Sunday, March 16, 2014
Paul Secunda (Marquette), Scott Bauries (Kentucky), and Sheldon Nahmod (Chicago-Kent) have posted on SSRN their amicus brief in Lane v. Franks. Joshua Branson of Kellogg, Huber, Hanson, Todd, Evans & Figel also is an attorney of record on the brief, and more than sixty additional law professors signed on.
The case involves a public employee who was subpoenaed to testify in a fraud prosecution, and who alleged he was fired for truthfully testifying. The matter he testified about was information he had because of his work. The district court granted the defendant summary judgment, reasoning,
Mr. Lane’s testimony did not occur in the workplace, but he learned of the information that he testified about while working as Director at C.I.T.Y. Because he learned the information while performing in his official capacity as Director at C.I.T.Y., the speech can still be considered as part of his official job duties and not made as a citizen on a matter of public concern.
The Eleventh Circuit affirmed. The questions the Court granted cert on are: (1) Whether the government is categorically free under the First Amendment to retaliate against a public employee for truthful sworn testimony that was compelled by subpoena and was not a part of the employee’s ordinary job responsibilities; and (2) whether qualified immunity precludes a claim for damages in such an action.
For more on the case, see ScotusBlog here.
Wednesday, February 26, 2014
The EEOC has asked for public comments to its proposed revised management directive in federal sector proceedings. The EEOC acts as an adjudicator for federal sector claims. From the press release,
The U.S. Equal Employment Opportunity Commission (EEOC) has announced that it is seeking public comment on significant revisions to Management Directive 110 (MD-110), which provides federal agencies with EEO policies, procedures and guidance related to the newly revised 29 C.F.R. Part 1614 (federal sector EEO regulations). The full text of the proposed revisions is available on the Regulation.gov website at http://www.regulations.gov/#!docketDetail;D=EEOC-2014-0001.
These revisions represent the first major changes to MD-110 since 1999; they can be categorized into three areas:
- Implementation of Revised Regulations:
- new procedures for agencies to submit, and the EEOC to approve, requests to conduct pilot projects for processing complaints in ways other than those prescribed in Part 1614;
- revised procedure making an administrative judge's decision on the merits of a class complaint a final decision;
- a new compliance section;
- updated retaliation language in the dismissal section;
- notice to complainant when an agency is untimely in completing an investigation; and
- information on digital filings of appeals and complaint files.
- Conflict of Interest:
- addressing EEO director reporting relationship;
- EEO and HR conflicts;
- complaint processing of matters involving EEO officials or high-level agency officials; and
- conflicts between agency legal and EEO programs.
- General Updates & Clarification:
- revisions to the remainder of MD-110 to reflect current policies, procedures, laws and case precedents.
These revisions are a part of the EEOC's ongoing efforts to improve the federal sector process. The agency encourages interested parties to review these proposed changes and provide feedback for EEOC consideration. The agency specifically urges stakeholders to provide feedback on the conflict-of-interest section, as this is the EEOC's first attempt to provide clarity in this area, and stakeholder input will be valuable in determining the final approach.
Public comments on revisions to MD-110 should be provided through Regulation.gov (http://www.regulations.gov/#!docketDetail;D=EEOC-2014-0001) no later than April 25, 2014 for appropriate consideration.
Further information about EEOC is available on its website www.eeoc.gov. The EEOC's Office of Federal Operations also maintains a Twitter handle @EEOC_OFO for general news and information updates.
Thursday, February 20, 2014
The Departments of Labor, Treasury, and Health and Human Services have announced the publication of final regulations implementing a 90-day limit on waiting periods for employer provided health coverage.
The final regulations require that no group health plan or group health insurance issuer impose a waiting period longer than 90 days after an employee is otherwise eligible for coverage. The rules do not require coverage be offered to any particular individual or class of individuals, and it doesn't affect non-time-period conditions for eligibility, such as meeting certain sales goals, earning a certain level of commission, or successfully completing an orientation period. Requiring employees to complete a certain number of hours before becoming eligible for coverage is generally allowed as long as the requirement is capped at 1200 hours. The rules also address situations in which it cannot be determined that a new employee will be working full-time.
The departments are issuing a companion proposed rule for comment. That rule would limit the maximum duration of an otherwise permissible orientation period to one month. This proposal will be open for public comment. Comments must be filed by April 25, 2014.
Both the final and proposed rule are scheduled to be published on Monday, February 24, 2014.
Monday, December 16, 2013
According to Fedscoop, Seth Harris, Deputy Secretary of Labor for the last four-and-a-half years is stepping down to return to teaching, writing, and practice. Seth had been at NYLS before his appointment, but according to BNA's Daily Labor Report (241 DLR A-5), he will be remaining in the DC area. Thank you for your great work, Seth, I hope the DOL continues to benefit from your voice, and keep us all posted on your plans.
h/t Susan Bisom-Rapp (Thomas Jefferson)
Friday, December 13, 2013
Early yesterday morning, Chai Feldblum was re-confirmed to another 5-year term at the EEOC. Congratulations, and great news for the EEOC, which will remain fully staffed. Chai has been a great resource for the Commission, having been instrumental in negotiating the ADA and ADAAA, an expert on ENDA, and a voice for cooperation and public outreach with Commissioner Lipnic.
Tuesday, November 5, 2013
After years of no news, it looks like there is suddenly movement on the Employment Non-Discrimination Act. The current version, introduced in both the House (H.R. 1755) and the Senate (S. 815) on April 25th of this year, was voted out of committee in July and then had stalled, when Monday, the Senate overwhelmingly voted to invoke cloture and move forward to a vote. The Senate version is expected to pass as early as this week.
John Boehner has apparently said that he'll oppose the bill in the house, arguing that it will lead to frivolous litigation and hurt small businesses. Another frequent critique of the legislation is that it will interfere with religious freedom, although it does not apply to religious organizations that are allowed to discriminate on the basis of religion under Title VII.
Interestingly, according to polls, most people support a ban on LGBTQ discrimination, and in fact 80% of those polled think this protection already exists. There are certainly arguments that Title VII's ban on sex discrimination prohibits at least some discrimination on the basis of sexual orientation and identity (see here, here, and here for some of the EEOC's views supporting that). But the courts have not always agreed, and according to this infographic, only 21 states (and DC) have a ban on sexual orientation discrimination while 16 states (and DC) ban discrimination on the basis of gender identity.
Tuesday, October 15, 2013
Update: Thanks to blog reader, Albert Feuer, for bringing to my attention Tejinder Singh’s commentary on the oral argument, Argument analysis: Nobody seems worried about ERISA limitations periods, SCOTUSBLOG (Oct. 17, 2013).
OK, hold onto your seats for some flat out ERISA law excitement. This morning, the United States Supreme Court heard oral argument in Heimeshoff v. Hartford Life & Accidental Insurance Company [Briefs at SCOTUSblog], concerning statute of limitation accrual issues for benefit claims under Section 502(a)(1)(B) of ERISA.
RossRunkel.com, as always, gets to the heart of the matter (which is really impressive when you consider it is ERISA after all):
Heimeshoff's disability policy, administered by Hartford, says that a court suit for wrongful denial of benefits has to be filed within three years of when the claimant files a proof of loss with the plan administrator.
That can be tough, given the fact that it's possible for the three-year period to begin to run before the claimant has gone through the administrative procedure that must be followed before bring a suit. I suppose it's even possible in some cases that the three years would run out before the claimant got a final denial.
Hartford has a simple response, which is that ERISA plans usually get enforced the way they are written.
There's really no statutory text that's much help.
The petition for certiorari points out that lower court have adopted three conflicting approaches to answer the question of accrual:
(1) A plan’s statute of limitations cannot begin running until the claimant has exhausted administrative remedies and the plan has issued a formal, final adverse determination (Fourth and Ninth Circuits);
(2) A plan’s pre-denial statute of limitations is enforceable if “reasonable,” as determined on a case-by-case basis (Second, Sixth, Seventh, Eighth, and Tenth Circuits);and
(3) The plan must notify the claimant of the time limits for judicial review, in the SPD and adverse determinations, in compliance with ERISA regulations; and if it does not, the court will not allow the plan to assert the plan’s limitations defense or will equitably toll the limitations period (First Circuit and a District Court in Second Circuit).
I don't see any clear path for the Court on this one.
Also see Argument preview: When can an ERISA limitations period start to run? at SCOTUSblog.
I agree wth Ross that this area of ERISA law is a mess. The ERISA written plan requirement rule suggests that the plan administrator follow the terms of the plan as written, but to do so, at least conceivably in some cases, the administrator could drag their feet and wait for the statute of limitations to run before finally deciding the internal appeal and thereby prevent the employee to ever file a benefits denial claim in court.
Equitable tolling might be one way with dealing with the potential unfairness of the rule, but its implementation would also be messy. Also, it is unavailing to say with a straight face that plan administrators and employee should be bound by terms of the plan because if the employee wanted a different type of SOL they could just bargain for it. Everyone knows that employees don't bargain over plan language. They are classic adhesion contracts, presented on a take-it-or-leave-it basis.
To me, the best rule would be to start the SOL to run once the internal administrative process has been finalized and the employee is free to sue in court. This approach has the advantages of both providing a clear point when the SOL starts to run, plus provides incentive for the plan administrators to complete claims processing as quickly as possible.
No predictions on this one, folks, but I fear this pro-employer/pro-plan sponsor court will adopt the written plan requirement rule and permit the plan sponsor to unilaterally set in the plan document an accrual date and a length for the statute of limitations which will further undermine employee rights under ERISA.
Monday, September 23, 2013
Last week, the Securities and Exchange Commission (SEC) released a rule requiring companies to disclose the CEO-to-worker pay ratio. Despite objections by many corporations, the rule covers all employees including seasonal, international, and part-time workers. The SEC provides companies the option of using the entire workforce or a representative sample in the calculation.
There will now be a 60-day comment period. The SEC voted for the rule 3-2, with the two Republican Commissioners who voted against the proposal calling it a special interest provision and proclaiming “shame on the SEC.”
Proponents of the rule argue that it will give shareholders and other stakeholders a clear line of sight into human capital management and worker pay. For instance, CalPERS, the California State Pension Plan, has issued a release, welcoming the rule as a valuable tool which will “help shareholders to keep management accountable” and “shed light on an element of pay which is currently shrouded from view.” John Liu, the NYC Comptroller, stated that the rule would allow “shareowners to make informed decisions about compensation and may rein in excessive corporate practices.”
From my point of view, and quoting Justice Brandeis, "Publicity is justly commended as a remedy for social and industrial diseases. Sunlight is said to be the best of disinfectants; electric light the most efficient policeman."
Wednesday, September 18, 2013
The Employee Benefits Security Administration (EBSA) released today guidance (Technical Release 2013–04) defining the meaning of the terms “spouse” and “marriage” under ERISA in light of the U.S. Supreme Court's decision in June in U.S. v. Windsor.
Here is the pertinent text from the Technical Release:
In general, where the Secretary of Labor has authority to issue regulations, rulings, opinions, and exemptions in title I of ERISA and the Internal Revenue Code, as well as in the Department's regulations at chapter XXV of Title 29 of the Code of Federal Regulations, the term 'spouse' will be read to refer to any individuals who are lawfully married under any state law, including individuals married to a person of the same sex who were legally married in a state that recognizes such marriages, but who are domiciled in a state that does not recognize such marriages. Similarly, the term 'marriage' will be read to include a same-sex marriage that is legally recognized as a marriage under any state law....
The terms 'spouse' and 'marriage,' however, do not include individuals in a formal relationship recognized by a state that is not denominated a marriage under state law, such as a domestic partnership or a civil union, regardless of whether the individuals who are in these relationships have the same rights and responsibilities as those individuals who are married under state law.
DOL Secretary Thomas Perez suggests that the DOL plans to issue additional guidance in the near future.
Tuesday, June 25, 2013
Today the Supreme Court put another nail in the coffin of the withering body of consumer rights. In the American Express v. Italian Colors case, the Court furthered its trend that permits corporations to use arbitration to prevent consumers from challenging their unlawful conduct. The case arose when a group of merchants brought a class action against American Express alleging that the credit card company imposed on them an illegal tying arrangement, in violation of the antitrust law. The merchants' contracts with Amex contained a clause that required all disputes be subject to arbitration and that all disputes be arbitrated on an individual basis. It also prohibited parties from sharing the costs of any litigation or otherwise consolidating their legal claims. The merchants wanted to void the class action waiver and arbitrate as a group because it would cost many hundreds of thousands of dollars to mount an antitrust action yet the average recovery would be only $5000. Hence, they argued, without the ability to bring a class or collective action, they would lose their substantive rights. The Second Circuit agreed. It held that the class action ban could not be enforced "because to do so would grant Amex de facto immunity from antitrust liability by removing the plaintiffs' only reasonably feasible means of recovery."
The Second Circuit decision rested on an established Supreme Court precedent that says that under the Federal Arbitration Act, arbitration is only appropriate when it entails no loss of substantive rights. The Supreme Court first expressed this principle in 1985 in Mitsubishi Motors v. Solar Chrysler-Plymouth, a case in which a party was required to arbitrate a claim arising under the Sherman Antitrust Act. In Mitsubishi, the Court stated that arbitration could be ordered only if the litigant "may vindicate its statutory cause of action in the arbitral forum." The Court further explained that "[b]y agreeing to arbitrate a statutory claim, a party does not forgo the substantive rights afforded by the statute."
There is a lot more good analysis. You should read the whole thing.
Monday, June 24, 2013
The Supreme Court handed down opinions in two Title VII cases today, both of which will benefit employers. You should read both cases because they are really interesting. I'll just offer a general overview here.
First was Vance v. Ball State. In Vance, the Court considered who would be a supervisor for purposes of vicarious employer liability under Title VII. It held that only those employees empowered to take tangible employment action would be supervisors. Other employees with some supervisory authority are "merely" co-employees even if they are labeled supervisors by the employer. And an employer is liable for harassment by coworkers only if the employer is negligent in allowing the harassment to happen. The negligence inquiry must take into account the degree of authority and control the harasser had, and the greater the amount, the more likely the employer may be found negligent, as long as it also had constructive notice of that harassment. Thus, the Court reaffirmed the agency principles it had adopted in Farragher and Ellerth.
The second case was University of Texas Southwestern Medical Center v. Nasser. That case involved the causation standard for retaliation cases under Title VII. The Court held that plaintiffs had to prove that retaliation was the but-for cause of the adverse employment action taken against them, using the reasoning we are familiar with from Gross v. FBL Fin. Servs. The Court presumed that Congress incorporated the general tort causation standard in Title VII when it enacted the law, and the 1991 amendments which adopted the motivating factor standard used it in connection with discrimination on the basis of protected status and did not mention the word retaliation. The Court further relied on its decision in Gross, holding that if "because" meant but-for there, it must mean but-for in the retaliation context. Although the Court had previously held in Price Waterhouse that "because" could mean motivating factor or substantial factor, it said in this case that decision had no continuing effect. Congress essentially erased Price Waterhouse with the Civil Rights Act of 1991.
In both decisions, the Court rejected interpretations provided by the EEOC as unpersuasive, giving them no deference. Both decisions were decided 5-4, and Justice Ginsburg wrote the dissents for both. In both cases, Justice Ginsburg charged the majority with ignoring the realities of the workplace--the conditions under which people work--and of narrowing Title VII's protection well beyond what Congress had intended. She called on Congress to remedy both decisions.
My impression on reading both cases is that the decisions read as fairly instrumental, adopting highly technical statutory readings only when convenient and playing somewhat loose with prior precedent and lower court decisions. Clearly, the majority views Title VII cases as a problem for employers, a problem Congress must not have intended to cause, and a problem that the Court has to fix. I'm not sure that Justice Ginsburg's solution is workable, either. In the current climate, I would be surprised if Congress could do anything. And, it seems, no matter what Congress does, it seems that the Court has its own picture of what Congress should do. That motivated reasoning would be difficult to overcome even if the statute is amended. Consider what the Court did with the 1991 amendments. Instead of codifying the reasoning behind the causation analysis from Price Waterhouse, something Congress must have believed it was doing, those amendments were considered by the Court to have erased it completely.
Monday, June 10, 2013
The Supreme Court issued three opinions today, and among them was Oxford Health Plans LLC v. Sutter.
Here is the syllabus from the opinion:
Respondent Sutter, a pediatrician, provided medical services to petitioner Oxford Health Plans’ insureds under a fee-for-services contract that required binding arbitration of contractual disputes. He nonetheless filed a proposed class action in New Jersey Superior Court, alleging that Oxford failed to fully and promptly pay him and other physicians with similar Oxford contracts. On Oxford’s motion, the court compelled arbitration. The parties agreed that the arbitrator should decide whether their contract authorized class arbitration, and he concluded that it did. Oxford filed a motion in federal court to vacate the arbitrator’s decision, claiming that he had “exceeded [his] powers” under §10(a)(4) of the Federal Arbitration Act (FAA), 9 U. S. C. §1 et. seq. The District Court denied the motion, and the Third Circuit affirmed.
After this Court decided Stolt-Nielsen S. A. v. AnimalFeeds Int’l Corp., 559 U. S. 662—holding that an arbitrator may employ class procedures only if the parties have authorized them—the arbitrator reaffirmed his conclusion that the contract approves class arbitration. Oxford renewed its motion to vacate that decision under §10(a)(4). The District Court denied the motion, and the Third Circuit affirmed.
Held: The arbitrator’s decision survives the limited judicial review allowed by §10(a)(4). Pp. 4−9.
(a) A party seeking relief under §10(a)(4) bears a heavy burden. “It is not enough . . . to show that the [arbitrator] committed an error—or even a serious error.” Stolt-Nielsen, 559 U. S., at 671. Because the parties “bargained for the arbitrator’s construction of their agreement,” an arbitral decision “even arguably construing or applying the contract” must stand, regardless of a court’s view of its (de)merits. Eastern Associated Coal Corp. v. Mine Workers, 531 U. S. 57, 62. Thus, the sole question on judicial review is whether the arbitrator interpreted the parties’ contract, not whether he construed it correctly. Here, the arbitrator twice did what the parties asked: He considered their contract and decided whether it reflected an agreement to permit class proceedings. That suffices to show that he did not exceed his powers under §10(a)(4). Pp. 4−6.
(b) Stolt-Neilsen does not support Oxford’s contrary view. There, the parties stipulated that they had not reached an agreement on class arbitration, so the arbitrators did not construe the contract, and did not identify any agreement authorizing class proceedings. This Court thus found not that they had misinterpreted the contract but that they had abandoned their interpretive role. Here, in stark contrast, the arbitrator did construe the contract, and did find an agreement to permit class arbitration. So to overturn his decision, this Court would have to find that he misapprehended the parties’ intent. But §10(a)(4) bars that course: It permits courts to vacate an arbitral decision only when the arbitrator strayed from his delegated task of interpreting a contract, not when he performed that task poorly. Oxford’s remaining arguments go to the merits of the arbitrator’s contract interpretation and are thus irrelevant under §10(a)(4). Pp. 6−9.
675 F. 3d 215, affirmed.
KAGAN, J., delivered the opinion for a unanimous Court. ALITO, J., filed a concurring opinion, in which THOMAS, J., joined.
I'll admit to being a bit surprised at the outcome here. The language of prior decisions on arbitration suggested that the Court thought arbitration and class actions were incompatible and that contractual language would have to explicitly allow class actions in arbitration before they could go forward. The contractual language in this case was not that clear. The arbitrator in this case interpreted this arbitration clause as allowing class actions (just one of the universe of civil actions) to proceed in arbitration:
No civil action concerning any dispute arising under this Agreement shall be instituted before any court, and all such disputes shall be submitted to final and binding arbitration in New Jersey, pursuant to the rules of the American Arbitration Association with one arbitrator.
The rule on deferring to the arbitrator trumped what may be the majority of Justices' own view on class actions.
Friday, May 24, 2013
Congratulations to Chai Feldblum (EEOC, Georgetown) for her nomination to the EEOC for a second term. President Obama announced the nomination yesterday along with a group of other positions here. Given her extensive background on antidiscrimination issues in the legislative clinic at Georgetown and her central involvmement in drafting, coalition building, and passage of the ADA and ADAAA, Chai has been a very effective commissioner. She and Commissioner Lipnic, one of the President's Republican nominees, in particular have been able to work with business and employee advocates on enforcement issues. Here's hoping the Senate confirmation process goes smoothly this time around as well.
h/t Marcy Karin (Arizona State)
Wednesday, May 22, 2013
This past Friday, the United State Supreme Court granted cert. in the case of Lawson v. FMR LLC. The case concerns whether the Sarbanes-Oxley Act (SOX), which protects employees of publicly traded companies from retaliation for reporting financial improprieties, also protects the employees of private contractors of those companies. In the case, two fund investment advisors blew the whistle on a publicly-traded mutual fund which contracted for their services. The First Circuit found that the fund advisors were not covered by SOX protections.
The Court had asked the U.S. Solicitor General's views on the case, and the SG recommended that the Court bypass the case in order to allow the issue to percolate among more circuit courts. The case, however, was granted.
Among the issues to be decided: whether protecting the employees of contractors is mandated under the plain meaning of SOX and whether a finding of no coverage for such employees will discourage whistleblowers from bringing financial fraud allegations to the attention of the public. It should also be an interesting case because it is one of the first to examine the whistleblower protections of SOX and will likely provide guidance on how broadly or narrowly SOX should be interpreted to protect whistleblowers in the financial services industry.
Thursday, May 16, 2013
In addition to the Third Circuit's divided, pro-Noel Canning decision this morning which Jeff has described here in his post from today, Washington has been busy with labor-oriented topics.
To wit, the Senate Health, Education, Labor and Pensions (HELP) Committee held a hearing on the five recently nominated members for the National Labor Relations Board (NLRB) (Democrats Mark Gaston Pearce, Richard F. Griffin, and Sharon Block, and Republicans Harry I. Johnson and Philip A. Miscimarra). Surprisingly, the hearing lacked histrionics from either side, and a vote is planned by the Senate commitee next week on May 22nd. My prediction would be to expect a party line vote sending the nominations to the Senate floor, where, of course, a Republican filibuster should be expected. It will be interesting to see how the GOP justifies this filibuster given that its complaints about the Obama administration surround the use of the recess appointment power, and now Obama is given them the nominees they asked for in the first place. There is some urgency here because the Board will lack a quorum as of August 27th, when Chairman Pearce's term expires.
In other news, the Senate HELP committee voted today 12-10 along party lines to forward the nomination of Thomas Perez to be Secretary of Labor. Perez, who is exceptionally qualified to hold this position based on previous positions in federal and state government (he is the assistant attorney general in charge of the Justice Department's Civil Rights Division and he formerly headed Maryland's Department of Labor, Licensing and Regulation), has been under GOP attack for his purported role as assistant AG for civil rights. Not sure what the GOP will do on the Senate floor. They might have a hard time holding together a filibuster on this one, especially since their allegations against Perez appear to have turned out to be all smoke and no fire.
In any event, busy day today in Washington D.C. And I have feeling, the fireworks have just started.
Tuesday, May 7, 2013
There has been much conversation of late about the Noel Canning NLRB recess appointment decision and whether it is likely to be heard by the U.S. Supreme Court. In the meantime, many are urging the Senate to confirm a full package of NLRB nominees (3 Ds, 2 Rs as is traditional).
On this basis, Lynn Rinehart at the AFL-CIO is asking academics to support confirmation of all five NLRB nominees:
As you know, we face a growing crisis in the enforcement of workers’ rights in the wake of Noel Canning and the stalemate in the Senate over NLRB appointments.
The Senate Labor Committee will hold a hearing next Thursday, May 16, on the five nominees to the NLRB.
In connection with that hearing, Erin Johansson at American Rights at Work is coordinating an academic sign-on letter in support of confirmation of the five-member bi-partisan package.
We urge you to add your name to the letter. You can sign by visiting this page.
Thursday, April 18, 2013
Friend of the blog and comparative and international LEL expert, Susan Bisom-Rapp (Thomas Jefferson) has kindly provided the following guest post. It is an excellent analysis of this week's Supreme Court decision in Kiobel v. Royal Dutch Peltroleum. In it, she explains the labor and employment law ramifications of this important decision:
The Irony of the Supreme Court’s Decision in Kiobel v. Royal Dutch Petroleum
Susan Bisom-Rapp (Thomas Jefferson School of Law)
Although not a case involving workers’ rights, the April 17th decision in Kiobel v. Royal Dutch Petroleum was long-awaited by those interested in whether transnational corporations (TNCs) can be sued in U.S. courts under the Alien Tort Statute (ATS) for human rights violations perpetrated against foreign workers laboring abroad. Rather than answer the question initially directed to the Court – Does the ATS confer jurisdiction over corporations? – the Supreme Court addressed a different question: Whether and under what circumstances may U.S. courts recognize an ATS cause of action for violations occurring within another sovereign territory? In a fractured and somewhat muddy decision, the Court limited ATS cases, at least where the defendants are foreign corporations, the wrongdoing occurs outside the U.S., and the claims do not touch or concern the territory of the United States. Even so, the Court left open enough questions that on the day the decision issued, workers’ rights advocates confidently opined that there is still a subset of viable ATS cases that may be brought against TNCs.
Kiobel was brought by Nigerian nationals against Dutch, British, and Nigerian corporations, which the plaintiffs argued aided and abetted the Nigerian government in committing human rights abuses as the latter sought to suppress environmental protests related to corporate oil exploration. All nine justices agreed that the case should be dismissed but the four justices of the Court’s liberal wing (Justices Breyer, Ginsburg, Sotomayor, and Kagan) disagreed with the reasoning of the majority (Justices Roberts, Scalia, Kennedy, Thomas, and Alito). A liberal wing concurrence was consequently written. Complicating matters, Justices Kennedy and Alito each filed a separate concurrence, and Justice Thomas joined Justice Alito’s concurrence.
No matter how you slice it, the Supreme Court’s decision in Kiobel is a win for TNCs. The Kiobel case will not proceed, and the Court announced new limitations on ATS claims. Ironically, however, and despite the limitations imposed by the Kiobel majority, it is the majority opinion, written by Chief Justice Roberts, which leaves the courthouse door open a bit and will likely be used by workers’ rights advocates in subsequent litigation. Before explaining why, some background on ATS claims on behalf of workers is necessary.
The ATS, legislation enacted in 1789 and signed into law by George Washington, confers federal jurisdiction over “any civil action by an alien for a tort only, committed in violation of the law of nations or a treaty of the United States.” It was not until 1996, however, that suit was brought against a corporate defendant. That case involved the oil company Unocal, which was sued for allegedly aiding and abetting abuses by the Myanmar military, including the use of forced labor, committed in connection with the construction of a natural gas pipeline. Although that case settled, subsequent ATS cases brought on behalf of workers include suits against: Bridgestone-Firestone on behalf of children and adults who work on Firestone’s rubber plantation in Liberia; Chiquita by the families of pro-union workers murdered by Colombian paramilitaries; Coca-Cola for the murder and torture of Colombian union leaders; Nestle, Archer Daniels Midland, and Cargill relating to the trafficking of Malian children into Cote d’Ivoire for work on cocoa plantations; and mining company Drummond, regarding its subsidiary’s alleged involvement with the torture and murder of Colombian trade union leaders.
In 2007, that last case, Romero v. Drummond Co., Inc., became the first ATS case against a corporation to reach trial. Although the jury ruled against the plaintiffs, many TNCs and their advocates viewed the case as making real what had until then been a theoretical threat of corporate ATS liability. The status of corporate ATS liability, however, is contested. There is a split in the circuits that the Supreme Court had a chance to resolve in Kiobel. Rather than do that directly, the Court addressed a different issue – the extra-territorial reach of the ATS in suits brought against any person, natural or juridical.
For the Kiobel majority, this is a simple case resolved by the presumption against extraterritorial application of a statute. That well-known presumption provides that where Congress has not plainly expressed its intent that legislation apply beyond U.S. borders, the statute does not apply extraterritorially. Since the spare text of the ATS does not address the reach of the grant of federal jurisdiction for tort claims brought by aliens, the presumption, by barring claims such as those in Kiobel, precludes U.S. courts from creating conflicts with other nations and interfering with foreign policy. That the tort claims mentioned in the ATS are those “committed in violation of the law of nations” does not, argued the majority, imply reach beyond our borders since violations of international law norms can occur on U.S. soil. Indeed, two embarrassing incidents involving foreign ambassadors to the U.S. occurred just prior to passage of the ATS. At the time, U.S. officials were concerned there might not be a sufficient forum for hearing those claims.
As for what it would take to displace the presumption, Chief Justice Roberts notes that all ATS claims must “touch and concern” U.S. territory with “sufficient force.” Somewhat tantalizing, he opines that “[c]orporations are often present in many countries, and it would reach too far to say that mere corporate presence suffices.” Picking up on all that the majority opinion leaves unanswered, Justice Kennedy’s one paragraph concurrence notes that “the Court is careful to leave open a number of significant questions regarding the reach and interpretation of the [ATS].”
Rather than embrace the presumption against extraterritorial application, the liberal wing’s concurrence is driven by the principles of foreign relations law from which it draws international jurisdictional norms to determine when it is appropriate to apply U.S. law outside of U.S. territory. To that end, Justice Breyer, who wrote the concurrence, relies on the Restatement (Third) of Foreign Relations Law. The liberal concurrence argues that the statute provides federal district courts with jurisdiction not only when the torts occur in the U.S. but also when “the defendant is an American national” or “the defendant’s conduct substantially and adversely affects an important American national interest.”
While providing some useful language for workers’ rights advocates, there are two reasons I believe the liberal concurrence may be less helpful to them than the majority opinion coupled with Justice Kennedy’s concurrence. First, there may be a tendency among American judges to shy away from foreign relations law and the Restatement Third when they might easily make use of a presumption rooted in domestic law, and, I might add, that presumption is embedded in a majority opinion. Strategically, it may make sense for workers’ rights advocates to craft arguments using language that is familiar to American judges.
Second, Justice Breyer's example of “an important American national interest” does not track the fact patterns of the ATS corporate cases very well. His example is ensuring our country does not become a safe harbor for modern day pirates – those who commit heinous violations of international norms elsewhere and then seek safety on our shores. In the corporate ATS cases, the actual commission of human rights violations is rarely performed by the TNC in question. Gross human rights abuses in those cases usually have a direct connection to a foreign government. The corporate liability, if it were to lie, is vicarious. In short, the ill-fit of Justice Breyer’s example may limit the utility of the liberal concurrence leading to the irony that the more conservative majority opinion may ultimately be of greater use to workers’ rights advocates. The Kiobel decision was a disappointment for workers’ rights advocates but it was not as bad a decision as it could have been. The battle over corporate ATS liability continues, at least for now.
Monday, March 18, 2013
The Supreme Court today granted cert in Madigan v. Levin, an ADEA case from the 7th Circuit. Here is the issue:
Whether the Seventh Circuit erred in holding, in an acknowledged departure from the rule in at least four other circuits, that state and local government employees may avoid the federal Age Discrimination in Employment Act’s comprehensive remedial regime by bringing age discrimination claims directly under the Equal Protection Clause and 42 U.S.C. § 1983.
Tuesday, February 5, 2013
Michael Zimmer (Loyola-Chicago) and Sandra Sperino (Cincinnati) are currently drafting an amicus brief to be filed in University of Texas Southwestern Medical Center v. Nassar. This case addresses mixed motive issues in Title VII retaliation cases, and it is a pretty important issue. Michael and Sandra are interested in hearing from anyone who would like to comment on drafts of the amicus or who would be interested in signing or considering signing on to the finished brief. Please email Sandra at email@example.com if interested.
Kenneth Shiotani (National Disability Rights Network) gives us the news that the Department of Labor will be publishing its final rule on the recent amendments to the FMLA that expanded coverage to flight crews and family members of those in the military--for a refresher on those expansions, see here, here and here.
February 5, 2013 in Beltway Developments, Disability, Employment Discrimination, Labor and Employment News, Pension and Benefits, Public Employment Law, Worklife Issues | Permalink | Comments (0) | TrackBack (0)