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August 10, 2005
Cert petition on post-termination hearing
Yesterday Tom Goldstein of Goldstein & Howe (and SCOTUSblog contributor) filed a petition for writ of certiorari [here]. The petition states the following QUESTION PRESENTED:
In Cleveland Board of Education v. Loudermill, 470 U532 (1985), this Court held that tenured state employees have a right under the Due Process Clause to notice and a hearing before they are terminated. The courts of appeals are divided over the following question:Does the failure to provide the pre-termination hearing required under Cleveland Board of Education v. Loudermill, 470 U.S. 532 (1985), no longer violate the Due Process Clause if denial of the hearing also contravenes state law and state law provides a post-termination remedy?
Employment Law Memo had this to say about the Court of Appeals decision:
Public employee's due process claim was barred by "Parratt-Hudson" doctrine.Hadfield v. McDonough (1st Cir 05/11/2005)
http://laws.findlaw.com/1st/042020.htmlHadfield sued the public employer, alleging violation of his 1st Amendment and 14th Amendment (deprivation of property interest without due process) rights. The trial court granted summary judgment in favor of the employer. The 1st Circuit affirmed. The court concluded political affiliation was an appropriate requirement for Hadfield's job. The court also concluded that Hadfield's due process claim was barred by the "Parratt-Hudson" doctrine.
The Parratt-Hudson doctrine arises from Parratt v. Taylor, 451 US 527 (1981), and Hudson v. Palmer, 468 US 517 (1984). It shields a public entity from a federal due process claim where the denial of process was caused by the random and unauthorized conduct of government officials and where the state has provided adequate post-deprivation remedies to correct the random and unauthorized acts. Applying the Parratt-Hudson doctrine, the court determined that Massachusetts provided a sufficient post-deprivation remedy and that Hadfield chose not to avail himself of that remedy.
Posted August 10, 2005 by Ross Runkel, Editor at LawMemo, publisher of Employment Law Memo. Try it.
June 28, 2005
US Supreme Court roundup
The US Supreme Court has ended its 2004-2005 session. Here's a list of employment cases decided and pending. Pending cases will be argued and decided in the next session beginning in October. For details on these cases see Supreme Court Review: 2004-2005 Employment Law Cases.
Cases decided:
- ADEA allows disparate impact claims (5-3); employees lose on the merits
Smith v. City of Jackson (03/30/2005)
- False Claims Act retaliation claim statute of limitations is the most analogous state statute
Graham County Soil v. US ex rel Wilson (06/20/2005) - Title IX allows private right of action for retaliation (5-4).
Jackson v. Birmingham Board Of Education (03/29/2005) - Plaintiffs must pay tax on that portion of a settlement that went to attorneys as a contingent fee.
Commissioner v. Banks (01/24/2004) - Making and selling sexually explicit video is not expression on a matter of public concern.
San Diego v. Roe (12/06/2004)
Cases pending:
- Does Civil Service Reform Act confer federal court jurisdiction?
Whitman v. Department of Transportation
Decision below: Whitman v. Department of Transportation (9th Cir 08/30/2004) - Is Title VII's 15-employee threshold jurisdictional?
Arbaugh v. Y & H Corp
Decision below: Arbaugh v. Y&H Corp (5th Cir 08/02/2004) - Does the 1st amendment protect schools from losing federal funds when they refuse to allow military recruiters? (The Solomon Amendment case)
Rumsfeld v. Forum For Academic and Institutional Rights
Decision below: Forum For Academic and Institutional Rights v. Rumsfeld (3rd Cir 11/29/2004) - Does the 1st amendment protect a deputy district attorney who wrote a memo to his supervisor alleging that a deputy sheriff lied on a search warrant application?
Garcetti v. Ceballos
Decision below: Ceballos v. Garcetti (9th Cir 03/22/2004) - Is time spent walking to the worksite after donning protective clothing compensable under the FLSA and Portal-to-Portal Act?
Tum v. Barber Foods
Decisions below: Tum v. Barber Foods (1st Cir 03/10/2004); Alvarez v. IBP, Inc. (9th Cir 08/05/2003)
Employment Law Memo subscribers will get a same-day report when the Supreme Court decides these pending cases.
Posted June 28, 2005 by Ross Runkel, Editor at LawMemo, publisher of Employment Law Memo. Try it.
June 27, 2005
Cert granted on Civil Service Reform Act
The US Supreme Court granted certiorari on June 27 to review a 9th Circuit holding that the federal Civil Service Reform Act "does not confer federal court jurisdiction over statutory and constitutional claims concerning employment-related matters within the scope of the negotiated grievance procedures of a federal employee's collective bargaining agreement." Whitman v. Department of Transportation (Docket No. 04-1131).
Terry Whitman claimed his employer, the Federal Aviation Administration, disproportionately tested him for substance abuse in violation of the first amendment and the federal statute on mandatory drug testing.
First Whitman filed a charge with the Federal Labor Relations Agency, but the FLRA said his claim was not within its jurisdiction. FLRA said his recourse was through the grievance procedures of his collective bargaining agreement.
Whitman did not pursue the grievance procedure of the collective agreement.
Whitman sued the FAA in federal district court, and that court said it had no subject matter jurisdiction. The 9th Circuit agreed. Whitman v. Department of Transportation (9th Cir 08/30/2004).
The 9th Circuit's reasoning:
- The FAA Management System, including certain provisions of the Civil Service Reform Act (CSRA), governs FAA employees' employment rights and generally does not allow federal court suits.
- The CSRA requires collective bargaining agreements to include procedures for resolving "grievances," and defines "grievance" broadly to include Whitman's claims.
- Before 1994 CSRA provided that the collectively bargained procedures "shall be the exclusive procedures for resolving grievances." The 1994 amendment provided that the collectively bargained procedures "shall be the exclusive administrative procedures for resolving grievances."
- Although the Federal and 11th Circuits have held that the 1994 amendment established an employee's right to seek a judicial remedy, those cases are wrong because the 1994 amendment "does not constitute an express grant of federal court jurisdiction."
Interesting that Whitman represented himself in the 9th Circuit and is now represented by Thomas C. Goldstein of Goldstein & Howe, a firm that specializes in representing clients before the US Supreme Court.
Posted June 27, 2005 by Ross Runkel, Editor at LawMemo, publisher of Employment Law Memo. Try it.
June 20, 2005
False Claims Act retaliation claim statute of limitations
The US Supreme Court says the statute of limitations for False Claims Act retaliation claims is the most analogous state statute. Graham County Soil v. US ex rel Wilson (US Supreme Court 06/20/2005).
Wilson sued under the federal False Claims Act (FCA) claiming her employer retaliated against her for alerting federal officials to purported fraud and for cooperating with the ensuing investigation. The trial court dismissed the suit as untimely under the state's 3-year statute of limitations; the 4th Circuit reversed, applying the FCA's 6-year limitation period; the US Supreme Court reversed.
The US Supreme Court held: The appropriate statute of limitations in a False Claims Act retaliation case is the most closely analogous state statute, not the 6-year period stated in the FCA.
My view: (1) Typically state statutes of limitations will be shorter than six years. (2) Plaintiffs often join a retaliation claim with a qui tam action in the Government's name (hoping to collect a portion of the ill-gotten gains). The qui tam claim will governed by the federal six-years statute of limitations.
Posted June 20, 2005 by Ross Runkel, Editor at LawMemo, publisher of Employment Law Memo. Try it.
May 16, 2005
Tum v. Barber Foods - Petitioners' brief
Petitioning employees have filed their US Supreme Court brief [pdf] in Tum v. Barber Foods, which will be argued next fall.
Quoting from the brief:
QUESTIONS PRESENTED This Court has held that employees are entitled to compensation under the Fair Labor Standards Act, as amended by the Portal-to-Portal Act, for the time their employer requires them to spend donning and doffing health and safety equipment.
The Questions Presented are:
1. Are employees entitled to compensation for the time they must spend walking to and from required health and safety equipment distribution stations?
2. Are employees entitled to compensation for time they must spend waiting to receive equipment at required health and safety equipment distribution stations?
Courtesy of SCOTUSBlog, one of whose authors, Thomas Goldstein of Goldstein & Howe, is counsel of record for petitioners. Tom says, "Kevin Russell worked heavily on the case with a team from the Stanford Supreme Court Litigation Clinic - Rachel Kovner, Michael Mongan, and Julia Lipez."
Posted May 16, 2005 by Ross Runkel, Editor at LawMemo, publisher of Employment Law Memo. Try it.
Is 15-employee threshold jurisdictional?
Federal circuit courts have long been split on the question of whether Title VII's 15-employee threshold determines federal court subject matter jurisdiction, or is merely a matter going to the merits of a Title VII claim.
The US Supreme Court says it will review the question. Arbaugh v. Y & H Corp (Docket No. 04-944), certiorari granted 05/16/2005, Decision below: Arbaugh v. Y&H Corp (5th Cir 08/02/2004)
Arbaugh sued in federal court under Title VII and state tort law. She worked at the Moonlight Cafe in New Orleans, and claimed that one of the owners of the corporation subjected her to a sexually hostile environment. A jury returned a verdict for Arbaugh.
Now get this. After the jury verdict, the defendants moved to dismiss for lack of subject matter jurisdiction, citing Title VII's definition of an "employer" and pointing out that the defendant corporation did not employ 15 or more employees and thus was not an "employer" under Title VII. The trial court converted the motion to a motion for summary judgment, and granted the motion. So, case dismissed for lack of subject matter jurisdiction.
The 5th Circuit affirmed, holding that Title VII's 15-employee threshold determines federal court subject matter jurisdiction, and is not merely a matter going to the merits of a Title VII claim. The US Supreme Court granted certiorari to review the 5th Circuit decision.
The Courts of Appeals are split on this issue.
Courts holding it is jurisdictional are the 4th, 6th, 9th, 10th, and 11th Circuits. Courts holding it is non-jurisdictional are the 2nd, 7th, and Federal Circuits.
Posted May 16, 2005 by Ross Runkel, Editor at LawMemo, publisher of Employment Law Memo. Try it.
May 02, 2005
Military recruiting issue goes to Supreme Court
On May 2, 2005 the US Supreme Court agreed to decide "Whether the court of appeals erred in holding that the Solomon Amendment's equal access condition on federal funding likely violates the First Amendment to the Constitution and in directing a preliminary injunction to be issued against its enforcement?" Rumsfeld v. Forum For Academic and Institutional Rights (Docket No. 04-1152).
Lots of details at SCOTUSBlog: Court to rule on "Solomon Amendment"
Many law schools have tried to exclude military recruiters, and the government response has been to threaten withdrawal of funding - not just for the law school, but for the whole university. The law involved is the "Solomon Amendment."
Many schools have policies against discrimination on the basis of sexual preference, and refuse to allow the use of school resources for recruiting by employers who engage in sexual preference discrimination - including the military.
The 3rd Circuit held (2-1) that the law schools were likely to prevail on their first amendment arguments, and were entitled to a preliminary injunction against enforcement of the Solomon Amendment. Forum For Academic and Institutional Rights v. Rumsfeld (3rd Cir 11/29/2004). The 3rd Circuit issued a stay pending review by the Supreme Court.
My view: I'm doubtful that there are five justices that will agree with the 3rd Circuit. Schools remain free to teach and to say whatever they like, and to hire faculty on whatever basis they like. Any restriction on free speech (or association) seems quite incidental, especially when weighed against the Congress' powers regarding the spending power and the powers relating to war and the military.
Posted May 02, 2005 by Ross Runkel, Editor at LawMemo, publisher of Employment Law Memo. Try it.
Military recruiting issue goes to Supreme Court
On May 2, 2005 the US Supreme Court agreed to decide "Whether the court of appeals erred in holding that the Solomon Amendment's equal access condition on federal funding likely violates the First Amendment to the Constitution and in directing a preliminary injunction to be issued against its enforcement?" Rumsfeld v. Forum For Academic and Institutional Rights (Docket No. 04-1152).
Lots of details at SCOTUSBlog: Court to rule on "Solomon Amendment"
Many law schools have tried to exclude military recruiters, and the government response has been to threaten withdrawal of funding - not just for the law school, but for the whole university. The law involved is the "Solomon Amendment."
Many schools have policies against discrimination on the basis of sexual preference, and refuse to allow the use of school resources for recruiting by employers who engage in sexual preference discrimination - including the military.
The 3rd Circuit held (2-1) that the law schools were likely to prevail on their first amendment arguments, and were entitled to a preliminary injunction against enforcement of the Solomon Amendment. Forum For Academic and Institutional Rights v. Rumsfeld (3rd Cir 11/29/2004). The 3rd Circuit issued a stay pending review by the Supreme Court.
My view: I'm doubtful that there are five justices that will agree with the 3rd Circuit. Schools remain free to teach and to say whatever they like, and to hire faculty on whatever basis they like. Any restriction on free speech (or association) seems quite incidental, especially when weighed against the Congress' powers regarding the spending power and the powers relating to war and the military.
Posted May 02, 2005 by Ross Runkel, Editor at LawMemo, publisher of Employment Law Memo. Try it.
April 25, 2005
Supreme Court gets 42 USC 1981 case
Section 1981 prohibits race discrimination in the formation, termination, and performance of contracts. Can a person who is not a contracting party recover under 1981?
That's what the US Supreme Court will decide in Domino's Pizza v. McDonald, Docket No. 04-593, certiorari granted April 25, 2005.
The allegations were: McDonald, an African American, was the president and main shareholder of JWM, a corporation. JWM entered into contracts with Domino's. Domino's made it difficult or impossible for JWM to perform, propelling JWM into bankruptcy. JWM and Domino's settled. McDonald sued Domino's under Section 1981 claiming financial and emotional loss. He claimed that the downfall of JWM was caused by racial discrimination on the part of Domino's. The allegation have not been proved. The trial court granted summary judgment for the Domino's.
The 9th Circuit reversed, saying that McDonald, even though he personally had no contractual relationship with Domino's, had standing to sue Domino's for alleged injuries that he personally suffered. The 9th Circuit's decision (06/18/2004) was not reported. See 2004 WL 1380296.
The 9th Circuit relied on its earlier case Gomez v. Alexian Bros. Hosp., 698 F.2d 1019 (9th Cir 1983). The Circuits are split on this theory. See Guides Ltd v. Yarmouth Group, 295 F.3d 1065 (10th Cir 2002).
Posted April 25, 2005 by Ross Runkel, Editor at LawMemo, publisher of Employment Law Memo. Try it.
March 30, 2005
ADEA allows disparate impact claims - sort of
The US Supreme Court has endorsed using disparate impact theory in ADEA cases, but now we have to go back and relearn all the pre-1991 cases. Smith v. City of Jackson (US Supreme Court 03/30/2005).
Older cops sued the City claiming that a new pay plan gave them lower raises than younger cops got. Reason? The City granted proportionately more money to officers with less than five years' service in an attempt to bring starting salaries up to the regional average. The 5th Circuit said the plaintiffs must lose because the ADEA categorically disallows disparate impact claims. The US Supreme Court affirmed the judgment for the City on totally different grounds: the ADEA does allow disparate impact claims, but the plaintiffs lost on the merits.
Disparate impact theory got its wings in Griggs v. Duke Power, 401 US 424 (1971), a Title VII case. Those wings got clipped in Wards Cove v. Atonio, 490 US 642 (1989). Wards Cove says that plaintiffs are "responsible for isolating and identifying the specific employment practices that are allegedly responsible for any observed statistical disparities." Congress then adopted the Civil Rights Act of 1991 which codified disparate impact theory and made things a bit easier for plaintiffs - at least in Title VII cases. But Congress never amended the ADEA the way it amended Title VII.
The ADEA and Title VII are identical in one respect.
ADEA Section 4(a)(2) is the same as Title VII Section 703(a)(2) except for substituting "age" for "race, color, religion, sex, or national origin." From that similarity in statutory text the Court concluded that the ADEA does permit employees to use the disparate impact theory.
But there are two huge differences between Title VII and the ADEA.
Unlike Title VII, the ADEA significantly narrows its coverage via the "RFOA" provision which permits any "otherwise prohibited" action "where the differentiation is based on reasonable factors other than age."
Applying the RFOA provision, the Court said "the disparate impact is attributable to the City's decision to give raises based on seniority and position. Reliance on seniority and rank is unquestionably reasonable given the City's goal of raising employees' salaries to match those in surrounding communities." Thus, the City's decision was based on a "reasonable factor other than age." There may have been other reasonable ways, including ways that did not have a disparate impact on older workers, but unlike the business necessity test, "the reasonableness inquiry includes no such requirement."
Law teachers will be pleased to learn that pre-1991 cases are now relevant to ADEA disparate impact analysis. Why? The 1991 Civil Rights Act overruled those cases for Title VII litigation, but not as they relate to the ADEA.
For ADEA cases, the Court will apply its pre-1991 interpretation of Title VII's identical language, most notably the interpretation in Wards Cove v. Atonio, 490 US 642 (1989). Wards Cove says that plaintiffs are "responsible for isolating and identifying the specific employment practices that are allegedly responsible for any observed statistical disparities," and the employees in this case have failed to do so. They did "little more than point out that the pay plan at issue is relatively less generous to older workers than to younger workers. They have not identified any specific test, requirement, or practice within the pay plan that has an adverse impact on older workers."
My view: (1) Employees can use disparate impact theory, but must sharpen their analysis and proof to fit the Court's pre-1991 cases interpreting Title VII. (2) Employers will easily win many cases under the RFOA provision because it only needs to be "reasonable" rather than a matter of "business necessity." Almost by definition, distinctions based on length of service or on rank will be reasonable.
Posted March 30, 2005 by Ross Runkel, Editor at LawMemo, publisher of Employment Law Memo. Try it.
February 28, 2005
Whistleblowing Assistant DA gets to US Supreme Court
The Supreme Court has another chance to tell the 9th Circuit how the 1st amendment works for public employees. Assistant DA Richard Ceballos sent a memo to his supervisor alleging that a sheriff deputy lied on a search warrant. Ceballos later filed suit claiming his superiors retaliated against him for this.
The last time the Supreme Court had a public employee 1st amendment case from the 9th Circuit the Justices reversed the 9th Circuit without even hearing oral arguments. Ouch. That was San Diego v. Roe (12/06/2004) [full text pdf] in which a police officer was discharged for selling videos of himself masturbating. The 9th Circuit actually thought that was protected by the US constitution. The Supreme Court's per curiam decision (a rare item) said it was "not a close case."
Now comes Garcetti v. Ceballos - certiorari granted February 28, 2005. [9th Circuit decision pdf] The 9th Circuit went through the drill of asking (1) whether Ceballos' speech was a matter of public concern [YES] and, if so, (2) whether his interests outweighed the public employer's interest [YES].
The real question? Whether his speech lacks constitutional protection because it was uttered in the course of carrying out his employment obligations.
9th Circuit Judge Diarmuid O'Scannlain, in a concurring opinion, argued that the 9th Circuit's jurisprudence in this area is flat wrong. (He couldn't know that the Roe case would be summarily reversed.) He traces it all to Roth v. Veteran's Administration, 856 F.2d 1401 (9th Cir 1988), in which the court said that when a public employee speaks on matters of public importance, that speech automatically comes within the definition of a matter of public concern.
My view: The 9th Circuit's Roe decision was off the wall. Its Ceballos decision seems to lose track of what the 1st amendment is for. It is not to protect employees in the conduct of their day-to-day employment duties. Perhaps there should be laws to protect assistant DAs from getting demoted when they tell the boss that a police officer rigged a search warrant. I could vote for that. But a constitutional right? I don't think so.
Posted February 28, 2005 by Ross Runkel, Editor at LawMemo, publisher of Employment Law Memo. Try it.
Supreme Court resources
I like to keep track of US Supreme Court labor and employment law cases. Here are some resources I suggest:
Article on recently decided and pending employment cases: Supreme Court Review: Current Employment Law Cases.
Article on employment cases during the 2003-2004 term of court: U.S. Supreme Court Employment Law Decisions: The Good, The Bad, And The Ugly.
List of pending cases.
Briefs filed in pending cases.
Transcripts of oral arguments in pending cases.
Recent decisions [Official web site] [Cornell's LII web site]
email bulletins [Cornell] [Willamette Law Online]
Last but not least: Employment Law Memo sends email reports on Supreme Court labor and employment decisions on the same day they are decided. [Try it]
Posted February 28, 2005 by Ross Runkel, Editor at LawMemo, publisher of Employment Law Memo. Try it.
February 22, 2005
Are walking and waiting time compensable?
The US Supreme Court granted certiorari in two cases that will decide whether time spent walking from the locker room to the work area, after donning special protective gear, is compensable under the FLSA.
IBP, Inc. v. Alvarez and Tum v. Barber Foods.
Employees in meat packing plants wear a lot of protective gear. For much of it, the employer and the government require that it be worn. Employees spend time donning and doffing this gear. Both the 1st and 9th Circuits agree they must be paid for that time.
But what about the time spent walking from the locker room to the place where the real work begins, and time spent waiting to put this gear away? The circuit courts split, with the 9th Circuit saying it must be compensated, and the 1st Circuit saying it need not be compensated.
It all has to do with whether this is within the FLSA's "changing clothes" exception, and whether the time is excluded by the Portal-to-Portal Act because it is preliminary or postliminary activity.
For the lower court decisions:
Alvarez v. IBP, Inc. (9th Cir 08/05/2003) [Full text pdf]
Tum v. Barber Foods (1st Cir 03/10/2004) [Full text]
Posted February 22, 2005 by Ross Runkel, Editor at LawMemo, publisher of Employment Law Memo. Try it.
February 01, 2005
Does disparate impact theory apply in age discrimination cases?
In Smith v. Jackson, Mississippi the US Supreme Court will decide whether the disparate impact theory of proof can be applied in a case arising under the Age Discrimination in Employment Act (ADEA).
Plaintiffs were City police officers and dispatchers over the age of 40 who claimed that the City's performance pay plan granted substantially larger pay increases to employees under age 40. Under the pay plan, employees with five or fewer years of tenure received proportionately greater raises when compared to their former pay than those with more than five years of tenure. Plaintiffs offered statistical proof that average pay increases differed by age and older employees received smaller raises than younger employees. The trial court held that the disparate impact theory could not be used in an ADEA case; the 5th Circuit affirmed [Full text pdf]. The US Supreme Court is reviewing the 5th Circuit decision [Briefs], and heard oral arguments [Transcript pdf] on November 3, 2004.
Circuit courts are split on this issue. Those allowing use of the disparate impact theory are the 2nd, 8th, and 9th. Those not allowing the disparate impact theory are the 1st, 5th, 7th, 10th, and 11th.
It all started with Griggs v. Duke Power, 401 US 424 (1971). The employer required a high school diploma for entry into certain jobs. This requirement disqualified Blacks at a much higher rate than Whites. The US Supreme Court held that once the plaintiffs proved this "disparate impact," then the burden shifted to the employer to justify the practice by showing job relatedness or business necessity.
Griggs was a Title VII case. Smith is an ADEA case. The statutes are similar in one major respect: the primary prohibitory language is virtually identical. Of course, the plaintiffs latch onto that, plus an EEOC regulation that recognizes disparate impact.
On the other hand, the ADEA contains a clause that is similar to the Equal Pay Act (EPA). The ADEA has a specific exception for "where the differentiation is based on reasonable factors other than age" (RFOA), similar to the EPA's exception for "any factor other than sex." The Supreme Court has said there can be no disparate impact claims brought under the EPA, and that was in large part because of the "any factor other than sex" language. This favors the employer's position, and is the backbone of many lower court decisions.
An interesting twist is whether the Older Workers Benefit Protection Act (OWBPA) should be read as making the RFOA an affirmative defense rather than a redefinition of liability. NELA makes a great argument along this line in its amicus brief [brief pdf].
Finally, there is the fact that the Civil Rights Act of 1991 amended Title VII to make clear that disparate impact claims could be brought under Title VII, but made no such amendment to the ADEA. I think that will be irrelevant because the Court should not interpret Congress' non-action as evidence of Congressional intent.
Posted February 01, 2005 by Ross Runkel, Editor at LawMemo, publisher of Employment Law Memo. Try it.
January 24, 2005
Plaintiffs pay tax on portion of settlement that went to attorneys
The US Supreme Court held this morning that plaintiffs must pay tax on that portion of a settlement that went to attorneys as a contingent fee. Commissioner v. Banks (US Supreme Court 01/24/2004).
Former employees sued their former employers claiming various legal theories under state law and federal law. In each case settlements were reached. The employees filed federal income tax returns that excluded from income that portion of the settlements that the plaintiffs had to pay to their attorneys under contingent fee agreements. The Internal Revenue Service said these amounts should have been included as taxable income, and the Tax Court agreed. The 6th Circuit and the 9th Circuit both reversed, holding that these amounts were not part of the plaintiffs' taxable income. The US Supreme Court unanimously reversed, holding that plaintiffs must pay tax on that portion of the settlement that went to attorneys as a contingent fee.
The Court relied on two basic taxation principles. (1) "Gross income" as defined by the Internal Revenue Code includes "all income from whatever source derived" which means all economic gains not otherwise exempted. (2) A taxpayer cannot exclude an economic gain from gross income by assigning the gain in advance to another party. The Court held that the contingent fee agreement should be viewed as an anticipatory assignment to the attorney of a portion of the client's income from any litigation recovery.
One of the employee-taxpayers brought claims under federal statutes that authorize fee awards to prevailing plaintiffs' attorneys. He argued that the anticipatory assignment principle would be inconsistent with the purpose of statutory fee shifting provisions. The Court did not address these claims because the fee paid to his attorney was calculated solely on the basis of the private contingent fee contract. There was no court-ordered fee award, and no other indication that the fee paid to the attorney was in lieu of statutory fees.
The American Jobs Creation Act of 2004 amended the Internal Revenue Code [read amendment] to allow a tax deduction for amounts a plaintiff pays for attorney fees and court costs in connection with an action involving a claim of "unlawful discrimination" as defined by the Act. The new statute applies only to fees and costs paid after October 22, 2004.
Posted January 24, 2005 by Ross Runkel, Editor at LawMemo, publisher of Employment Law Memo. Try it.
January 19, 2005
Private action for retaliation under Title IX?
In Jackson v. Birmingham Board of Education the US Supreme Court will decide whether Title IX provides a private cause of action for retaliation against a man because he complained about alleged sex discrimination against women.
The 11th Circuit held in favor of the employer. The US Supreme Court heard oral arguments on November 30, 2004. We're waiting for the decision.
Roderick Jackson, a girls' basketball coach, sued under Title IX of the Education amendments of 1972 claiming he was removed from his coaching position because he complained about practices he believed discriminated against his girls' basketball team in violation of Title IX. The trial court dismissed the action; the 11th Circuit affirmed. The 11th Circuit held that Title IX does not provide a private cause of action for individuals who suffer retaliation for complaining about gender discrimination suffered by others. The US Supreme Court granted certiorari to review the 11th Circuit's decision. Decision below: Jackson v. Birmingham Board of Education (11th Cir 10/21/2002). [Briefs and argument transcripts]
A lot of organizations have filed amicus briefs in support of Mr. Jackson: the United States government, the NEA, AAUP, and a whole bunch of sports organizations. Trouble is they don't get to vote; only the Justices do.
The employer's argument is simple: Title IX's language prohibits discrimination but does not prohibit retaliation. Administrative regulation that seem to support Jackson are not entitled to deference because there is no ambiguity in the statute. Jackson has no standing under the regulations as they are written. And Jackson's case is controlled by Alexander v. Sandoval (US Supreme Court 04/24/2001), which held that there is no private right of action for violation of disparate impact regulations promulgated under Title VI.
Jackson's argument is a bit more complex: Although Title IX does not expressly prohibit retaliation, retaliation is included in the concept of "discrimination." Administrative regulations adopted by the Department of Education and the Department of Justice prohibit retaliation against a person because that person has filed a sex discrimination complaint. Neither Title IX itself nor the regulations makes a distinction on the basis of whether the underlying discrimination that is complained about was directed at the complainant (here, Jackson) or someone else (here, the girls' basketball team). Alexander v. Sandoval has no application because it was limited to the question of whether Title VI created a private action to enforce disparate impact regulations.
My sense is that the Supreme Court is reluctant to imply causes of action into statutes and regulations. Their job is to carry out the will of Congress, whether or not the outcome is one they like. The regulations prohibit discrimination (which fairly can include retaliation) "because he has made a complaint, testified, assisted, or participated in any manner in an investigation, proceeding or hearing under this part." One problem for Jackson's side is that what he did was complain to his supervisors. Other statutes that expressly forbid retaliation typically include two types: "participation" (which the regs cover) and "opposition" (which the regs do not cover). Jackson's fact pattern does not seem to fit the regulation. In addition, there is the problem of whether the regulations go beyond the bounds of the statute in the first place.
Posted January 19, 2005 by Ross Runkel, Editor at LawMemo, publisher of Employment Law Memo. Try it.
