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• TAX - NON-PHYSICAL PERSONAL INJURY

• RETALIATION - ADVERSE EMPLOYER ACTION

• RETALIATION - FIRST AMENDMENT

• STATUTE OF LIMITATIONS - PERIODIC PAYCHECKS

• JURISDICTION - NUMBER OF EMPLOYEES

• PROOF - "BOY" - COMPARATIVE QUALIFICATIONS

• DISPARATE IMPACT - BURDEN OF PROOF

• RICO - EMPLOYEE v. EMPLOYER

• ERISA - SUIT FOR "EQUITABLE" RELIEF

• ERISA - PREEMPTION OF "BIG BOX" LAWS

• RELIGION - THE "MINISTERIAL EXCEPTION"

• CLASS ACTION FAIRNESS ACT - LESS MEANS MORE

• FLSA - WALKING AND WAITING TIME

• 42 USC § 1981 - STANDING

TAX - NON-PHYSICAL PERSONAL INJURY

Murphy v. Internal Revenue Service, ___ F.3d ___ (DC Cir 08/22/2006)

Facts: A DOL administrative law judge awarded Murphy damages from her employer on a whistleblower claim. The ALJ specified that part of the award was for "emotional distress or mental anguish," and part was for "injury to professional reputation." Murphy paid taxes on the award, and then sued IRS seeking a tax refund.

Statute: Internal Revenue Code § 104(a)(2): "gross income [under IRC § 61] does not include ... the amount of any damages (other than punitive damages) received (whether by suit or agreement and whether as lump sums or as periodic payments) on account of personal physical injuries or physical sickness" and "emotional distress shall not be treated as a physical injury or physical sickness."

Statutory holding: The compensation was not "received on account of personal physical injuries," and therefore § 104 does not permit Murphy to exclude her award from income.

Sixteenth Amendment: "The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration."

Constitutional holding: § 104, as applied to Murphy, is unconstitutional.

The DC Circuit used a two-part constitutional test:

1. Under the 16th amendment, Congress has the power to tax only "gain[s]" or "accessions to wealth." Commissioner v. Glenshaw Glass, 348 US 426 (1955). The money Murphy received was neither a "gain" nor an "accession to wealth."

Key quote: "[T]he damages were awarded to make Murphy emotionally and reputationally 'whole' and not to compensate her for lost wages or taxable earnings of any kind. The emotional well-being and good reputation she enjoyed before they were diminished by her former employer were not taxable as income. Under this analysis, therefore, the compensation she received in lieu of what she lost cannot be considered income ...."

2. The "original understanding" of the framers of the 16th amendment was that they "would not have understood compensation for a personal injury - including a nonphysical injury - to be income."

RETALIATION - ADVERSE EMPLOYER ACTION

Burlington Northern v. White, 126 S.Ct. 2405 (06/22/2006)

Facts: A jury found that White's employer retaliated against her for complaining about sex discrimination. There were two acts of retaliation under Title VII § 704:

1. White was working as a fork lift operator, and the employer moved her to a job as a standard track laborer. Both assignments were within her job description.
2. Later, the employer suspended White without pay for 37 days. After she filed a grievance, the employer reinstated her and gave her full back pay. The reinstatement followed from procedures in the collective bargaining agreement.

Statutes: "It shall be an unlawful employment practice for an employer

Held: Both employer actions were prohibited retaliatory actions under § 704.

Key quote: "We conclude that the anti-retaliation provision does not confine the actions and harms it forbids to those that are related to employment or occur at the workplace. We also conclude that the provision covers those (and only those) employer actions that would have been materially adverse to a reasonable employee or job applicant. In the present context that means that the employer's actions must be harmful to the point that they could well dissuade a reasonable worker from making or supporting a charge of discrimination."

• The retaliatory action need not cause financial loss.
  
  
• The retaliatory action need not occur at the workplace.

Examples: Rochon v. Gonzales, 438 F.3d 1211 (DC Cir 2006) (FBI retaliation against employee "took the form of the FBI's refusal, contrary to policy, to investigate death threats a federal prisoner made against [the agent] and his wife"); Berry v. Stevinson Chevrolet, 74 F.3d 980 (10th Cir 1996) (finding actionable retaliation where employer filed false criminal charges against former employee who complained about discrimination).

• The actions must be "materially adverse" - "harmful to the point that they could well dissuade a reasonable worker from making or supporting a charge of discrimination."

"The anti-retaliation provision seeks to prevent employer interference with 'unfettered access' to Title VII's remedial mechanisms. Robinson v. Shell Oil Co., 519 U. S. 337, 346 (1997). It does so by prohibiting employer actions that are likely 'to deter victims of discrimination from complaining to the EEOC,' the courts, and their employers. Ibid. And normally petty slights, minor annoyances, and simple lack of good manners will not create such deterrence."

• The action is viewed from the perspective of the reasonable employee.

"A schedule change in an employee's work schedule may make little difference to many workers, but may matter enormously to a young mother with school age children. Cf., e.g., Washington v. Illinois Dept. of Revenue, 420 F. 3d 658, 662 (7th Cir 2005) (finding flex-time schedule critical to employee with disabled child)."

"A supervisor's refusal to invite an employee to lunch is normally trivial, a nonactionable petty slight. But to retaliate by excluding an employee from a weekly training lunch that contributes significantly to the employee's professional advancement might well deter a reasonable employee from complaining about discrimination."

Later cases: Moore v. City of Philadelphia, ___ F.3d ___ (3rd Cir 08/30/2006) (discipline allegedly more sever than normal; threat, assault, transfer; pattern of harassment); Kessler v. Westchester County Department of Social Services, ___ F.3d ___ (2nd Cir 08/23/2006) (transfer with reduced responsibilities raised factual issue on whether the change was "materially adverse"); Randolph v. Ohio Dept. of Youth Services, 453 F.3d 724 (6th Cir 07/13/2006) (administrative leave, then discharge, then reinstatement with less than full back pay).

RETALIATION - FIRST AMENDMENT

Garcetti v. Ceballos, 126 S.Ct. 1951 (05/30/2006) (5-4)

Facts: Ceballos, a supervising deputy district attorney, concluded that a search warrant affidavit made serious misrepresentations. He relayed his findings to his supervisors and followed up with a disposition memorandum recommending dismissal. His supervisors nevertheless proceeded with the prosecution. At a hearing on a defense motion to challenge the warrant, Ceballos recounted his observations about the affidavit, but the trial court rejected the challenge. Claiming that his supervisors then retaliated against him for his memo in violation of the First and Fourteenth Amendments, Ceballos filed a 42 USC § 1983 suit.

Held: When public employees make statements pursuant to their official duties, they are not speaking as citizens for First Amendment purposes, and the Constitution does not insulate their communications from employer discipline.

Key quote: "The controlling factor in Ceballos' case is that his expressions were made pursuant to his duties." "We hold that when public employees make statements pursuant to their official duties, the employees are not speaking as citizens for First Amendment purposes, and the Constitution does not insulate their communications from employer discipline."

Later cases: Reuland v. Hynes, ___ F.3d ___ (2d Cir 08/21/2006) (assistant DA's false statement to newspaper was protected); Fuerst v. Clarke, 454 F.3d 770 (7th Cir 07/27/2006) (deputy sheriff was speaking in his capacity as a union representative rather than as a deputy sheriff); Hill v. Borough of Kutztown, 455 F.3d 225 (3rd Cir 07/26/2006) (borough manager's complaints to borough council regarding the mayor: some unprotected, some cannot be determined on a 12(b)(6) motion); Bailey v. Dept of Elementary & Secondary Educ, 451 F.3d 514 (8th Cir 06/23/2006) (consultant (contractor) complained to supervisor and Commissioner; speech primarily concerned consultant's own interests and "as an employee concerned with being paid for his time"); Mills v. City of Evansville, 452 F.3d 646 (7th Cir 06/20/2006) (police sergeant's statement to managers that the police chief's staffing plan would not work was unprotected).

STATUTE OF LIMITATIONS - PERIODIC PAYCHECKS

Ledbetter v. Goodyear Tire & Rubber (Pending - US Supreme Court)

Docket No. 05-1074.   Oral argument scheduled for __________.
Decision below: Ledbetter v. Goodyear Tire & Rubber, 421 F.3d 1169 (11th Cir 08/23/2005)

Facts: Ledbetter claimed that, because of her sex, her employer paid her a smaller salary than it paid male co-workers. Her periodic paychecks were based on annual salary reviews. A jury awarded damages to Ledbetter based on a series of salary decisions going back 19 years. The 11th Circuit reversed and ordered that Ledbetter's complaint be dismissed.

Statute: Title VII § 706(e)(1): "A charge under this section shall be filed within one hundred and eighty days after the alleged unlawful employment practice occurred ...."

Holding - 11th Circuit: The claim was time barred because Ledbetter could not prove intentional discrimination in either (1) the one decision during the  limitations period or (2) the last decision preceding the limitation period.

Key quote - 11th Circuit: "We conclude that in the search for an improperly motivated, affirmative decision directly affecting an employee's pay, the employee may reach outside the limitations period created by her EEOC charge no further than the last such decision immediately preceding the start of the limitations period. We do not hold that an employee may reach back even that far; what we hold is that she may reach no further."

Formal statement of the issue in the Supreme Court: "Whether and under what circumstances a plaintiff may bring an action under Title VII of the Civil Rights Act of 1964 alleging illegal pay discrimination when the disparate pay is received during the statutory limitations period, but is the result of intentionally discriminatory pay decisions that occurred outside the limitations period."

JURISDICTION - NUMBER OF EMPLOYEES

Arbaugh v. Y&H Corp, 126 S.Ct. 1235 (02/22/2006)

Facts: Arbaugh sued her former employer under Title VII and related state law claims. A jury returned a verdict in her favor. After the trial court entered judgment on that verdict, Y&H moved to dismiss the entire action for want of federal subject-matter jurisdiction, asserting, for the first time, that it had fewer than 15 employees on its payroll and therefore was not amenable to suit under Title VII.

Statute: Title VII § 701(b): "The term 'employer' means a person engaged in an industry affecting commerce who has fifteen or more employees ...."

Held: Title VII's numerical threshold does not circumscribe federal-court subject-matter jurisdiction. Instead, the employee-numerosity requirement relates to the substantive adequacy of Arbaugh's Title VII claim, and therefore could not be raised defensively late in the lawsuit, i.e., after Y&H had failed to assert the objection prior to the close of trial on the merits.

Later cases: The same result under other statutes: Minard v. ITC Deltacom, 447 F.3d 352 (5th Cir 04/18/2006) (FMLA); Cobb v. Contract Transport, 452 F.3d 543 (6th Cir 06/28/2006) (FMLA); Fernandez v. Centerplate/NBSE, 441 F.3d 1006 (DC Cir 03/24/2006) (FLSA).

PROOF - "BOY" - COMPARATIVE QUALIFICATIONS

Ash v. Tyson Foods, 126 S.Ct. 1195 (02/21/2006)

Facts: Two African-American superintendents were denied promotions. There was evidence that the plant manager (the decisionmaker) referred to each of the employees as "boy." The 11th Circuit held that use of "boy" alone (without adding "white" or "black") was not evidence of racial animus. The employees submitted evidence that their qualifications were better than the two whites that were promoted, but the 11th Circuit rejected this as evidence of pretext.

Held (1): "Boy," standing alone, may or may not evidence racial animus.

Key quote: "Although it is true the disputed word will not always be evidence of racial animus, it does not follow that the term, standing alone, is always benign. The speaker's meaning may depend on various factors including context, inflection, tone of voice, local custom, and historical usage. Insofar as the Court of Appeals held that modifiers or qualifications are necessary in all instances to render the disputed term probative of bias, the court's decision is erroneous."

Later cases: Ash v. Tyson Foods  (11th Cir 08/02/2006) (unpublished) (adhering to original decision); Canady v. Wal-Mart Stores, 440 F.3d 1031 (8th Cir 03/17/2006) (2-1) (evidence did not support finding of harassment; "slave driver" was used to describe manger's reputation; employee did not complain about manager saying "what's up my nigga" and manager apologized).

Held (2): The following 11th Circuit formula is error: "Pretext can be established through comparing qualifications only when 'the disparity in qualifications is so apparent as virtually to jump off the page and slap you in the face.'"

Key quote: "The visual image of words jumping off the page to slap you (presumably a court) in the face is unhelpful and imprecise as an elaboration of the standard for inferring pretext from superior qualifications."

Later cases: Ash v. Tyson Foods (11th Cir 08/02/2006) (unpublished) (adhering to original decision); Brooks v. County Commission, 446 F.3d 1160 (11th Cir 04/18/2006) ("disparities in qualifications must be of such weight and significance that no reasonable person, in the exercise of impartial judgment, could have chosen the candidate selected over the plaintiff for the job in question," following Cooper v. Southern Co., 390 F.3d 695 (11th Cir 2004)); Mlynczak v. Bodman, 442 F.3d 1050 (7th Cir 04/04/2006) ("essentially the same as" the Cooper standard); Bender v. Hecht Dept Stores, 455 F.3d 612 (6th Cir 08/01/2006) (qualifications evidence must be combined with other evidence of discrimination).

5th Circuit: Price v. Federal Express, 283 F.3d 715 (5th Cir 2002) (qualifications must "leap from the record and cry out to all who would listen that [the plaintiff] was vastly - or even clearly - more qualified for the subject job.")

DISPARATE IMPACT - BURDEN OF PROOF

IBEW v. Mississippi Power & Light, 442 F.3d 313 (5th Cir 03/02/2006)

Facts: The union demonstrated that the employer had an employment practice that had a disproportionate impact on African-Americans. The practice was the method of setting cutoff scores for a validated standardized test. The employer demonstrated that its practice was both "job related" and "consistent with business necessity." Neither party made a showing that there was, or was not, an alternative selection device that would have a lesser racial impact and also serve the employer's legitimate interest.

Statute: Title VII § 703(k)(A) [CRA of 1991]: "An unlawful employment practice based on disparate impact is established ... only if --

"(i) a complaining party demonstrates that a respondent uses a particular employment practice that causes a disparate impact on the basis of race, color, religion, sex, or national origin and the respondent fails to demonstrate that the challenged practice is job related for the position in question and consistent with business necessity; or

"(ii) the complaining party makes the demonstration described in subparagraph (C) with respect to an alternative employment practice and the respondent refuses to adopt such alternative employment practice."

Held: The burden of proof (persuasion) is on the plaintiff.

Related cases: Two placed the burden on the plaintiff: Lanning v. Southeastern Penn Trans Auth, 181 F.3d 478 (3rd Cir 1999); Fitzpatrick v. City of Atlanta, 2 F.3d 1112 (11th Cir 1993). One placed the burden on the employer: Bradley v. Pizzaco of Nebraska, 7 F.3d 795 (8th Cir 1993).

RICO - EMPLOYEE v. EMPLOYER

Mohawk Industries, Inc v. Williams, 126 S.Ct. 2016 (06/05/2006)

Facts: Hourly employees and former employees alleged that the employer's widespread and knowing employment and harboring of illegal workers allowed the employer to depress wages for its legal hourly employees and to discourage workers compensation claims - all in violation of the federal RICO statute. The trial court denied the employer's motion to dismiss; the 11th Circuit affirmed.

Arguments in the Supreme Court: Plaintiffs alleged that the employer (a corporation) was part of a separate RICO "enterprise" made up of a combination of the employer plus recruiting agencies, with a common purpose of hiring and harboring illegal workers. The key issue during the Supreme Court arguments was whether a corporation can be part of a RICO "association-in-fact" separate "enterprise." (The 11th Circuit concluded that the "enterprise" is the association-in-fact between the employer and the third-party recruiters.)

Held: The Supreme Court sidestepped the issue that consumed most of the briefs and oral argument. The decision:

"PER CURIAM. The writ of certiorari limited to Question 1 presented by the petition, granted at 546 U. S. ___ (2005), is dismissed as improvidently granted. The petition for a writ of certiorari is granted. The judgment is vacated, and the case is remanded to the United States Court of Appeals for the Eleventh Circuit for further consideration in light of Anza v. Ideal Steel Supply Corp [126 S.Ct. 1991 (06/05/2006)]."

In the Anza case the Supreme Court's focus was on whether the plaintiff had properly alleged that the defendant's RICO violation was the proximate cause of the plaintiff's injury, which requires "some direct relation between the injury asserted and the injurious conduct alleged." Plaintiff and defendant were competitors. Claim #1 was that defendant filed false tax returns by mail (violating RICO) to conceal its failure to charge tax to cash customers, allowing it to reduce prices, which caused plaintiff to lose sales. Held: No proximate cause. Claim #2 was that defendant used illegal income to open a new store, which caused loss of business. Held: Remanded on proximate cause issue.

ERISA - SUIT FOR "EQUITABLE" RELIEF

Sereboff v. Mid Atlantic Medical Services, 126 S.Ct. 1869 (05/15/2006)

Facts: The Sereboffs were injured in a traffic accident, and their ERISA plan paid their medical expenses of about $75,000. Later, the Sereboffs recovered about $750,000 in a settlement from a third party. The ERISA plan had an "Acts of Third Parties" provision which requires a beneficiary who is injured as a result of an act or omission of a third party to reimburse the plan for benefits it pays on account of those injuries, if the beneficiary recovers for those injuries from the third party. The plan sued under ERISA § 502(a)(3), seeking to collect from the Sereboffs' tort recovery the medical expenses it had paid on the Sereboffs' behalf. The Sereboffs agreed to set aside from their tort recovery a sum equal to the amount the plan claimed, and preserve this sum in an investment account pending the outcome of the suit.

Statute: A fiduciary may bring a civil action under § 502(a)(3)(B) "to obtain … appropriate equitable relief … to enforce … the terms of the plan."

Held: The plan's suit properly sought "equitable relief" under § 502(a)(3).

The Court distinguished Great-West Life & Annuity Ins. Co. v. Knudson, 534 U.S. 204 (2002), which involved a provision in an ERISA plan similar to the "Acts of Third Parties" provision in the Sereboffs' plan. Relying on such a provision, Great-West sought equitable restitution of benefits it had paid when Knudson recovered in tort from a third party. In considering whether § 502(a)(3)(b) authorized such relief, the Court asked whether the restitutionary remedy Great-West sought would have been equitable in "the days of the divided bench." The Court found that it would not have been equitable, because the funds Great-West sought were not in Knudson's possession but had been placed in a trust under California law. In contrast, in the Sereboff case the plan sought identifiable funds within the Sereboffs' possession and control - that part of the tort settlement due to the plan and set aside in the investment account.

Later cases: Moore v. CapitalCare, ___ F.3d ___ (DC Cir 08/29/2006) (plan can recover even though beneficiary was not fully made whole); Popowski v. Parrott, ___ F.3d ___ (11th Cir 08/24/2006) (two separate cases in which plans sought reimbursement; Case #1 sought equitable relief because the participant agreed to a lien on identifiable funds; Case #2 did not seek equitable relief because the plan sought relief from the beneficiary's general assets); Coan v. Kaufman, ___ F.3d ___ (2nd Cir 07/21/2006) (plan participant's suit against trustees alleging breach of fiduciary duty did not seek equitable relief); Dillard's Inc v. Liberty Life Assurance, ___ F.3d ___ (8th Cir 07/19/2006) (reimbursement claim for overpayments resulting from payment of social security benefits sought equitable relief); LaRue v. DeWolff, Boberg & Assoc, 450 F.3d 570 (4th Cir 06/19/2006) (401(k) plan participant's § 1132(a)(3) suit against plan administrator alleging failure to follow investment instructions was not seeking equitable relief).

ERISA - PREEMPTION OF "BIG BOX" LAWS

Retail Industry Leaders Association v. Fielder, 435 F.Supp.2d 481 (District of Maryland 07/19/2006).

State statute: Maryland Fair Share Health Care Fund Act requires that a for-profit employer with 10,000 or more employees in the state that "does not spend up to 8% of the total wages paid to employees in the State on health insurance costs shall pay to the Secretary an amount equal to the difference between what the employer spends for health insurance costs and an amount equal to 8% of the total wages paid to employees in the State." The Act defines "health insurance costs" as "the amount paid by an employer to provide health care or health insurance to employees in the State to the extent the costs may be deductible by an employer under federal tax law."

ERISA: § 514(a) preempts "any and all State laws insofar as they may now or hereafter relate to any employee benefit plan" covered by ERISA.

Held: The Maryland statute "has a connection with an ERISA plan and is preempted on that ground."

Key quote: "In determining whether a statute has a 'connection with' an ERISA plan, a court must look to (1) 'the objectives of the ERISA statute as a guide to the scope of the state law that Congress understood would survive'; and (2) 'the nature of the effect of the state law on ERISA plans.' Egelhoff v. Egelhoff, 532 U.S. 141, 147 (2001). In regard to the first factor, the main objective of ERISA's preemption clause is 'to avoid a multiplicity of regulation in order to permit the nationally uniform administration of employee benefit plans.' * * * As to the second factor of the 'connection with' test, the intended effect of the Act is to force Wal-Mart to increase its contribution to its health benefit plan, which is an ERISA plan, and the actual effect of the Act will be to coerce Wal-Mart into doing so. Therefore, this factor is fully satisfied."

RELIGION - THE "MINISTERIAL EXCEPTION"

Petruska v. Gannon University, ___ F.3d ___ (3rd Cir 09/06/2006) (on rehearing)

Facts: During a restructuring, a Catholic university demoted Petruska from her position as chaplain. Her suit alleged (1) demotion because of her sex and in retaliation for her opposition to sexual harassment in violation of Title VII, (2) civil conspiracy, (3) negligent supervision and retention, (4) fraudulent misrepresentation, and (5) breach of contract.

Held: The ministerial exception requires dismissal of the claims of Title VII discrimination and retaliation, civil conspiracy, and negligent supervision and retention. It does not require dismissal of the claims of fraudulent misrepresentation or breach of contract.

Key quotes: 

General rule: The ministerial exception, "a doctrine rooted in the First Amendment," "applies to any claim, the resolution of which would limit a religious institution's right to choose who will perform particular spiritual functions."

Title VII: "Gannon's choice to restructure constituted a decision about who would perform spiritual functions and about how those functions would be divided. Accordingly, application of Title VII's discrimination and retaliation provisions to Gannon's decision to restructure would violate the Free Exercise Clause."

Civil conspiracy and negligent supervision: "Because the First Amendment protects Gannon's right to restructure - regardless of its reason for doing so - we cannot consider whether the act was unlawful or tortious, and, therefore, these claims must be dismissed."

Fraudulent misrepresentation: "The resolution of Petruska's fraudulent misrepresentation claim does not turn on the lawfulness of the decision to restructure, but rather on the truth or falsity of the assurances that she would be evaluated on her merits .... * * * The state's prohibition against fraud does not infringe upon Gannon's freedom to select its ministers ...."

Contract claim: "Application of state contract law does not involve government-imposed limits on Gannon's right to select its ministers: Unlike the duties under Title VII and state tort law, contractual obligations are entirely voluntary."

Original, now vacated, decision, 448 F.3d 615 (05/24/2006) (2-1) [in advance sheet; withdrawn from bound volume] held: The district court could not dismiss any of these claims.

Key quote from vacated opinion:

"We adopt a carefully tailored version of the ministerial exception. Where otherwise illegal discrimination is based on religious belief, religious doctrine, or the internal regulations of a church, the First Amendment exempts religious institutions from Title VII. In such cases, restricting a church's freedom to select its ministers would violate the Free Exercise Clause by inhibiting the church's ability to express its beliefs and put them into practice. Furthermore, questions about religious matters would pervade litigation, entangling courts in ecclesiastical matters and violating the Establishment Clause.

"But where a church discriminates for reasons unrelated to religion, we hold that the Constitution does not foreclose Title VII suits. Employment discrimination unconnected to religious belief, religious doctrine, or the internal regulations of a church is simply the exercise of intolerance, not the free exercise of religion that the Constitution protects. Furthermore, in adjudicating suits that do not involve religious rationales for employment action, courts need not consider questions of religious belief, religious doctrine, or internal church regulation, a process that would violate the Establishment Clause by entangling courts in religious affairs."

Related cases:

The traditional and majority rule: The ministerial exception "deprives a federal court of jurisdiction to hear a Title VII employment discrimination suit brought against a church by a member of its clergy, even when the church's challenged actions are not based on religious doctrine."  Combs v. Central Texas Annual Conference, 173 F.3d 350 (5th Cir 1999), following McClure v. Salvation Army, 460 F.2d 553 (5th Cir 1972). 

Tomic v. Catholic Diocese, 442 F.3d 1036 (7th Cir 04/04/2006) followed the traditional rule in an ADEA case involving removal of a choir director.

Hankins v. Lyght, 438 F.3d 163 (2nd Cir 02/16/2006) (2-1), involving forced retirement of a clergy member, avoided deciding the ministerial exception issue, and held that the Religious Freedom Restoration Act amended the ADEA. Remanded for reconsideration in light of the Religious Freedom Restoration Act.

Elvig v. Calvin Presbyterian Church, 375 F.3d 951 (9th Cir 2004) (2-1), rehearing denied with opinions, 397 F.3d 790 (2005), held that a church minister can state a claim for sexual harassment, but the ministerial exception requires dismissal of any claim involving discharge.

Dolquist v. Heartland Presbytery, 342 F.Supp.2d 996 (D Kans 2004) held that a church pastor can state a claim for sexual harassment and retaliation.

CLASS ACTION FAIRNESS ACT - LESS MEANS MORE

Amalgamated Transit Union v. Laidlaw Transit, 435 F.3d 1140 (9th Cir 01/26/2006), en banc rehearing denied with opinions,  448 F.3d 1092 (05/22/2006)

Facts: A union and employees filed a class action in state court alleging state law claims, and the employer removed to federal court under the Class Action Fairness Act (CAFA). The federal court denied plaintiffs' motion to remand to state court, and plaintiffs appealed.

Statute: 28 USC § 1453(c)(1): "... a court of appeals may accept an appeal from an order of a district court granting or denying a motion to remand a class action to the State court from which it was removed if application is made to the court of appeals not less than 7 days after entry of the order."

Held: Although § 1453(c)(1) provides that an application may be made "not less" than 7 days after entry of the order, it should be read as requiring that an application be made "not more" than 7 days after entry of the order.

Key quote: "Federal Rule of Appellate Procedure [FRAP] 5 governs the initiation of such appeals, and ... the petition for permission to take an appeal must be filed not more than seven court days after the district court's order."

On motion for rehearing en banc: Motion denied. Six judges filed a dissent arguing that a court has no business rewriting the statute merely because the way it was actually written is "illogical."

Other cases agree: Morgan v. Gay, __ F.3d __ (3rd Cir 10/16/2006); Patterson v. Dean Morris, 444 F.3d 365 (5th Cir 03/22/2006) (a filing 9 calendar days after the order is within the 7-day limit because weekends and holidays are excluded); Miedema v. Maytag Corp, 450 F.3d 1322 (11th Cir 06/05/2006); Pritchett v. Office Depot, Inc., 420 F.3d 1090 (10th Cir 2005) ("not less" was a typographical error).

FLSA - WALKING AND WAITING TIME

IBP, Inc v. Alvarez, 126 S.Ct. 514 (11/08/2005)

Facts: Employees working in meat-packing and chicken-cutting plants must wear special protective clothing. They show up at the plant and wait (sometimes in line) to put on the clothing. Then they walk to their individual workstations. At the end of the shift they walk back to a locker room, perhaps do some waiting, and then take off the protective clothing.

Held: the Fair Labor Standards Act (FLSA) requires that employees be paid wages for the time they spend putting on required protective clothing and walking to their work stations from the place where they put on the clothing. Employees also must be paid for the whole day, including time spent waiting to take off the clothing, and the day ends when they take off the protective clothing. However, there is no requirement that employees be paid for time spent waiting to put on the first piece of protective clothing.

Key quote: "We hold that any activity that is 'integral and indispensable' to a 'principal activity' is itself a 'principal activity' under § 4(a) of the Portal-to-Portal Act. Moreover, during a continuous workday, any walking time that occurs after the beginning of the employee's first principal activity and before the end of the employee's last principal activity is excluded from the scope of that provision, and as a result is covered by the FLSA."

42 USC § 1981 - STANDING

Domino's Pizza v. McDonald, 126 S.Ct. 1246 (02/22/2006)

Facts: McDonald, a black man, was president and sole shareholder of JWM Investments, Inc., which corporation entered into contracts with Domino's. McDonald claimed that Domino's broke those contracts because of racial animus toward McDonald, and sued under 42 USC § 1981.

Statute: 42 USC § 1981: "All persons within the jurisdiction of the United States shall have the same right in every State and Territory to make and enforce contracts ... as is enjoyed by white citizens ...."

Held: A plaintiff cannot state a § 1981 claim unless he has (or would have) rights under the existing (or proposed) contract that he wishes "to make and enforce."

Editor: Ross Runkel, Professor of Law Emeritus. email Ross@LawMemo.Com, Phone 503-399-8028. Copyright LawMemo, Inc.