Tuesday, March 31, 2009

W.Va. Supreme Court affirms $1 milion punitive award in retaliation case

A one million dollar punitive damages award was affirmed by the West Virginia Supreme Court of Appeals in Peters v. Rivers Edge Mining, Inc., No. 34272 (W.Va. Supr. Ct. March 27, 2009).  The plaintiff was fired from his job as a coal miner a few months after he filed a worker's compensation claim.  A Boone County jury found that he had been retaliated against in violation of W.Va. Code § 23-5A-1, et seq., and awarded him $1,855,107, including one million dollars in punitive damages.  The defendant employer appealed.

On appeal, the defendant argued (1) that his retaliation claims were preempted by federal labor law; (2) that collateral estoppel barred the claims; (3) that the front pay claim should not have been permitted to go to a jury, and (4) punitive damages should not have been awarded.  The West Virginia Supreme Court disagreed and affirmed the judgement.

Preemption
The employer claims the plaintiff, who was a member of the union, was fired for missing two consecutive days with no proof of sickness.  Pursuant to the CBA, his case was arbitrated, and the employer prevailed.  The employer argued that the retaliation claims later filed in circuit court were preempted by federal labor laws.

Hearkening back to its prior ruling in Yoho v. Triangle PWC, Inc., 175 W. Va. 556, 336 S.E.2d 204 (1985), the court held that worker's compensation retaliation claims are not preempted because such claims do not require the interpretation of a collective bargaining agreement for their resolution. See Syl. pt. 2, Yoho, 175 W. Va. 556, 336 S.E.2d 204 (“An action for wrongful termination under W. Va. Code § 23-5A-1 (1981) is not pre-empted by federal labor law.”).

New syllabus point:

"8. An action for wrongful termination under W. Va. Code § 23-5A-3 (1990) (Repl. Vol. 2005) is not pre-empted by federal labor law."

Collateral Estoppel
Next, the employer argued that because the arbitrator resolved factual issues pertaining to whether the plaintiff had violated the collective bargaining agreement's “two-day rule,” such rulings constituted a final determination on the merits, and the circuit court should not have allowed such issues to be relitigated during the trial in this case.

The Court, however, found that the two cases did not involve the same issue.  "[I]t is clear that the two litigations involve different central issues: the arbitration sought to resolve, under the collective bargaining agreement, whether Rivers Edge terminated Mr. Peters because he had violated the 'two-day rule' while the circuit court litigation sought to resolve, under our workers' compensation discrimination statutes, whether Rivers Edge's termination of Mr. Peters based upon his violation of the 'two-day rule' was pretextual."

Front Pay
The defendant first argued that the front pay award was improper because front pay is paid in lieu of reinstatement, and reinstatement was not an available remedy under our common law.  (The statute does not provide any particular remedy).

The Court found that reinstatement is indeed an available remedy, and so too is front pay:

11. An employee who asserts a claim alleging workers’ compensation discrimination in accordance with W. Va. Code § 23-5A-1, et seq., may recover damages for front pay in lieu of reinstatement. Whether the facts of a particular case warrant an award of front pay in lieu of reinstatement is a decision committed to the circuit court, and such a determination will be reviewed for an abuse of discretion. 

The court found that the award of front pay was supported by the evidence.

Punitive Damages
The remainder of the opinion reviewed the evidence supporting the punitive damages award.  The Supreme Court found there was ample evidence to support the award.  The jury was apparently not happy with the employer's decision to use surveillance to determine whether the employee was able to work.

Wednesday, March 18, 2009

Actual damages required for statutory damages award under Stored Communications Act, Fourth Circuit rules

In Van Alstyne v. Electric Scriptorium, Ltd., No. 07-1892 (4th Cir. Mar. 18, 2009) (PDF), the Fourth Circuit held that a plaintiff who proved her personal e-mail account was unlawfully accessed by her former employer was required to prove actual damages under the Stored Communications Act (SCA)  in order to sustain her statutory damages award.

After the Plaintiff left employment with the Defendant, she learned that her employer had accessed her personal America Online e-mail account and copied a number of e-mails.  She brought suit under the Stored Communications Act, 18 U.S.C.A. § 2707(a) (West 2000) ("SCA"), alleging that the employer illegally accessed her account. 

Following trial, a jury awarded her $150,000 in statutory damages and $75,000 in punitive damages against an individual defendant, and an additional $25,000 in statutory damages and $25,000 in punitive damages against the corporate defendant.  The district court also awarded her $135,723.56 in attorney’s fees and costs.

On appeal, the defendants claimed that the district court erred in permitting the jury to award: (1) statutory damages of $1,000 per violation of the SCA; (2) punitive damages; and (3) attorney’s fees, without first finding that the plaintiff suffered actual damages. 

Employing a "straightforward textual analysis" of the SCA, the Fourth Circuit agreed in part, concluding that plaintiffs pursuing claims under the SCA must prove actual damages in order to be eligible for an award of statutory damages. It disagreed, however, that this requirement holds for punitive damages or attorney’s fees.

Friday, March 06, 2009

Fourth Circuit affirms big FMLA verdict against Pfizer

In Dotson v. Pfizer, Inc., No. 07-1920 (4th Cir. March 4, 2009) (PDF), the Fourth Circuit affirmed in part, reversed in part, vacated in part, and remanded (in whole) a million dollar award in an FMLA interference and retaliation case.

The jury awarded compensatory damages of $333,305.25, and the District Judge added a like amount in liquidated damages, plus $389,264.88 in attorney fees and costs. Both parties appealed various rulings of the district court, and the Fourth Circuit gave some guidance in a number of areas on appeal.

Judge Cacheris, sitting by designation on a panel with Judge Motz and Judge Agee authored the unanimous opinion.

Facts

The plaintiff, Dotson, was Regional Manager for Pfizer who was terminated shortly after he and his wife returned from Russia with their newly-adopted child. Pfizer argued it fired Dotson for violating a company policy regarding distribution of drug “starter” packets of antibiotics, which Dotson delivered to the Russian orphanage as a gift. The jury found in favor of the Plaintiff.
Arguments

The Court sorted through a number of FMLA issues in affirming the jury’s verdict. Below are the arguments raised by Pfizer on appeal, and how the Court dealt with each:

Argument #1: The FMLA does not provide for the type of intermittent adoption-related leave that Dotson took.

Response: Adoption-related leave can be taken intermittently in some cases. The FMLA states that an employee cannot take adoption-related leave such leave intermittently "unless the employee and the employer . . . agree otherwise." 29 U.S.C. § 2612(b)(1).

There was no dispute Dotson requested leave for the purpose of going to Russia to adopt the child. There is also no dispute that Pfizer did not formally “agree” to allow him to take intermittent FMLA leave. However, Pfizer dropped the ball by not responding to the request and denying intermittent FMLA leave. “the FMLA does not require Dotson to specifically invoke its protections in order to benefit from it. … the requirement that employer and employee must ‘agree’ on intermittent leave does not clash with the generally-accepted position that no ‘magic words’ are necessary to invoke the protections of the FMLA. Pfizer could not point to any evidence showing that it refused to allow Dotson to take adoption-related leave intermittently.”

Argument #2: Because Dotson did not request FMLA leave, Pfizer can’t be liable for retaliation. (Essentially, Pfizer argued “how could we have retaliated against him for using FMLA leave when he never requested it, and we didn’t consider him to be using it?” -- A pretty good argument, I thought.)

Response: Not so fast. “Pfizer has not shown that it made any inquiry into whether his adoption-related leave should have been classified as protected under the FMLA. Pfizer’s legal argument would allow it to use its own failure to determine whether leave should be designated
as FMLA-protected to block liability for retaliation. We decline to allow an employer to take advantage of its own lapse in such a way.”

Argument #3: Dotson could not show retaliatory animus by the “higher-ups” who decided to
fire him.

Response: The record contained sufficient evidence of pretext: (1) Pfizer’s policies regarding starters were not so clearly drawn that Dotson’s handling of starters was obviously wrongful; (2) none of the Pfizer employees who knew in advance about Dotson’s plan to donate the starters— including his direct supervisor and a member of the executive group that fired Dotson— took any action to stop him from donating the starters; (3) the other two persons directly involved in obtaining the starters for Dotson were not disciplined.

Argument #4: Dotson’s FMLA interference claim should have been dismissed because he had no evidence of damages.

Response: Dotson incurred actual damages when he was asked to work while traveling to Russia on leave that should have been FMLA-protected — work for which Pfizer did not give him a full day’s credit. Had Pfizer treated the day Dotson spent working as a work day, rather than as paid vacation, Dotson would have been paid for an additional day of accrued vacation when he was terminated. A day’s paid vacation is not valueless.

Argument #5: Dotson was properly denied front pay.

Response: “[W]e do not believe the district court abused its discretion in denying Dotson front pay. At the time the court ruled on Dotson’s request for front pay, Dotson had secured full-time employment in the pharmaceutical services industry, making approximately $65,000 less than the approximately $232,000 in salary and benefits he made prior to his termination. Thus, he had secured comparable, if not precisely equivalent, work at another major drug company. … Considering that (1) the determination of front pay is inherently speculative; (2) Dotson was of a relatively young age when terminated; (3) he is highly educated and experienced; and (4) he sought front pay from the date of his termination until the date he claims he would have retired, fifteen years in the future, we cannot say that the district court abused its discretion in denying front pay.”

Also, “the [district] court’s consideration of liquidated damages in making Dotson whole was not an abuse of discretion.”

Argument #6: The District Court’s refusal to award pre-judgment interest was not error.

Response: “[P]rejudgment interest on FMLA damages is mandatory rather than discretionary. … Regardless of whether a court believes that a plaintiff is made whole by a jury award alone, the FMLA requires the award of pre-judgment interest.” The District Court erred in refusing to calculate it, even if the Plaintiff did not specifically request it in his post-trial motions.
Moral to the Story
Juries don’t like employers who fire employees who just adopted cute little Russian babies.
And if your reason for firing such employees is that they “improperly” delivered life-saving antibiotics to other cute little Russian babies, that's not going to help you out, either.
And, if you absolutely have to fire such employees, make sure there is no way the FMLA can possibly be construed to cover them--even if they never asked for FMLA leave.

Tuesday, March 03, 2009

More evidence that our legislators are just out of their minds

Bill takes Barbie to task
Legislation would make it unlawful to sell Barbie and similar dolls that promote or influence girls to place an undue importance on physical beauty to the detriment of their intellectual and emotional development.
Here's the link to HB 2918, in case you would like to read it yourself.

And of course, Delegate Blair wants everyone seeking public assistance to pee in a cup before they can get their food stamps.

West Virginia to adopt Virginia Code

Now here's a bill that the Chamber of Commerce can get behind:

H. B. 2424


(By Delegates Overington, J. Miller, Blair
Lane and Andes)
[Introduced February 16, 2009; referred to the
Committee on the Judiciary.]



A BILL to repeal the Code of West Virginia, 1931, as amended, and to adopt in lieu thereof, the Code of the Commonwealth of Virginia; and, providing that constitutional conflicts that may arise by the adoption of said code shall be addressed at the time they are identified.

Be it enacted by the Legislature of West Virginia:
THE CODE OF WEST VIRGINIA, 1931, AS AMENDED.
§1. Repeal of the Code of West Virginia, 1931, as amended.
The Code of West Virginia, 1931, as amended is hereby repealed and the Code of the Commonwealth of Virginia is hereby adopted in lieu thereof. In the event of conflicts with this State's Constitution that may arise with statutory provisions of the Commonwealth of Virginia, such conflicts shall be addressed as they may arise.


NOTE: The purpose of this bill is to repeal the Code of West Virginia, 1931, as amended, and to adopt in lieu thereof, the Code of the Commonwealth of Virginia. It also provides that constitutional conflicts that may arise by the adoption of said code shall be addressed at the time they are identified.