or local the state law at issue was enacted after the federal statute that expressly allows states to law to be provided by the contractor or creation of the federal enclave, Congress regulate its provision on federal properties. subcontractor.”28 may authorize such state regulation if it The CAA provides that federal facilities: provides “clear and unambiguous” assent to In Lebron Diaz v. General Security Services Shall be subject to, and comply with, 29 21 Corp., individuals employed by the the state law. What constitutes “clear and all federal, state, interstate and local defendant at a federal courthouse brought unambiguous” authorization, however, has requirements, administrative authority, a lawsuit for unpaid bonuses and sick leave been the subject of considerable debate in and process and sanctions respecting under Puerto Rico law. The employer federal district courts. the control and abatement of air contended that the courthouse was a federal Some federal statutes have been found to pollution in the same manner, and to the enclave, which precluded any claims under provide clear and unambiguous authorization same extent as any nongovernmental local law. The plaintiff countered that the for state regulation without much controversy entity. The preceding sentence shall language in the SCA constituted clear on the basis of their plain language. In apply to any requirement whether congressional intent that local regulation of Goodyear Atomic Corp. v. Miller, for example, substantive or procedural (including any employment benefits within a federal enclave the U.S. Supreme Court addressed whether recordkeeping or reporting requirement, was permissible. The U.S. District Court for Congress had authorized states to enforce any requirement respecting permits the District of Puerto Rico, observing that the their workers’ compensation laws in federal and any other requirement whatsoever) “question is admittedly close,” explained: enclaves. In particular, the statute at issue ... ; to the exercise of any federal, state provided: or local administrative authority; and While it is true that the [SCA] does not explicitly state that local laws will Whatsoever constituted authority of to any process and sanction, whether apply, no fair reading of the emphasized each of the several states is charged enforced in federal, state, or local phrases makes possible any other with the enforcement of and requiring courts, or in any other manner. This construction of the language. A compliances with the state workmen’s subsection shall apply notwithstanding message does not have to be in haec compensation laws of said states and any immunity of such agencies, officers, verba to be “clear and unambiguous.” with the enforcement of and requiring agents, or employees under any law or 25 The only reasonable interference to compliance with the orders, decisions rule of law. be drawn from the [SCA] is that local and awards of said constituted authority Indeed, courts have used the language of and state laws were to provide the of said states shall have the power and the CAA as the prototypical example of how foundation upon which the [SCA] was authority to apply such laws to all lands Congress can be “clear and unambiguous” to be built, to insure that contract and premises owned or held by the when it authorizes state regulation on employees received certain minimum United States of America by deed or act federal property. In Bouthner v. Cleveland benefits. The application of local law of cession, by purchase or otherwise, Construction Inc., for example, the District providing separate and independent which is within the exterior boundaries Court compared the clear and unambiguous employment benefits, such as the law of of any state and to all projects, language of the CAA (i.e., that state law Puerto Rico here, was unambiguously buildings, constructions, improvements, would apply to those federal facilities) to the assumed.30 and property belonging to the United Davis-Bacon Act,26 which does not contain States of America, which is within the similar language. The court noted that Other courts have been unable to find clear exterior boundaries of any state, in the “Congress is entirely capable of providing and unambiguous authorization through 31 same way and to the same extent as if explicit authorization when it intends to the SCA. In Manning v. Gold Belt Falcon, said premises were under the exclusive permit a state regulation to apply in a federal for example, the U.S. District Court for the

© 2013 Thomson Reuters APRIL 17, 2013 n VOLUME 27 n ISSUE 19 | 5 District of New Jersey held: Christmas bonus and sick leave policy REMOVAL and involved “fringe benefits,” rather than Nothing in the Service Contract Act In addition to the possible preclusion of claims for overtime. As a result, employers evinces congressional intent to apply certain state law claims, the federal enclave can persuasively argue that a plaintiff’s state minimum-wage laws to federal doctrine may also provide grounds to reliance on the Diaz decision to assert that enclaves, nor is the application of state remove a lawsuit from state to federal court the SCA provides clear and unambiguous law to federal property even mentioned. because the doctrine, if applicable, gives rise authorization for state overtime laws in Furthermore, Congress clearly enacted exclusively to federal law claims.41 the Service Contract Act for a specific federal enclaves is misplaced. Though it may be difficult to fully develop the purpose: to ensure workers employed THE FEDERAL ENCLAVE DOCTRINE factual record necessary to remove an action by federal employers were paid no IS NOT AVAILABLE TO PRIVATE from state to federal court within 30 days less than workers employed by private EMPLOYERS PERFORMING WORK IN after service of process required for removal or state employers in the same area. THE DISTRICT OF COLUMBIA under 28 U.S.C. § 1446, a party should be There is no explicit intent to abrogate able to remove cases involving the federal the federal enclave doctrine, but rather Although the District of Columbia is itself a enclave doctrine to federal court if, in its a desire to ensure protection for service federal enclave, the federal enclave doctrine notice of removal, the party can plead factual contracts.32 is not available as a shield for private allegations sufficient “to raise a right to relief employers performing work in the District. The court noted further: “The distinction above the speculative level.”42 between the statute in Goodyear and the In 1790 the District of Columbia was carved Under the federal removal statute,43 a SCA is obvious: one clearly applies state law out of Maryland and Virginia.38 In 1846, defendant need only file a notice of removal, to federal land, while the other does not.”33 however, the portions Virginia ceded were signed pursuant to Rule 11 of the Federal returned. After nearly 200 years of exclusive Relatedly, in Bouthner, the U.S. District Court Rules of Civil Procedure, containing “a short federal government control, in one form for the District of Maryland, when analyzing and plain statement of the grounds for or another, Congress enacted the District similar language under the Davis-Bacon removal.”44 The 4th Circuit has held that a of Columbia Home Rule Act in 1973.39 The Act, held that Congress did “not explicitly “district court should not hold a removing act allows District citizens to elect a mayor authorize state wage-and-benefit laws to party’s notice of removal to ‘a higher pleading and council. The powers and duties of the apply to contractors” because “Congress has standard than the one imposed on a plaintiff council are similar to those held by governing shown it is capable of including language in drafting an initial complaint.’”45 boards in other localities, including the in statutes expressly stating that states authority to enact laws. One significant In Jones v. John Crane-Houdaille Inc., the U.S. have the power to apply the statute to land difference, however, is that Congress reviews District Court for the District of Maryland ceded to the United States” and therefore all legislation passed by the council before it addressed whether a defendant properly “the lack of an explicit authorization will can become law. removed a case to federal court based on often suggest that a statute is not clear and the federal enclave doctrine.46 The plaintiff unambiguous.”34 The court, therefore, agreed The act also specifically prohibits the council in Jones worked at the Aberdeen Proving “with the reasoning in Manning.”35 from enacting certain laws, such as those Ground which, in substantial part, is a that would: Even assuming that Congress, through the federal enclave. In his motion to remand, the SCA, ratified the application of certain state • Lend public credit for private projects. plaintiff argued that the defendant’s removal laws to federal enclaves, courts have held • Impose a tax on individuals who work in was defective because it did not provide full that claims for overtime do not constitute the District but live elsewhere. support for the contention that the portion “fringe benefits” as the term is used in the of the Aberdeen Proving Ground where the • Make any changes to the Heights of SCA or the Davis-Bacon Act. For example, plaintiff worked had in fact been ceded to or Buildings Act of 1910; the Bouthner court held that “even if this purchased by the federal government. The court accepted plaintiffs’ interpretation of • Change the composition or jurisdiction plaintiff argued further that even assuming, the Davis-Bacon Act, state and local law of the local courts. arguendo, that the territory had been would only apply to claims for fringe benefits. • Enact a local budget that is not procured by the United States, the defendant Plaintiffs’ allegations that they were not balanced. failed to sufficiently plead the degree of paid minimum wage, were misclassified as cession. The district court disagreed, stating: independent contractors or exempt persons, • Gain any additional authority over the Measured against the plausibility and were not timely paid their wages, do not National Capital Planning Commission, standard of Twombly [Bell Atlantic Corp. directly relate to ‘fringe benefits.’”36 The court the Washington Aqueduct or the District v. Twombly], the notice of removal is not continued: “Plaintiffs’ allegations that they of Columbia National Guard. defective for failing to allege Maryland’s were not paid overtime also does not amount Unless Congress overturns a District law, consent to exclusive federal legislative to a claim for fringe benefits, at least within Congress has essentially assented to jurisdiction. A judge in this district has the meaning of the Davis-Bacon Act.”37 concurrent jurisdiction. Moreover, these previously explained, in detail, why On the basis of the analysis in Bouthner, the District laws have been applied to private the federal government has exclusive 40 Diaz decision can be distinguished because employers working in the District. legislative jurisdiction over portions, at those claims related to the defendant’s least, of the Aberdeen Proving Ground.

6 | WESTLAW JOURNAL n EMPLOYMENT © 2013 Thomson Reuters Other judges in this court have also 2004 WL 691790, at *1 (N.D. Fla. Mar. 19, 2004) 21 Goodyear Atomic Corp., 486 U.S. at 180. (Department of the U.S. Navy, Coastal Systems noted that parts of Aberdeen Proving 22 Station, in Panama City, Fla.); Kelly v. Lockheed 40 U.S.C. § 290. Ground are federal enclaves. In addition Martin Servs. Group, 25 F. Supp. 2d. 1 (D.P.R. 23 Goodyear Atomic Corp., 486 U.S. at 182. [...], opinions in several other cases in the 1998) (Roosevelt Roads Naval Station in Ceiba, district have referred to the Aberdeen Puerto Rico). 24 42 U.S.C. § 7401. Proving Ground, on which Edgewood 4 United States v. Windsor, 765 F.2d 16 (2d 25 42 U.S.C. § 7418(a). 47 Cir. 1985) (Knolls Atomic Power Laboratory in Arsenal sits, as a federal enclave. 26 40 U.S.C. §§ 3141 et seq. Windsor, Conn.). The court denied the motion to remand, 27 Bouthner v. Cleveland Constr., 2011 WL 5 Allison v. Boeing Laser Tech. Servs., 689 F.3d without prejudice, pending further discovery 2976868, at *3 (D. Md. July 21, 2011). 1234 (10th Cir. Aug. 10, 2012). regarding the specific location of the plaintiff’s 28 6 41 U.S.C. § 351(a)(2). workplace, as well as the date and manner by Paul v. United States, 371 U.S. 245, 264 (1963). 29 See, e.g., Lebron Diaz v. Gen. Sec. Servs. Corp., which the land was procured by the federal 7 Office of the Attorney Gen. of the State of 93 F. Supp. 2d 129 (D.P.R. 2000). government. The court concluded that if the Md., 61 Op. Atty. Gen. Md. 441 (1976) (addressing whether the National Naval Medical Center in 30 Id. at 141-42. defendant could not support its defense, the Bethesda, Md., was a federal enclave). court could remand the case to state court 31 See, e.g., Manning v. Gold Belt Falcon, 681 F. 8 for lack of subject matter jurisdiction. Koren v. Martin Marietta Servs., 997 F. Supp. Supp. 2d 574, 577 (D.N.J. 2010). 196, 202 (D.P.R. 1998) (state law existing at the 32 As a result, employers who are sued in state time of cession still applies within the enclave Id. until a federal law abrogates the state law). court for an alleged violation of a state 33 Id. 9 Cooper v. S. Cal. Edison Co., 170 Fed. Appx. wage-and-hour law in a putative class action 34 Bouthner, 2011 WL 2976868, at *5. (subject to that state’s version of Federal Rule 496 (9th Cir. May 10, 2006) (federal enclave doctrine preempts state law claims that do not 35 Id. of Civil Procedure 23) over work performed pre-date the acquisition of the enclave). at a federal enclave have greater flexibility 36 Id. at *6. 10 First, federal law does not preempt state law 37 in removing the lawsuit to federal court if if the state had, at the time of cession, expressly Id. the employer can meet the “plausibility” reserved the right to legislate over the matters 38 Council of the District of Columbia, DC Home standard under Twombly. This flexibility is at issue. Second, federal law will not preempt Rule. particularly welcome since it may be difficult state regulatory schemes that were in place prior to the date of cession, but which require ongoing 39 D.C. Code §§ 1-201.01. for an employer to develop fully the complete changes by a regulatory body. Finally, state law 40 the factual record necessary to support the will apply in federal enclaves if Congress provides Twenty Citizens of the District of Columbia v. Clinton (D.D.C. June 30, 1998) (“The home rule application of the federal enclave doctrine “clear and unambiguous” authorization for such state regulation over its federal enclave. government [comprised of the council of the prior to the statutory removal deadline. District of Columbia, the mayor of the District 11 See, e.g., Allison, 689 F.3d at 1240. (“Judge- of Columbia and the various administrative CONCLUSION made common law is no different than departments] does not constitute a republican Legislature-made law in application and effect. form of government, because every action of The federal enclave doctrine is a potentially When a state court adopts a new cause of action the home rule government is subject to absolute potent weapon for defendants in employment through its common-law powers, that cause of review and veto by the Congress of the United action functions no differently than if it had been States itself or by defendant District of Columbia and other litigation since, if applicable, the created by the state legislature.”) Financial Responsibility and Management doctrine will preclude all state law claims Assistance Authority acting as an administrative 12 424 F. Supp. 2d 545 (E.D.N.Y. 2006). enacted after the creation of the enclave, agent or instrumentality for the Congress of 13 the United States of America and because the including class-wide state wage-and-hour Sundaram v. Brookhaven Nat’l Labs., 424 F. Supp. 2d 545 (E.D.N.Y. 2006). home-rule government was created by an act of claims. As a result, and because it can be Congress and not by an autonomous act of the difficult to quickly develop the factual record 14 Paul v. United States, 371 U.S. 245, 269 (1963). citizens of the District of Columbia and because the Congress of the United States holds the necessary to confidently rely on the doctrine, 15 Goodyear Atomic Corp. v. Miller, 486 U.S. 174 exclusive power to alter or abolish the home-rule (1988). it is important that any employers working on government at any time.”). any federal property, such as a military base, 16 See, e.g., Mont. Code Ann. § 2-1-202. 41 medical facility, courthouse or other federal Morgan v. Rankin, 436 Fed. Appx. 365 (5th Cir. 17 See, e.g., Md. Code. Ann., State Gov’t § 14-102 Aug. 10, 2011). building or national park, determine sooner (“With respect to land that the United States or 42 Bell Atl. Corp. v. Twombly, 550 U.S. 544, 554- rather than later whether the federal enclave any of its units leases or otherwise holds in the 56 (2007). doctrine is available to them. WJ state, the state reserves jurisdiction and authority over the land and over persons, property, and 43 28 U.S.C. § 1446(a). transactions on the land to the fullest extent that NOTES is permitted by the United States Constitution and 44 Id. 1 that is not inconsistent with the governmental U.S. Const. art. I, § 8, cl. 17. 45 Ellenburg v. Spartan Motors Chassis, 519 F.3d purpose for which the land is held.”) (emphasis 2 192, 200 (4th Cir. 2008) (citing Bell Atl. Corp. v. See, e.g., United States v. Markiewicz, 978 F.2d added). 786, 797 (2d Cir. 1992). Twombly, 550 U.S. 544, 554-56 (2007)). 18 Brookhaven Nat’l Labs., 424 F. Supp. 2d at 46 3 See e.g., Bouthner v. Cleveland Constr., 2011 WL 570. Jones v. John Crane-Houdaille Inc., 2012 WL 2976868 (D. Md. July 21, 2011) (National Naval 1197391 (D. Md. Apr. 6, 2012). 19 Id. Medical Center in Bethesda, Md.); Manning v. 47 Id. Gold Belt Falcon LLC, 681 F. Supp. 2d 574 (D.N.J. 20 Paul, 371 U.S. at 269. 2010) (Fort Dix, N.J.); Hutchison v. Andrulis Corp.,

© 2013 Thomson Reuters APRIL 17, 2013 n VOLUME 27 n ISSUE 19 | 7 WRONGFUL TERMINATION (JURY VERDICT) Nonprofit whistle-blower employee nets $1.6 million retaliation award A former senior case manager at a New Jersey ex-convict rehabilitation facility has been awarded more than $1.6 million in damages plus back pay after she was fired for reporting a manager’s unethical and retaliatory conduct.

Pietrowski v. Kintock Group, No. 111003328, According to her October 2011 complaint, had been telling her that she was being verdict returned (Pa. Ct. Com. Pl., Phila. Pietrowski worked for Kintock, a nonprofit groomed for the director position. County Mar. 22, 2013). organization that helps people recently The suit says that due to Miranda’s increasing released from prison to transition back into A jury in the Philadelphia Court of hostility toward Pietrowski, he did not society, from July 2009 until her termination Common Pleas unanimously found that recommend her for the director position in two years later. Marla Pietrowski’s former employer, The 2010, and she was passed over. Kintock Group, violated the New Jersey She alleged the company terminated her In April 2011 she complained of a hostile work Conscientious Employee Protection Act, N.J. after she reported comments by interim environment created by Miranda and his Stat. Ann. § 34:19-1, by creating a hostile director Yari Miranda that led her to believe handpicked successor, Erinn Hendricks, the work environment and terminating her for he was involved in illicit drug dealing. complaint said. reporting conduct that violated company policy. The New Jersey Conscientious Employee Protection Act The state CEPA protects employees from being fired in retaliation for disclosing or protects employees from being fired in retaliation for disclosing objecting to a wrongful business practice or or objecting to a wrongful business practice or conduct by a conduct by a fellow employee. fellow employee. The jury awarded Pietrowski $1.5 million in punitive damages, $100,000 for pain and In October 2009 Pietrowski reported Miranda Two months later, Kintock terminated suffering and just shy of $78,000 in back pay. because involvement with illegal drugs is Pietrowski for gross misconduct, purportedly “I feel so thankful to the jury for their a violation of company policy, and she was for making false allegations about Miranda ability to see that I was a victim of abuse of concerned about his ability to work in a and Hendricks. power and that employees who stand up to facility that deals regularly with individuals Pietrowski alleged she was terminated their employers and voice concerns about who require treatment for drug abuse, the despite receiving only positive performance wrongdoing in the workplace should not fear complaint said. reviews and evaluations, the complaint said. being fired,” Pietrowski said, according to a Pietrowski also notified superiors when She also alleged her abrupt firing violated statement from Console Law Offices, which Miranda violated company regulations by company policy that calls for “progressive represented her. bringing his 8-year-old daughter to work discipline,” which alerts an employee about Pietrowski, who lives in New Jersey and even though several registered sex offenders objectionable conduct and provides an worked out of a Kintock office there, filed the were enrolled in the Kintock program, the opportunity to change. WJ New Jersey state law claims in Philadelphia complaint said. She said Miranda’s actions Attorneys: court because the company’s headquarters endangered his child. Plaintiff: Laura C. Mattiacci and Rahul Munshi, Console Law Offices, Philadelphia are in Pennsylvania and it does business in A year after reporting Miranda, Pietrowski Defendant: Caren Litvin, Radnor, Pa. the city, the Console Law statement said. applied for the director position to permanently replace him. She said in her Related Court Documents: Kintock Group filed a motion April 1 seeking Verdict sheet: 2013 WL 1390609 to overturn the verdict. lawsuit that beginning shortly after the time Damages verdict sheet: 2013 WL 1390637 she was hired, Miranda and other officials Complaint: 2011 WL 10550714

Online auctioneer eBay Inc.’s no-hiring pact with financial software maker Intuit Inc. served no purpose other than to restrict competition for employees, the Justice Department has told a California federal court.

United States v. eBay Inc., No. CV 12-5869, opposition brief filed (N.D. Cal., San Jose Div. Feb. 26, 2013). The government is suing eBay in the U.S. District Court for the Northern District of California over the companies’ alleged “handshake” agreement not to recruit or hire each other’s employees. The Justice Department says the deal effectively lowered salaries and restricted personnel mobility. Intuit is not a defendant in the case because the government already sued the company over similar practices with different companies in 2010. A final settlement in that suit barred Intuit from entering into or enforcing any agreement to improperly limit competition for employees, according to the Justice Department. In a motion to dismiss the suit, eBay said the Department of Justice has failed to show how the agreement personally harmed any employees or broader market competition. REUTERS/Robert Galbraith

Moving to dismiss in January, eBay said there is no actionable antitrust The agreement was not necessary to achieve cause because the people mentioned by name all had served as officers a lawful procompetitive purpose, or directors of the company. Although the complaint purports to allege the Justice Department said. a conspiracy, eBay says, it focuses solely on conduct among directors and officers of a single company with a shared purpose.

But the government says in its Feb. 26 opposition brief that the pact The Justice Department also has not identified any actual harm to violated the Sherman Act, 15 U.S.C. § 1, because the firms robbed competition that goes beyond eBay and Intuit, the motion to dismiss their employees of the chance to earn higher salaries and benefits and said. curbed their opportunities for career advancement. But the government says that some agreements are “so obviously “The agreement was not pursuant to a joint venture or other anticompetitive and lacking any redeeming justification that they may collaborative business relationship between the two firms that might, be condemned without requiring the full-blown analysis that antitrust in some other circumstances, justify specifically tailored agreements law requires in other circumstances.” necessary to achieve a lawful procompetitive purpose,” the Justice It also says the agreement “distorted the competitive process in the Department said. “It was a ‘naked’ restraint on competition, of the sort labor market that matches employees and jobs.” WJ most clearly condemned by antitrust law.” Related Court Documents: According to the suit, then-eBay CEO Meg Whitman and Intuit founder Opposition brief: 2013 WL 950609 Motion to dismiss: 2013 WL 578471 Scott Cook, who served on the board of both companies, were closely Complaint: 2012 WL 5727488 involved in forming, monitoring and enforcing the pact from 2006 through 2009.

© 2013 Thomson Reuters APRIL 17, 2013 n VOLUME 27 n ISSUE 19 | 9 ARBITRATION UNCOVER VALUABLE Arbitrator had ample cause to dismiss INFORMATION discrimination suit, California court says ABOUT YOUR A former employee’s conduct during an arbitration hearing, including trying to bribe a witness, gave the arbitrator reason to dismiss a suit that accused OPPOSING a construction company of age and race discrimination, a California appeals EXPERT court has ruled.

WITNESS Brooks v. Bechtel Corp. et al., No. A132926, had no duty to rehire Brooks and awarded 2013 WL 1205063 (Cal. Ct. App., 1st Dist., the company $20,000 in attorney fees. Div. 2 Mar. 26, 2013). Brooks asked the San Francisco County The 1st District Court of Appeal panel Superior Court to vacate the arbitrator’s affirmed a San Francisco judge’s decision to ruling, but in June 2011, Judge Peter Busch deny Rufus Brooks’ requests for a new trial denied the motion to vacate as well as or an order vacating the arbitrator’s ruling in Brook’s motion for a new trial. favor of Bechtel Corp. In his appeal, Brooks only addressed the Brooks worked on a telecommunications arbitrator’s first reason for dismissal: his project for Bechtel, one of the world’s largest alleged attempted bribery of witness Scott construction companies, between 2005 and Cuen. 2007, the panel’s opinion said. Brooks argued only that the arbitrator was In April 2008 Brooks filed a complaint with the wrong in finding that he had tried to bribe Judicial Arbitration and Mediation Services Cuen to change his testimony because Cuen against the San Francisco-based Bechtel had been improperly allowed to testify over and its officers, claiming the company failed the telephone, the opinion says. to pay him overtime. Three months later, he The panel said that even if Brooks were added age and race discrimination claims correct that Cuen should not have been because Bechtel fired and refused to rehire permitted to testify over the phone, the him at the end of the project he was working trial court was still correct to confirm the Expert Intelligence Reports give you on, according to the appellate opinion. arbitrator’s decision because of the other the information you need to evaluate reasons cited by Thorpe: Brooks’ attempted your opposing counsel’s expert witness. Bechtel filed a counterclaim with JAMS, In every Expert Intelligence Report stating that it fired and did not rehire Brooks bribery and intimidation, uncivilized conduct, you request, you’ll find comprehensive, because of his inappropriate conduct, and evasive testimony. logically organized documentation of including repeated harassing phone calls “Any one of these reasons was an adequate an expert’s background and perform- and aggressive and threatening emails sent and correct basis for the denial of appellant’s ance as an expert witness: transcripts, to company executives. depositions, challenges, resumes, petition to vacate the arbitrator’s ruling,” the publications, news stories, social media Arbitrator R. Wayne Thorpe granted Bechtel’s panel said. WJ profiles – even hard-to-get expert motion to dismiss all the claims, finding that Attorneys: testimony exhibits from dockets. Brooks had attempted to bribe one witness Plaintiff/appellant: Rufus Brooks, Orlando, Fla., pro per Learn more at TRexpertwitness.com/ and intimidate two others, had engaged in intelligence. uncivilized conduct during depositions and Defendant/respondent: Paul W. Cane Jr., Paul Hastings Janofsky & Walker, San Francisco conferences, and had given “evasive and deceptive” testimony. Related Court Document: Opinion: 2013 WL 1205063 “I have never before witnessed conduct so fundamentally disrespectful of our legal See Document Section B (P. 31) for the opinion. system,” Thorpe said. He ruled that Bechtel

(Reuters) – A case heard by the U.S. Supreme Court March 25 over class-action arbitrations could have deep repercussions on both employers and employees.

Oxford Health Plans LLC v. Sutter, class-based arbitration even where the No. 12-135, oral argument held (U.S. underlying agreement does not provide for Mar. 25, 2013). class arbitration procedures,” the Equal Employment Advisory Council, a group of The case concerns a doctor who sued Oxford about 300 large employers, wrote in its brief. Health Plans in state court in New Jersey on behalf of a proposed class of physicians who Rae Vann, an attorney at Norris, Tysse, claimed the health insurer underpaid them. Lampley & Lakis, who wrote the amicus brief Oxford successfully moved the case into for the council, said class arbitrations simply arbitration, citing a contract agreed to by its defeat the purpose of arbitration. network of physicians. “The reason why we don’t see class An arbitrator ruled that a class of doctors arbitration as a matter of course is it doesn’t could pursue their arbitration against the company, even though the contract’s “If plaintiffs’ lawyers figure out they could pursue a class arbitration clause did not specifically call arbitration, employers could be more liable more often [and] for class arbitration. A trial court affirmed the ruling, as did the 3rd U.S. Circuit Court arbitration could be less cheap,” Saint Louis University School of Appeals, and Oxford appealed to the high of Law professor Marcia McCormick said. court. While the case does not specifically make much sense to require arbitration and you like and there’s nothing the courts can encompass employment disputes, then have a situation where we are mirroring do about it.’” companies nonetheless have weighed in on court procedures,” said Vann. Katz held steady to his assertion that Oxford’s side, hoping that class arbitrations the courts have given great deference to AFTER WAL-MART are limited in the employment context as arbitrators. well. While class arbitrations are not prevalent, “I respectfully submit, as this court repeatedly employers may be concerned that such “If the court rules that the arbitrator had held, that courts do not have the authority actions could pick up as court-litigated class exceeded his authority by allowing a class to second-guess the arbitrator and make actions decrease in the wake of Wal-Mart procedure, it would be quite logical that the decisions or come up with a resolution that v. Dukes, 131 S. Ct. 2541 (2011) and other same principle would apply to employment would have been different with the arbitrator Supreme Court rulings, McCormick said. arbitrations,” said Richard Alfred, an just because they disagree,” said Katz. attorney with Seyfarth Shaw who represents “If plaintiffs’ lawyers figure out they could Alfred, the Seyfarth Shaw lawyer who employers. pursue a class arbitration, employers could represents employers and who attended the be more liable more often [and] arbitration A win for Oxford would be “a big windfall argument, predicted the Supreme Court will could be less cheap,” she said. “I think they for employers,” said Marcia McCormick, a rule 6-3 to reverse the lower courts. professor at Saint Louis University School are worried about plaintiffs figuring out this Such a ruling, said Alfred, “very well may of Law, because plaintiffs tend to be more is an option and taking advantage of it.” relieve employers of the concern about class successful when they litigate as a group than The dialogue at the Supreme Court March arbitration and provide an incentive to go when they pursue claims individually. 25 centered on how much deference courts forward with arbitration programs.” WJ The Chamber of Commerce, the Equal must give arbitrators to come to their own (Reporting by Carlyn Kolker) Employment Advisory Council and the Voice interpretations of a contract. Justices of the Defense Bar all filed amicus groups Antonin Scalia and Stephen Breyer and Chief Attorneys: Justice John Roberts all had a series of rapid- Respondent (Sutter): Eric Katz, Mazie Slater Katz in favor of Oxford, citing concerns that & Freeman, Roseland, N.J. permissive use of classes could wipe out the fire questions for Eric Katz, who represented the physician. Petitioner (Oxford Health): Seth Waxman, Wilmer benefits of arbitration. Cutler Pickering Hale and Dorr, Washington D.C. “The financial and other benefits that An arbitrator can permit a class action, Related Court Document: the parties derive from employment Justice Scalia said, “as long as he says, ‘I’m Oral argument: 2013 WL 232724 arbitration are likely to disappear altogether interpreting the agreement, it can be as if they are forced to submit to complex, wildly inconsistent with the agreement as

(Reuters) – Just one week after the U.S. Supreme Court issued a decision limiting the criteria by which classes can be certified, repercussions were already percolating through labor and employment cases.

In Comcast Corp. et al. v. Behrend et al., McAvoy ruled that, based on the Comcast No. 11-864, 2013 WL 1222646 (U.S. Mar. 27, decision, a group of workers at Applebee’s 2013), the court ruled 5-4 on March 27 that restaurants in New York and Connecticut 2 million Comcast subscribers could not could not pursue some of their wage-and- bring antitrust claims as a class, saying the hour claims against the restaurant operator plaintiffs failed to show that damages could as a class action. Judge McAvoy found that, be accurately measured for the group. as in the Comcast case, plaintiffs did not On April 1, the Supreme Court cited that have a consistent theory of damages that decision as it vacated a ruling by the U.S. 7th cut across all class members. “In the instant case, plaintiffs have not offered a damages REUTERS/Jonathan Ernst Circuit Court of Appeals, which had allowed a U.S. Supreme Court building model susceptible of measurement across class action to proceed against RBS Citizens “I expect the management bar will take a the entire class, arguing instead that this alleging violations of the federal wage-and- shot at knocking out unpaid-wage cases issue is separate from the question of hour law. The Supreme Court remanded the based on Comcast, just like they did in Wal- liability,” Judge McAvoy wrote. Roach et al. v. case, RBS Citizens d/b/a Chart One v. Ross et Mart v. Dukes and every other inapplicable T.L. Cannon Corp. d/b/a Applebee’s et al., No. al., No. 12-165, 2013 WL 1285303 (U.S. Apr. Supreme Court decision they think might 10-0591, 2013 WL 1316452 (N.D.N.Y. Mar. 29, 1, 2013), to the Chicago-based appeals court give them some traction,” Swartz said. “But 2013). for further consideration. While the remand in the end, wage-and-hour cases are simple does not necessarily mean the 7th Circuit will LAWYERS REACT challenges to illegal pay policies and are reverse its previous ruling, it gives the defense almost always perfect for class certification.” an opportunity to revisit the case armed with Gerald Maatman, an attorney at Seyfarth William Allen, an attorney at Littler new law from the high court. Shaw who represents employers in wage Mendelson who represents employers, disputes, said the Comcast ruling will now No sooner had the Supreme Court issued said plaintiffs and defendants will continue likely appear in defense motions at the its order in Ross than lawyers representing to seek clarity from the courts on how to certification stage of wage-and-hour cases. RBS Citizens in a related case seized on interpret the decision. it. On April 1, on the eve of a trial in federal “What Comcast has done is said class “I think it’s going to be very similar to Dukes court in Pittsburgh, RBS Citizens’ counsel certification is a make-or-break, really in terms of evolution,” Allen said. “The at Proskauer Rose asked U.S. District Judge important fork-in-the-road decision,” he said. interpretation by the district courts will take Gary Lancaster to consider decertifying a “Federal judges really need to sift through the some time, and then it will take another six class of assistant branch managers suing the evidence and really do an in-depth analysis: months to two years to work its way through bank over violations of wage-and-hour laws. Can plaintiffs’ evidence really be applied to the circuit courts, and then it will work its way The Supreme Court’s order in the Ross v. everyone? Can damages be decided on a on.” WJ RBS Citizens and its decision in the Comcast class-wide basis?” (Reporting by Carlyn Kolker) case make the certification issue “ripe for But Justin Swartz, an attorney at re-examination,” Proskauer lawyers argued. Outten & Golden who represents employees Judge Lancaster did not rule on RBS Citizens’ in employment litigation, predicted that motion, and a jury was selected in the case Comcast’s effect on wage-and-hour cases April 2. will be muted because the ruling focused Even before the Ross order, at least one other narrowly on how damages are construed, judge had cited Comcast in an employment typically not a controversial issue in case. On March 29, just two days after the wage-and-hour cases. Comcast decision, U.S. District Judge Thomas

(Reuters) – The 4th U.S. Circuit Court of Appeals ruled that a shuttle-service driver’s wage dispute with his employer must be arbitrated, demonstrating the broad reach of the U.S. Supreme Court’s 2011 ruling in AT&T Mobility v. Concepcion. Muriithi et al. v. Shuttle Express et al., ruled, would have forced Muriithi to incur arbitrate their antitrust claims. Am. Express No. 11-1445, 2013 WL 1287859 (4th Cir. prohibitive costs. Co. et al. v. Italian Colors Restaurant et al., No. Apr. 1, 2013). Later that year, the Supreme Court issued its 12-133, cert granted (U.S. Nov. 9, 2012). Citing the Concepcion decision, the 4th Circuit ruling in Concepcion. John Singleton, the lawyer representing on April 1 held that Samuel Muriithi, a driver Appeals court Judge Barbara Milano Keenan, Muriithi, did not reply to a message seeking for airport shuttle service Shuttle Express, who was joined by Judges Andre Davis and comment. could not sue for unpaid wages under the Fair John Gibney who sat by designation, ruled “I think the message is certainly that, with Labor Standards Act because an agreement that the Concepcion decision, which upheld class-action waivers, the trend is very clear he had signed with the company in 2007 arbitration contracts in a consumer setting, what the Supreme Court intended,” said mandated that disputes between workers was applicable to the Shuttle Express William Allen, a lawyer at Littler Mendelson and the company be arbitrated. contract. Moreover, the panel ruled, Muriithi who represents companies in wage disputes Muriithi had alleged that he and a class of did not meet the “substantial burden” and who was not involved in the case. WJ other shuttle drivers were misclassified as needed to prove that the cost of arbitration (Reporting by Carlyn Kolker) independent contractors and should have was so high as to render it prohibitive. Attorneys: been deemed employees who were entitled Christopher Parlo, who represented Shuttle Plaintiff: John Singleton, Singleton Law Group, to minimum wage and overtime pay. Express, said he was pleased with the court’s Baltimore The 4th Circuit’s ruling vacated U.S. decision. “I am hopeful that it is a precursor Defendant: Christopher Parlo, Russell Bruch and District Judge Alexander Williams’ March to what the Supreme Court will do in the Melissa Rodriguez, Morgan Lewis & Bockius, New York 2011 ruling that the company’s arbitration cases before it having to do with class-action agreement, which prohibited class-action waivers,” Parlo said. He was referring to a case Related Court Document: Opinion: 2013 WL 1287859 suits, prevented Muriithi from vindicating before the high court that turns on whether his statutory rights and therefore was not merchants can sue American Express as enforceable. Arbitration, Judge Williams a group or whether they must individually

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© 2013 Thomson Reuters APRIL 17, 2013 n VOLUME 27 n ISSUE 19 | 13 UNIONS Magic Laundry argued in opposition that the unions had “abandoned legitimate union bargaining” in an attempt to take away its Judge sees no evidence of racketeering in right to organize and run its business as it wished. unions’ ‘corporate campaign’ The company maintained that it had the right to decided whether to recognize the union as A federal judge in Los Angeles has ruled that a commercial laundry company representatives of its employees. failed to show that union organizers tried to extort its right to operate its Judge Fitzgerald granted the unions’ motion business independently by attempting to unionize its workers. to strike the suit’s state law claims, finding California’s “anti-SLAPP” law protected Magic Laundry Services Inc. v. Workers In the strategy, unions use publicity and the unions’ actions, including allegedly United Service Employees International governmental and regulatory pressures on defamatory fliers and demonstrations. Union et al., No. 12-09654, 2013 WL companies. SLAPP stands for strategic lawsuits against 1409530 (C.D. Cal. Apr. 8, 2013). Magic Laundry says that after it initially public participation. The anti-SLAPP law U.S. District Judge Michael W. Fitzgerald of refused to allow its employees to unionize, protects from private suit anyone speaking the Central District of California gave Magic the defendants waged a public campaign out on public issues or petitioning the Laundry Services one final chance to support against it, including holding loud and government. its suit against the Workers United Service disruptive protests outside company facilities, Employees International Union and its local distributing fliers with false information According to the judge’s order, a suit affiliate, Western States Regional Joint about the company, and appealing to designed “primarily to chill the exercise of Board, Local 52, but expressed doubt that politicians for support. First Amendment rights” can be dismissed at an early stage in the proceedings. the company can succeed on its racketeering Magic Laundry alleged the defendants claims. conspired to extort its rights to operate In dismissing the suit’s RICO claim, Judge The judge said the company could file an its business as it chose and committed Fitzgerald said Magic Laundry’s complaint amended complaint before the end of April. mail and wire fraud by disseminating false failed to show extortion by the unions. “Perhaps there will be a second amended statements about the company in violation Without showing that the defendants complaint but there will be no third,” he said. of the Racketeer Influenced and Corrupt obtained or tried to obtain “a property Organizations Act, 18 U.S.C. § 1961. right” from the company, the unions’ actions According to the judge’s order, following are only coercion, not extortion under the an April 1 hearing, Magic Laundry lacked Magic Laundry sought injunctive relief and racketeering law, the judge said. sufficient facts to make a prima facie case exemplary and punitive damages for lost that the unions had engaged in extortion or business and damage to its reputation. The defendants only “exerted coercive mail and wire fraud. In support of their motion to dismiss, the pressure” to get Magic Laundry to recognize the unions, the order said. Judge Fitzgerald also dismissed the unions argued that Magic Laundry had not company’s state law claims, including shown that they engaged any conduct that Additionally, the judge found that the defamation and trespass, finding that state would be considered criminal under RICO. company failed to provide specific facts to law and the First Amendment protected the The racketeering law “was never intended show that the unions conducted a fraudulent unions’ conduct. to outlaw legitimate union organizing, even scheme or used mail and wire fraud to further aggressive union organizing,” the defendants that scheme. Magic Laundry, which has more than 300 said in a reply brief. employees, filed suit alleging the unions Judge Fitzgerald granted Magic Laundry’s aggressively sought to unionize its workers The unions also said their “peaceful counsel’s request for an opportunity to because the unions needed to collect pamphleteering” was part of a legitimate amend the complaint a second time; he gave additional member dues to meet their own labor organizing effort and is protected by the the company 14 days from the date of the financial obligations. First Amendment to the U.S. Constitution. order to file a second amended complaint. WJ According to the suit, the unions initiated a “In seeking to exert social pressure on Attorneys: “corporate campaign” strategy combining [plaintiff], the union’s methods may be harassing, upsetting or coercive, but Plaintiff: Talin V. Yacoubian, Yacoubian & Powell, legal and illegal methods to strong-arm Los Angeles Magic Laundry into entering into a collective unless we are to depart from settled First Amendment principles, they are Defendants: Glenn Rothner, Rothner, Segall & bargaining agreement with its employees. Greenstone, Pasadena, Calif. constitutionally protected, “ the brief said, A corporate campaign is a approach used quoting Metropolitan Opera Association v. Related Court Documents: by the labor movement to force an employer Order: 2013 WL 1409530 Local 100, HERE, 239 F.3d 172, 177-78 (2d Cir. Reply in support of motion to dismiss: 2013 WL to allow union organizing of its workforce. 2001). 1415396 Opposition to motion to dismiss: 2013 WL 867259

A tobacco company claims a former employee stole proprietary information about its clients and business practices during the course of his employment and gave it to a competitor that later hired him.

Republic Tobacco L.P. v. Ferraro et al., Ferraro allegedly stole confidential similar job for Lane. For several weeks in No. 1:13-CV-01639, complaint filed information and trade secrets, including January and February until his resignation, (N.D. Ill., E. Div. Mar. 4, 2013). information about key clients and strategies, Ferraro allegedly collected confidential The company says both the ex-employee while employed by Republic. He then used information about Republic and passed it and its competitor misappropriated trade the information “in trying to lure away onto Lane. secrets and should be required to pay for the Republic’s customers on behalf of Lane,” the For example, he requested detailed marketing damage they caused. suit says. plans that Republic had developed for some Glenview, Ill.-based Republic Tobacco LP “Critical to Republic’s success has been its of its largest clients, and store lists for two sued Paul Ferraro and Scandinavian Tobacco development of confidential information other clients, the suit says. Group Lane Ltd., or Lane, which is based in and trade secrets, including but not limited “The information described above is highly Tucker, Ga., in the U.S. District Court for the to sales data, pricing and cost information, confidential and proprietary, would not Northern District of Illinois. local market conditions and references, normally be available outside Republic or marketing plans and distribution strategies,” within Republic by people without a need Republic is the “nation’s leading distributor” the complaint says. of products such as pipe tobacco, roll-your- to know, and would be of great use to a own tobacco, cigars and cigarette filters, Ferraro was a key accounts manager for competitor of Republic, such as Lane,” the according to the suit. Republic beginning in September 2010 who suit says. was responsible for selling the company’s Republic maintains that Ferraro breached “Republic has spent tens of millions of products to more than 70 retail chains in the dollars and enormous energy developing the confidentiality agreement he signed Northeast, generating nearly $5 million in during his employment. customer contacts and relationships, and annual revenue, according to the suit. an extensive understanding of its customers’ The complaint alleges claims against Ferraro special needs, issues and plans over a period Republic says Ferraro “abruptly” resigned for breach of contract and fiduciary duty, and of approximately 40 years,” the complaint Feb. 18 and started performing the same or tortious interference with contract against says. Lane. The company accuses both defendants of misappropriation of trade secrets. Trade secrets Republic seeks injunctive relief to stop Ferraro from using the confidential information.

Republic Tobacco claims that former employee Paul Ferraro possessed the “The harm is irreparable and ongoing following confidential information and trade secrets about its business when because confidential information, once he resigned: disclosed to a competitor, cannot be erased from the competitor’s mind, and customer • Marketing strategies, including the companies Republic planned to target, the price relationships are inherently delicate and structures for such companies and the new customer sales methods it intended to cannot be replaced or repaired with money introduce. damages,” the suit says. • Customer lists, including key personnel to target for sales opportunities, information on It also seeks compensatory damages, the pricing and features of accounts, stores, sales histories and forecasts, profitability, punitive damages and attorney fees and and customers’ special needs and planning diagrams for product placement. costs. WJ • Relationships with brokers and distributors, including crucial competitive information Attorney: about the amount of compensation paid to these third parties. Plaintiff: Charles S. Bergen, Grippo & Elden, Chicago • Pricing plans and strategies for securing new business and keeping old business. Related Court Document: • Management methods such as those pertaining to structuring and running its Complaint: 2013 WL 787160 business. See Document Section C (P. 35) for the complaint. • Key sales employee information, including salary, bonuses and benefits.

© 2013 Thomson Reuters APRIL 17, 2013 n VOLUME 27 n ISSUE 19 | 15 INSURANCE Goldman Sachs CONTINUED FROM PAGE 1 8th Circuit rejects coverage for employee’s Parisi’s suit, which she filed after her firing in 2008, alleged a pattern of discrimination gunfire injuries against female Goldman Sachs employees. The company’s conduct allegedly violated A car dealership’s commercial liability insurance excluded coverage for an both Title VII and the New York City Human employee’s accidental shooting of a co-worker because the triggering event — Rights Law. monitoring for possible intruders — took place during the course of the victim’s employment duties, a federal appeals court has ruled. The 2nd Circuit said Gear Automotive v. Acceptance Indemnity arbitration would not Insurance Co., No. 12-2446, 2013 WL prevent the plaintiff from 1092290 (8th Cir. Mar. 18, 2013). “vindicating” a statutory An exclusion for employee injuries provided right protected by Title VII. that the policy did not cover the dealership’s liability to employees, the 8th U.S. Circuit Court of Appeals said. In finding for Goldman Sachs, the panel reversed a decision by U.S. District Judge Robert Gear, sole owner of Gear Automotive Leonard B. Sand of the Southern District LLC, sued his own company in Missouri state of New York. He had adopted a magistrate court over shooting injuries described by the judge’s opinion allowing Parisi to proceed appeals court’s opinion as “grievous and with her class action to avoid waiver of a substantial.” substantive right under Title VII. SHOOTING INCIDENT But the appellate court found that arbitration would not result in any such waiver and there In October 2008 Robert Gear hired Joe was no reason to deviate from the federal Posner for one evening to help him and his policy favoring arbitration. Although Parisi brother, full-time employee Darrell Gear, can arbitrate only her individual claims, she watch the car dealership after the police is free to present evidence to the arbitral had advised that some unidentified people body of discriminatory patterns, practices or might attempt to burglarize the dealership policies, the panel said. WJ premises. REUTERS/Eddie Keogh Related Court Document: While pursuing an intruder on the property, the policy’s employee exclusion supports Panel opinion: 2013 WL 1149751 Posner fired a gunshot that struck Robert judgment in the insurer’s favor. See Document Section A (P. 25) for the opinion. Gear in the leg, the opinion said. The policy excluded coverage for bodily injury Gear Automotive’s commercial liability to an employee “arising out of and in the carrier, Wilshire Insurance Co., denied course of … employment.” a claim Robert made for his injuries. In The appeals court said Robert’s role as the meantime, Robert Gear and Gear owner of Gear Automotive did not exclude Automotive settled a suit that Robert filed his position as an employee. He generally against his own company for $350,000. engaged in the same daily activities at the Robert subsequently pursued payment from dealership as his brother Darrell, who was Wilshire in Missouri state court. indisputably an employee, the opinion said. The insurer removed the case to the U.S. When Posner shot Robert, he also was District Court for the Western District of engaged in the same activity as Darrell Missouri, and the District Court granted (monitoring the property), the judges noted. summary judgment to Wilshire on the ground that Gear Automotive failed to purchase They also found that the shooting incident workers’ compensation insurance for the happened within the course of their purpose of covering claims such as this. employment, so the exclusion applied and the judgment in Wilshire’s favor should be Gear appealed. affirmed. WJ The 8th Circuit said it would not reach Related Court Document: the workers’ compensation issue because Opinion: 2013 WL 1092290

(Reuters) - Both complaints were brought by pregnant women who said they were denied reasonable accommodations for pregnancy-related disabilities. Since 1978 the Pregnancy Discrimination than UPS’ accommodation of other, non- Court of Appeals ruled that the Pregnancy Act has prohibited employers from treating pregnant employees.” Discrimination Act did not require UPS to pregnant women differently from similarly A spokeswoman for UPS said the company accommodate pregnant worker Peggy Young situated employees. does not discriminate against pregnant by offering her light duty, despite offering it to In 2008 Congress passed the Americans with workers and that it adheres to all aspects of workers injured on the job. Young v. United Disabilities Act Amendments Act, expanding the law. Parcel Service et al., No. 11-2078, 707 F.3d 437 (4th Cir. Jan. 9, 2013). the definition of disability to cover pregnancy- Typically, the EEOC attempts to mediate related impairments, and the EEOC issued between the parties, and if that fails, it “The ADAAA certainly broadens the regulations codifying the act in March 2011. investigates the claim. If the investigation definition of disability and means that a In a complaint filed March 28, Amy Crosby, a finds that a law has been violated, the EEOC number of conditions caused by pregnancy cleaner who makes $9 an hour at Tallahassee can settle, sue or, in some cases, refer the might be treated as disabilities now, where Memorial Hospital, said she suffered from case to the U.S. Department of Justice. If no they wouldn’t have before,” said Samuel carpal tunnel syndrome. Her symptoms violation is found, the aggrieved party can still Bagenstos, a professor at the University intensified in her 23rd week of pregnancy, sue privately. of Michigan Law School and a prominent disability rights advocate. which she said made it impossible for her to A spokesman for the EEOC declined to lift heavy bags of laundry and trash. comment on the two cases. Bagenstos and other lawyers are preparing a petition on Young’s behalf at the U.S. After Crosby submitted a note from a But in its three-year strategic enforcement Supreme Court. chiropractic neurologist attesting to plan, released in December 2012, the agency pregnancy-related carpal tunnel syndrome, identified accommodating pregnancy-related Cara Greene, a co-chair of Outten & Golden’s the hospital said the information needed limitations under ADAAA and the PDA as an Family Responsibilities and Disability to come from her obstetrician. Crosby’s “emerging issue.” Discrimination practice group in New York, said obstetrician said she could not diagnose her these cases highlight how the PDA and the With little case law on the books since the and recommended a neurologist for the pains ADAAA interact to require accommodations regulations were issued in March 2011, in her arm. that the court denied to Young. employers are in uncharted waters, said Stacie Several supervisors refused her requests Caraway, an employment lawyer at Miller “Employers are missing the fact that just for work with limited lifting, and she was & Martin PLC in Chattanooga, Tenn., who is because a disability results from pregnancy, it involuntarily placed on unpaid leave under not involved in either case. For example, she doesn’t mean they don’t have to accommodate the Family and Medical Leave Act. said, it is difficult to tell whether the hospital’s it,” Greene said. “They just kept saying, ‘It’s policy, it’s policy,’” request for additional documentation was Legislation to codify these obligations has Crosby told Reuters. unreasonable. stalled. The Pregnant Workers Fairness According to the complaint, which was filed “We had 25 years of case law with the ADA Act, introduced last year in Congress, would by the National Women’s Law Center, other to tell us what was reasonable and what was require employers to make the same types hospital employees who had suffered injuries not, but now we’re starting from scratch,” she of accommodations for pregnancy, childbirth or were otherwise unable to complete aspects said. “That’s what makes these cases kind of and related medical conditions as they do for of their jobs had been accommodated. a crapshoot.” disabilities. It is due to be reintroduced this spring, according to a spokeswoman for the A spokesman for the hospital said he had not Employers should be “conservative” and National Women’s Law Center. seen the complaint and could not comment lean toward accommodating workers where on it. possible, Caraway said. “If the proof shows Galen Sherwin, a staff attorney with the that someone has a pregnancy-related American Civil Liberties Union’s Women’s LIGHT DUTIES disability, then the employer does have a duty Rights Project, said that the two laws, the PDA and the ADAAA, should already be sufficient. A separate complaint filed in January by to accommodate it as with cancer or any other the American Civil Liberties Union alleges disability.” “If employers are now required to treat a that United Parcel Service Inc. failed to broader category of disabled individuals with accommodate driver Julie Desantis-Mayer EARLIER CASE compassion by providing them the necessary when she was pregnant in the spring of 2012. The two cases highlight changes in the job accommodations, but they are refusing In August 2012 the company offered her a legal landscape since the Americans with those same type of job accommodations to light-duty position on the condition that it Disabilities Amendments Act was passed. pregnant women, that really flies in the face would not count toward seniority or benefits, In a 2008 case filed a few months before of Congress’s intent in passing the PDA.” WJ the law came into effect, the 4th U.S. Circuit an offer she described as “unlike, and worse (Reporting by Anna Louie Sussman)

UTAH’S INTERNET EMPLOYMENT DEUTSCHE BANK FACES 2ND SEX JURY AWARDS FIRED EPILEPSY PRIVACY LAW SIGNED DISCRIMINATION SUIT IN 2 YEARS VICTIM $109,000 IN ADA SUIT Utah Gov. Gary R. Herbert signed the In a Manhattan federal court suit, a An Army-Navy surplus store must pay Internet Employment Privacy Act into law former Deutsche Bank vice president says $109,000 to a former employee allegedly March 26, making Utah the latest state to the bank used a mass layoff in 2012 to fired because he suffers epileptic seizures, restrict what information employers can “disproportionately” target women. Heather according to a March 7 jury award in an require and access from their employees. Zhao alleges she endured discriminatory Equal Employment Opportunity Commission Under the law, employers cannot require comments from co-workers when she was lawsuit in Denver federal court. The EEOC employees or job applicants to disclose pregnant, and the company fired her shortly sued Western Trading Co. in 2010 on behalf their username and passwords associated before the end of her maternity leave. In of Tyler Riley, alleging the company failed to with personal, non-work-related Internet addition, Zhao says, a male supervisor refused accommodate his disorder. According to the accounts. The law does allow employers to give her a bonus after she complained that suit, the company permitted Riley to come to require staff to disclose usernames and he discriminated against her because of her back to work after he suffered a seizure on passwords for an employer-issued device gender. The suit alleges the German bank the job, but despite assurances from his or an account used for business purposes. violates federal and state employment laws, doctors, the company fired him after learning Employers can also restrict access to certain including the Family and Medical Leave Act. he had suffered another seizure off hours. websites on work computers and networks This is the second such action filed against The company also improperly kept Riley’s and can monitor data stored on employer- the German bank in the last two years. In medical records with his other employment provided devices and networks. The law September 2011 Kelley Voelker alleged her documentation, the suit said. The jury awarded Riley $24,000 in back pay, $20,000 limits damages from any legislative action work responsibilities were reduced when for emotional distress and $65,000 in punitive related to the statute to $500. The law she returned from a maternity leave. Voelker damages, according to an EEOC statement. passed through the Utah Legislature with v. Deutsche Bank, No. 11-6362, 2011 WL unanimous support. It is set to take effect 4014350 (S.D.N.Y. Sept. 12, 2011). Equal Employment Opportunity Commission et al v. Western Trading Co. Inc., No. 10- 2387, May 14. Zhao v. Deutsche Bank AG, No. 13-2116, 2013 WL 1285653 (D. Colo. Mar. 7, 2013). complaint filed (S.D.N.Y. Mar. 29, 2013). N.J. FOOD MANUFACTURER Related Court Document: Related Court Document: VIOLATED WAGE LAWS, SUIT SAYS Complaint: 2013 WL 1287358 Verdict Form: 2013 WL 1285653 A former mechanic for New Jersey-based J&J Snack Foods says the manufacturer violated WAFFLE RESTAURANTS TO PAY BLOOMBERG SUED OVER UNPAID federal and state wage laws and fired him FIRED WORKER $25,000 OVERTIME because he complained about it, according East Coast Waffles Inc., which operates more Former Bloomberg LP employee Lee Siegel to a federal court class action. Robert than 100 Waffle House restaurants in the alleges the media company failed to pay McMaster, who worked for the company South, has agreed to pay a former employee him and other computer help desk workers between June and November 2012, alleges $25,000 to settle an Equal Employment premium overtime wages in violation of the the company failed to pay him for his entire Opportunity Commission lawsuit charging Fair Labor Standards Act, according to a New shifts worked. According to the complaint, the company with retaliation. According to a York federal court complaint. Siegel, a New Jersey resident, worked as PC support staff the company required McMaster to clock March 28 EEOC statement, the agency sued at the company’s Princeton and New York out before he completed his daily tasks and the Atlanta-based company in Tampa federal City offices from September 2010 until July regularly docked him for break time even court following the firing of an employee who 2012, the suit says. PC support staff generally when he worked through lunch. McMaster complained about racial harassment by worked five eight-hour shifts per week, but alleges he was fired because he complained customers. The EEOC suit said the Waffle Siegel and other putative class members about being cheated out of his pay. The suit House violated Title VII of the 1964 Civil usually worked extra hours to complete seeks damages for lost pay for a proposed Rights Act by firing the worker in retaliation jobs, the suit says. Bloomberg, however, class of all other maintenance mechanics for opposing racial harassment. In addition compensated them for only 40-hour weeks, who the company failed to pay for their full to the monetary payment, under the consent shift in the last three years. WJ the suit says. The suit seeks unpaid wages, judgment, the company will give managers liquidated damages, and attorney fees and McMaster v. J&J Snack Foods Sales Corp. special training. costs. et al., No. 13-1677, complaint filed (D.N.J. Equal Employment Opportunity Mar. 19, 2013). Siegel et al. v. Bloomberg LP, No. 13-CV-1351, Commission v. East Coast Waffles Inc., complaint filed (S.D.N.Y. Feb. 26, 2013). Related Court Document: No. 13-525 (M.D. Fla. 2013). Complaint: 2013 WL 1345445 Related Court Document: Complaint: 2013 WL 830805

PERB REVIVES CHALLENGE TO that the instructors’ actions were motivated EMPLOYER’S REFUSAL TO PAY FOR COUNTY’S CHANGE TO UNION by their union activities. The unfair-practice UNION RELEASE TIME COMPORTS RELEASE TIME POLICY charge had no merit where the complainants WITH PERA PROVISIONS failed to make the requisite showing that the Ruling: California Public Employment Ruling: Michigan Employment Relations employer’s actions were motivated by their Relations Board reversed the dismissal of Commission adopted an administrative union activities, the IELRB decided. an unfair-practice charge and remanded law judge’s recommended dismissal of an the case for issuance of a complaint. In What it means: In order to establish a prima unfair-practice charge. The ALJ rejected the charge, the union alleged that the facie case of a violation of IELRA Section the union’s contention that the employer employer violated Meyers-Milias-Brown Act 14(a)(3), the complainants were required committed an unfair practice by failing provisions by unilaterally changing its policy to provide evidence indicating, in part, that to reimburse union members for their regarding compensation paid to employees an adverse action resulted from anti-union expenses in connection with attending on approved union release time. PERB animus (in whole or in part) or that union an MERC hearing, when it compensated found that the charge was timely pleaded activity was a substantial or motivating factor other employees for their attendance at the under the equitable tolling doctrine. It behind that adverse action. same hearing. The ALJ found no collective decided that the unfair-practice charge NEA, IEA, Illinois Eastern Community bargaining agreement provision requiring sufficiently alleged an established past Colleges Association et al. & Illinois Eastern the employer to compensate union members practice, subject to a unilateral change by the Community Colleges (Board of Trustees), in connection with their appearance at an employer without following meet-and-confer No. 529, 29 PERI 136, 2013 WL 1235481 (Ill. MERC hearing. The union did not show how procedures. The county denied the union’s Educ. Lab. Relations Bd. Jan. 24, 2013). the employer’s refusal to reimburse union statutorily guaranteed rights by causing members’ travel expenses here constituted employees to suffer a loss of compensation in ARBITRATOR WILL CONSIDER unlawful discrimination in violation of Public compensation or other benefits under MMBA DISPUTE OVER DISCHARGE OF PARK Employment Relations Act provisions, the Section 3505.3, PERB said. COMMISSION EMPLOYEES ALJ concluded. What it means: PERB noted that MMBA Ruling: In an unpublished decision, the What it means: As the ALJ noted, under Section 3505.3 requires public agencies Superior Court of New Jersey Superior Court MERC case law, a public employer lacks any to allow reasonable time for formal Appellate Division affirmed a decision by the statutory duty to compensate employees for negotiations “without loss of compensation Chancery Court. The appeals court upheld union activity, including time of work for the or other benefits.” It construed “loss” the Chancery Court’s ruling that an arbitrator purpose of testifying at an MERC hearing. within the meaning of that statutory section must consider the arbitrability of two District Health Department No. 2 & “as measured against the amount of pay grievances disputing the termination of two Professional Management Association, the employee would have earned if the non-probationary park employees. The trial 26 MPER 42, 2013 WL 1324548 (Mich. employee had not been ‘formally meeting judge properly referred the interpretation Employment Relations Comm’n Feb. 26, and conferring with representatives of the of the parties’ ambiguous negotiations 2013). public agency on matters within the scope of agreement to a Public Employment Relations representation.’” Commission arbitrator, the appeals court FORMER SCHOOL SECURITY Service Employees International Union, decided. GUARD’S DFR CLAIM AGAINST Local 721 v. County of Riverside, 37 What it means: Under New Jersey case UNION LACKS MERIT, MERC RULES PERC 180, 2013 WL 1274553 (Cal. Pub. law, once the Chancery Court determined Ruling: Michigan Employment Relations Employment Relations Bd. Mar. 1, 2013). that the issue required an interpretation of Commission considered the individual the negotiations agreement to resolve and charging party’s exceptions to an ABSENT EVIDENCE OF ANTI-UNION the CNA’s grievance procedures conferred administrative law judge’s recommended ANIMUS, CHALLENGE TO LAYOFF OF upon the arbitrator authority to interpret the dismissal of her unfair-practice charge. COLLEGE INSTRUCTORS FAILS CNA, it was required to defer the case for Charging party unsuccessfully alleged Ruling: The Illinois Educational Labor an arbitrator to decide between the parties’ that the union violated its duty of fair Relations Board upheld an administrative competing interpretations of the CNA. representation toward her by failing to law judge’s recommended dismissal of an Somerset County Park Commission v. prevent the subcontracting of school unfair-practice charge. The charge alleged Teamsters, Local 469, 39 NJPER 110, 2013 security work and by failing to prevent the that the employer community college district WL 1235495 (N.J. Super. Ct. App. Div. layoff of bargaining unit members. MERC violated IELRA provisions by laying off several Feb. 4, 2013). upheld the ALJ’s refusal to disqualify himself instructors in retaliation for their union from hearing the case. It modified the activities. The IELRB determined that the ALJ’s decision to indicate that the instant employer was aware of the union activities matter was not barred under the doctrines of the laid-off instructors. It rejected the of res judicata and collateral estoppel. unfair-practice complaint, absent evidence Nevertheless, MERC concluded that charging

© 2013 Thomson Reuters APRIL 17, 2013 n VOLUME 27 n ISSUE 19 | 19 LABOR AND PUBLIC EMPLOYMENT NEWS party’s duty of fair representation claim was STATE POLICE REPUDIATE CBA WITH meritless absent evidence indicating that the UNILATERALLY IMPOSED SERGEANT union’s conduct toward charging party was RESIGNATION REQUIREMENT arbitrary, discriminatory or in bad faith. Ruling: The state police was ordered to cease What it means: In considering the and desist from interfering with employees’ arguments raised by charging party in her exercise of guaranteed rights and to cease exceptions, MERC noted that the doctrine of refusing to bargain regarding the amendment collateral estoppel prohibits the litigation of to its operations manual to require Special an issue in a new action between the same Emergency Response Team members to parties or their privies when the original resign from SERT upon accepting a promotion WESTLAW JOURNAL case resulted in a final judgment and the to the rank of sergeant. issue in question was actually litigated and What it means: The unilateral change GOVERNMENT necessarily determined in the earlier matter. in terms and conditions of employment MERC explained that res judicata prohibits constituted a repudiation of the parties’ CONTRACT parties from retrying the same claim. collective bargaining agreement. Teamsters, Local 214 and Greer, 26 MPER Pennsylvania State Troopers Association This publication focuses on 43, 2013 WL 1324549 (Mich. Employment v. Pennsylvania State Police, 44 PPER 95, Relations Comm’n Feb. 26, 2013). litigation between private 2013 WL 1324568 (Pa. Labor Relations Bd. contractors and the federal H. Ex. Mar. 21, 2013). TOWNSHIP FAILS TO REBUT government arising out of EVIDENCE PROMOTION DECISION QUESTIONABLE DOCTOR’S NOTE contracts for the military WAS IMPROPERLY MOTIVATED ISN’T WILLFUL MISCONDUCT and the Department of Ruling: The Pennsylvania Labor Relations UNDER UNEMPLOYMENT STATUTE Defense. It also covers those Board sustained in part a township employer’s Ruling: The Unemployment Compensation entered into by various exceptions to a hearing examiner’s decision Board of Review properly determined that a reported at 44 PPER 65 (2012). The PLRB branches of government municipal tow truck operator was eligible for made absolute and final as amended and for construction, unemployment compensation benefits. The modified, the hearing examiner’s conclusion Pennsylvania Commonwealth Court declined communications and that the township violated Section 6(1)(a) to find that the operator’s provision of an computer systems, and and (c) of the Pennsylvania Labor Relations undated medical certificate, stamped with transportation. Disputes Act when it discriminated against a union the doctor’s name, address and telephone president by failing to promote the president between contractors member, violated the employer’s sick leave to the rank of lieutenant because of his and state and local policy for purposes of willful misconduct protected union activity. within the meaning of 402(e) of the governments are covered, What it means: In order to establish a prima Unemployment Compensation Law. primarily those involving facie case of discrimination, the complainant What it means: An employer relying discrimination in public must demonstrate not only that he was on willful misconduct as the basis for contracting. Rulings and engaged in protected activity and that the discharging an employee bears the burden filings in the U.S. Court of employer was aware of the protected activity, of demonstrating the existence of the but also that any adverse employment Federal Claims, the federal work rule and its violation. Only then does action was motivated by that protected district and circuit courts the burden shift to the employee to prove activity. Once that prima facie case has been that the deliberate violation of rules or the and the various Boards established, the burden of proof shifts to disregard of standards of behavior was of Contract Appeals are the employer to demonstrate a legitimate for good cause. Here, the claimant’s note featured. You’ll also find business reason for taking the complained-of substantially complied with the sick leave adverse action. coverage of litigation policy notwithstanding that it was not signed involving The False Claims Police Association of Falls Township v. Falls and dated, where the note indicated he was Township, 44 PPER 93, 2013 WL 1324567 under a doctor’s care and the dates coincided Act and its whistleblower (Pa. Labor Relations Bd. Mar. 19, 2013). with the time he missed work. provisions Philadelphia Parking Authority v. Unemployment Compensation Board of Call your West representative for more information Review, 44 PPER 96, 2013 WL 1324562 about our print and online subscription packages, or call 800.328.9352 to subscribe. (Pa. Commw. Ct. Mar. 13, 2013).

20 | WESTLAW JOURNAL n EMPLOYMENT © 2013 Thomson Reuters RECENTLY FILED COMPLAINTS FROM WESTLAW COURT WIRE* Damages Sought Writ of mandate, general, general, of mandate, Writ special and noneconomic benefits, damages, back pay, and costs fees, interest, $100,000 on two counts, $500,000 on one count, additional damages in the times of three the amount interest wages due, plus costs, fees and attorney $5 million plus costs $10 million, disbursements and costs and liquidated Actual and fees damages, costs exemplaryCompensatory, and damages, punitive penalty, and costs fees Allegations Teacher sought a writ of mandate against against a writ of mandate sought Teacher Unified Rivers School District Twin the teaching his former him to reinstate to and benefits position and back pay due based on the district’s his termination to him. against accusations false the Maryland violated Cars Motor Russel by Act and Collection Payment Wage, manager sales an Internet pay to failing bonusescommissions, and various benefits. employment with a plaintiff provide to failure CSX’s to plaintiff caused work environment safe in disorders trauma cumulative develop and ankles. his feet to failed Railroad Metro-North Commuter man of car plaintiff horn and warn blow to plaintiff causing train, an approaching and lacerations head rib fractures, sustain injury brain by traumatic being struck after the train. Service Chesapeake Systems Defendant by Act Labor Standards the Fair violated overtime wages for plaintiff pay to failing of 40 hours per in excess work performed week. the Fitness Ridge Malibu violated Act and Housing Employment Fair plaintiff’s terminating wrongfully by complaining for in retaliation employment male her co-worker, that management to and spa manager, therapist massage volatile guests in a sexually touch would way. Filing Date 02/07/13 03/29/13 03/29/13 04/01/13 04/1/13 04/2/13 Docket # Docket 34-2013- 80001431 24-C-13- 001857 24-C-13- 001766 1:13cv2148 2:13cv158 BC504567 Court Cal. Super. Ct. Ct. Super. Cal. (Sacramento) Ct. Md. Cir. (Baltimore) Ct. Md. Cir. (Baltimore) S.D.N.Y Va. E.D. Ct. Super. Cal. (L.A.) Case Name Slavich v. Twin Rivers Rivers Twin v. Slavich Unified School District Russel Lawson v. Inc. Cars Motor WL 1345925 2013 CSX Sisk v. Inc. Transportation WL 1313917 2013 Metro-North v. Tabin Railroad Commuter WL 1313859 2013 Chesapeake v. Hohorst Services Inc. System WL 1334745 2013 Fitness v. Sikkila Ridge Malibu LLC WL 1313907 2013

*Westlaw Court Wire is a Thomson Reuters news service that provides notice of new complaints filed in state and federal courts nationwide, sometimes within minutes of the filing.

© 2013 Thomson Reuters APRIL 17, 2013 n VOLUME 27 n ISSUE 19 | 21 RECENTLY FILED COMPLAINTS FROM WESTLAW COURT WIRE* $5 million, fees and costs $5 million, fees of $8 million in In excess compensatory damages, $5 damages, million in punitive damages, $5 million in treble and costs relief plus injunctive Compensatory and general damages, special damages, interest costs, relief, injunctive $250,000 in compensatory damages and $250,000 for and mental distress emotional interest anguish, plus costs, fees and attorney WordLogic Corp. demoted, harassed harassed demoted, Corp. WordLogic plaintiff discharged and constructively and he discovered after and CEO president fraud the substantial conceal to refused being perpetrated and ongoing fraud its former by the company against shareholder. and largest CEO president, of Internetwork employee A former committed ServicesConsulting LLC tortious of contract, interference, breach Vinsys Information against and conspiracy the violating knowingly Inc. by Technology letter acceptance of an employment terms plaintiff that a project to gain access to hiring the defendants, before had brought the and stealing directly the employee plaintiff. from project whistle- against retaliated Defendant of sexual complaints for plaintiff blower money of police and thefts harassment, supervisor’sdrug evidence, and former with the Hessianassociation Motorcycle transferred, demoted, gang. Defendant and harmed harassed pay, to refused making health for additionally plaintiff complaints. and safety University of Maryland System Medical with Disabilities Americans the violated supervisor when plaintiff’s Act threatened to work 12- refused her if she fire to her doctor and thereafter hour shifts than she work no more that recommended from she suffered because 8 hours a day arthritis. 04/2/13 04/2/13 04/4/13 04/4/13 1:13cv2181 CL-2013- 0006283 RIC1304016 24-C-13- 001905 S.D.N.Y Ct. Cir. Va. (Fairfax) Ct. Super. Cal. (Riverside) Ct. Md. Cir. (Baltimore) WordLogic Corp. v. Silverstein Corp. WordLogic WL 1313882 2013 Technology Vinsys Info. Ugrymov Inc. v. WL 1370670 2013 City v. Robinson of Riverside WL 1386934 2013 University v. Hayman of Maryland Medical Corp. System WL 1370690 2013

*Westlaw Court Wire is a Thomson Reuters news service that provides notice of new complaints filed in state and federal courts nationwide, sometimes within minutes of the filing.

22 | WESTLAW JOURNAL n EMPLOYMENT © 2013 Thomson Reuters RECENTLY FILED COMPLAINTS FROM WESTLAW COURT WIRE* Class Action Certification, Action Class unpaid wages, disbursements, and costs fees interest, and liquidated Compensatory, and damages, punitive fees interest $25 million in punitive fees, damages, interest, and costs disbursements than $600,000 in less Not compensatory damages, $10 damages, million in punitive plus interest relief, injunctive Class Action. Fisker Automotive ordered ordered Automotive Fisker Action. Class and closings or plant mass layoffs without cause its employees terminated written and without 60 days’ advance Worker of the in violation notification Notification and Retraining Adjustment Act. discriminated wrongfully Freight FedEx based on gender and plaintiff against a hostile creating by sexual harassment in terminated and was work environment complaint. of filing a retaliation The Financial Industry Regulatory plaintiff’s Authority downgraded on probation placed status, employment the he disclosed him after and terminated in the FINRA which allowed flaw system to circumvent firms brokerage large Security Commission and Exchange guidelines. leverage terminated psychiatrist Defendant without employment plaintiff’s his information him for compensating Riverview work at technology Psychiatric disclosed Medicine, and blatantly parties third to records medical plaintiff’s and Riverview with the intent employees on plaintiff. distress inflict emotional to 04/5/13 04/5/13 04/5/13 04/5/13 8:13cv540 1:13cv568 1:13cv2272 1:13cv2260 C.D. Cal. C.D. Ind. S.D. S.D.N.Y S.D.N.Y Automotive Inc. Fisker v. Etzelsberger Inc. Automotive WL 1397407 2013 FedEx Gilbert v. Inc. Freight WL 1369556 2013 Financial v. Sciddurlo Industry Regulatory WL Authority 2013 1365826 Pardell v. Bennett WL 1369538 2013

*Westlaw Court Wire is a Thomson Reuters news service that provides notice of new complaints filed in state and federal courts nationwide, sometimes within minutes of the filing.

Brooks v. Bechtel Corp. et al., No. A132926, 2013 WL 1205063 (Cal. Ct. App., 1st Dist., Div. 2 Mar. 26, 2013)...... 10 Document Section B...... 31

District Health Department No. 2 & Professional Management Association, 26 MPER 42, 2013 WL 1324548 Mich. Employment Relations Comm’n Feb. 26, 2013)...... 19

Equal Employment Opportunity Commission et al v. Western Trading Co. Inc., No. 10-2387, 2013 WL 1285653 (D. Colo. Mar. 7, 2013)...... 18

Equal Employment Opportunity Commission v. East Coast Waffles Inc., No. 13-525 (M.D. Fla. 2013)...... 18

Gear Automotive v. Acceptance Indemnity Insurance Co., No. 12-2446, 2013 WL 1092290 (8th Cir. Mar. 18, 2013)...... 16

Magic Laundry Services Inc. v. Workers United Service Employees International Union et al., No. 12-09654, 2013 WL 1409530 (C.D. Cal. Apr. 8, 2013)...... 14

McMaster v. J&J Snack Foods Sales Corp. et al., No. 13-1677, complaint filed, 2013 WL 1345445 (D.N.J. Mar. 19, 2013)...... 18

Muriithi et al. v. Shuttle Express et al., No. 11-1445, 2013 WL 1287859 (4th Cir. Apr. 1, 2013)...... 13

NEA, IEA, Illinois Eastern Community Colleges Association et al. & Illinois Eastern Community Colleges (Board of Trustees), No. 529, 29 PERI 136, 2013 WL 1235481 (Ill. Educ. Lab. Relations Bd. Jan. 24, 2013)...... 19

Oxford Health Plans LLC v. Sutter, No. 12-135, oral argument held (U.S. Mar. 25, 2013)...... 11

Parisi et al. v. Goldman Sachs & Co. et al., No. 11–5229–cv, 2013 WL 1149751 (2d Cir. Mar. 21, 2013)...... 1 Document Section A...... 25

Pennsylvania State Troopers Association v. Pennsylvania State Police, 44 PPER 95, 2013 WL 1324568 (Pa. Labor Relations Bd. H. Ex. Mar. 21, 2013)...... 20

Philadelphia Parking Authority v. Unemployment Compensation Board of Review, 44 PPER 96, 2013 WL 1324562 (Pa. Commw. Ct. Mar. 13, 2013)...... 20

Pietrowski v. Kintock Group, No. 111003328, verdict returned (Pa. Ct. Com. Pl., Phila. County Mar. 22, 2013)...... 8

Police Association of Falls Township v. Falls Township, 44 PPER 93, 2013 WL 1324567 (Pa. Labor Relations Bd. Mar. 19, 2013)...... 20

Republic Tobacco L.P. v. Ferraro et al., No. 1:13-CV-01639, complaint filed (N.D. Ill., E. Div. Mar. 4, 2013)...... 15 Document Section C...... 35

Service Employees International Union, Local 721 v. County of Riverside, 37 PERC 180, 2013 WL 1274553 (Cal. Public Employment Relations Bd. Mar. 1, 2013)...... 19

Siegel et al. v. Bloomberg LP, No. 13-CV-1351, 2013 WL 830805 complaint filed (S.D.N.Y. Feb. 26, 2013)...... 18

Somerset County Park Commission v. Teamsters, Local 469, 39 NJPER 110, 2013 WL 1235495 (N.J. Super. Ct. App. Div. Feb. 4, 2013)...... 19

Teamsters, Local 214 and Greer, 26 MPER 43, 2013 WL 1324549 (Mich. Employment Relations Comm’n Feb. 26, 2013)...... 20

United States v. eBay Inc., No. CV 12-5869, opposition brief filed (N.D. Cal., San Jose Div. Feb. 26, 2013)...... 9

Zhao v. Deutsche Bank AG, No. 13-2116, complaint filed, 2013 WL 1287358 (S.D.N.Y. Mar. 29, 2013)...... 18