Wednesday, March 31, 2010

Hostile work environment case dismissed on appeal

Some hostile work environment cases make it to trial, and some don't. This one did not, even though the Court of Appeals finds the conduct of a male supervisor to be particularly inappropriate.

The case is Kercado-Clymer v. City of Amsterdam, a summary order decided on March 25. Kercado-Clymer sued under Section 1983, which allows the defendants to raise a qualified immunity defense, which in turn allows them to take up an immediate appeal if the district court denies their motion for summary judgment.

Here's the plaintiff's hostile work environment evidence: "Kercado-Clymer alleges that Brownell created a hostile work environment based on her gender by making several sexually and racially derogatory statements and by denying her desk duty during the week, disciplining her for driving the wrong way down a one-way street, and denying her overtime opportunities." Her claim fails. The Second Circuit (Winter, Katzmann and Rakoff, D.J.) concludes:

[W]hile Kercado-Clymer argues that she was subject to sexual harassment on a regular basis, she only points to a few incidents of facially sexual harassment over a thirteen year period—Brownell’s comment about raping his wife, his remarks about her hair and her relationship with her husband, and the inappropriate postcard he sent to the precinct. The other incidents alleged by Kercado-Clymer as contributing to the hostile work environment were not facially related to sex. Even taken together, however, while certainly highly offensive, these instances are far less severe or pervasive than those for which we have concluded that a reasonable trier of fact could find a hostile work environment.

The Court of Appeals certainly sympathizes with plaintiff, and the Court thinks that Brownell is a pig, deeming his behavior "patently inappropriate." What dooms the case for plaintiff is that not enough incidents happened over a 13-year period and not all of it was explicitly gender-related. While offensive behavior that is not explicitly sexist may support a gender-harassment case, (Raniola v. Bratton, 243 F.3d 610, 621 (2d Cir. 2001), the Court doesn't think that Kercado-Clymer has enough for trial.

Tuesday, March 30, 2010

You can't just smack inmates around

It's true. You can't just smack inmates around. The Constitution protects inmates from the excessive use of force. The courts have outlined a way to resolve these cases, sensitive to the fact that jails need to maintain order and some pushing and shoving is inevitable.

The case is Abreu v. Nicholls, decided on March 3. Abreu won this appeal pro se, by the way. It all started when he was a new inmate, and Correction Officer Nicholls told Abreu to stop looking at him.

Nicholls then took out a rubber-headed “hammer” from an office desk and stood in front of Abreu. Nicholls said, “Didn’t I tell you not to look at me,” to which Abreu responded, “I’m not from this prison, I come from the state.” ... Nicholls then “began to press the hammer to [his] forehead.”

While the hammer was pressed to his head, Nicholls told Abreu, “Come on, do what ever you want,” but Abreu did not respond because the other inmates urged him to stay silent. Nicholls pressed the hammer into his head between one and five times and his head went “half way” backwards. After one to two minutes, Nicholls removed the hammer from his forehead and put it back into the desk.

This testimony is enough for Abreu to win the case, so the Court of Appeals (Calabresi, Katzmann and Chin [D.J.]), reverses summary judgment in a summary order. In the early 1970's, the Court of Appeals held that not every push or shove at the jailhouse is actionable under the Eighth Amendment's prohibition against cruel and unusual punishment. But the Supreme Court has also ruled that the issue is "whether force was applied in a good-faith effort to maintain or restore discipline, or maliciously and sadistically to cause harm.” The extent of the inmate's injury is a relevant factor, but it is not dispositive. Summing up the legal standard, the Court of Appeals notes that "Where a prison official acts 'maliciously and sadistically,' 'contemporary standards of decency always are violated. This is true whether or not significant injury is evident.' But even when a prison official acts maliciously or sadistically, 'not every push or shove ... violates a prisoner’s constitutional rights.' '[T]he Eight Amendment’s prohibition against cruel and unusual punishment does not extend to de minimis uses of physical force, provided that the use of force is not of a sort repugnant to the conscience of mankind.'”

It doesn't look like Nicholls used force against Abreu for any good reason, certainly not "any proper penal purpose," the Second Circuit holds. Rather, it looks like a "calculated effort to apply a moderate amount of force in a way that threatened the use of significantly greater force." Using a rubber-headed hammer to bend Abreu's head "half way backwards" does not seem kosher, either.

Monday, March 29, 2010

Malicious prosecution case goes back to the drawing board

Two women sued the police after an arrest for something they didn't do. They lost at trial. The Court of Appeals remands for a new trial because the trial judge made what looks like a seriously misguided evidentiary ruling that allowed some police witnesses to opine on the officers' credibility. The Court of Appeals also tells the district court what evidence to admit on remand.

The case is Cameron v. City of New York, decided on March 10. Malicious prosecution cases are all about witness credibility. The plaintiffs claim they did nothing to justify the arrest. The police say that they had probable cause to arrest the plaintiffs. The jury -- God bless 'em -- has to figure out who is telling the truth, or at least who has the more believable story.

What happened here was that the judge allowed the City to elicit testimony from two assistant district attorneys and a police officer who was present when plaintiffs were arrested. These witnesses testified about the credibility of officers Ramos and Rivera on the issue of whether they had probable cause to arrest plaintiffs Cameron and Higgenbottom, and as to whether certain evidence strengthened or weakened the plaintiffs' case.

This testimony certainly bolstered the City's case. One of the ADA's, for example, "testified extensively about her communications with Rivera and Ramos. She testified that nothing Rivera or Ramos said led her to consider dropping the case; that she had no reason to believe anything they said was inaccurate." Another ADA testified that "she would not have decided to prosecute Ms. Cameron if [she] did not believe there was probable cause to believe that [Cameron] had committed a crime.” A lieutenant testified that "after speaking with Ramos and Rivera, [she] thought that probable cause existed to arrest Cameron and had no 'reason to doubt the officers’ account of the facts that day.'” It looks like the plaintiffs' lawyers objected like crazy to some of this testimony.

Plaintiffs' lawyers called it right. Credibility is for the jury. Trial witnesses cannot testify that another witness is credible. They also cannot testify as to legal conclusions. While lay witnesses can provide some opinion testimony, that's only allowed when "helpful to a clear understanding of the witness' testimony or the determination of a fact in issue." As probable cause was a key issue at trial, the Court of Appeals (Calabresi, Cabranes and Hall) provides a bright-line rule: "we hold that prosecutors’ opinions as to probable cause and complaining officers’ credibility are irrelevant in virtually all cases involving claims of malicious prosecution. In such cases, district courts remain bound by the rules of evidence that normally govern opinion testimony."

Although the district court should not have allowed this testimony, the City still wins the appeal unless the evidence was harmless at trial. It was not. Not only did this testimony speak to the critical issues at trial (whether the police had probable cause or acted with malice), but this testimony was not cumulative but, instead, "provided strong external validation for propositions that would otherwise have come in only from the appellees' mouths." As the City's lawyers used this testimony in opening and closing arguments and the City did not have a particularly strong case to start with, the Second Circuit is convinced that the trial judge's error was not harmless. After next taking the time to set forth what evidence is admissible on remand, the Second Circuit orders a new trial.

Thursday, March 25, 2010

Qualified immunity attaches in child neglect case

Over the last few months, the Second Circuit has reminded us how difficult it is to sue state child welfare caseworkers who mistakenly remove children from their parents. Cases in point are Cornejo v. Bell, 592 F.3d 121 (2d Cir. Jan. 4, 2010) and Graham v. Mattingly, 2009 U.S. App. LEXIS 22908 (2d Cir. Oct. 19, 2009).

This time around it's V.S. v. Muhammad, decided on February 17. Caseworkers took V.S.'s child away after infant T.S. had a swollen leg and a fractured femur. When caseworker Muhammad and Dr. Esernio-Jenssen investigated, V.S. and her mother could not explain away these injuries. The mother eventually admitted that she dropped the baby, but even that did not explain all the injuries. The doctor concluded that T.S. was the victim of "shaken baby syndrome," and Family Court took away the baby after a hearing in which Muhammad did not advise the court about the mother's negligence in dropping the baby or other exculpatory information. Plaintiff's expert opined that the injuries were more consistent with childbirth injuries, and in the end, V.S. got her baby back when the agency withdrew the petition.

The Court of Appeals (Miner, Cabranes and Rakoff, D.J.) finds that defendants have qualified immunity from suit. Qualified immunity is a creature of the federal civil rights laws; it gives public officials benefit of the doubt in close cases requiring discretionary judgment. Not all civil rights cases warrant qualified immunity, but Judge Rakoff says this one does in light of the information known to the defendants when they made their initial decisions about child abuse. That initial decision was not unreasonable, particularly since some of the injuries were not sufficiently explained.

V.S. had some interesting arguments in her favor, but the Court of Appeals sees it differently. While Muhammad did not tell the Family Court certain facts which may have cleared the plaintiff, the Court of Appeals notes that plaintiff's attorneys were in Family Court as well and could have easily apprised the judge in that proceeding the same information. While the doctor in this case allegedly had "repeatedly misdiagnosed child injuries as evidence of child abuse," the Court of Appeals doesn't find this a sufficient reason to reject immunity:

She based her diagnosis of T.S. on determinations made by another doctor, Dr. Sylvia Kodsi, of retinal hemorrhages, a common indicator of shaken baby syndrome, and her opinion was shared by another well qualified physician, Dr. Shakin. Even if the ACS personnel here involved had been aware of Dr. Esernio-Jenssen’s alleged “reputation” for overdiagnosing child abuse, it still would not have been unreasonable for them to rely on Dr. Esernio-Jenssen’s diagnosis of T.S. in these circumstances.

Wednesday, March 24, 2010

Monserrate loses Senate expulsion appeal

Former State Senator Hiram Monserrate lost his expedited appeal that challenges his expulsion from the Senate after he was convicted on a domestic violence offense.

The case is Monserrate v. New York State Senate, decided on March 16. The Senate booted Monserrate after he was convicted. Monserrate sued with the help of noted civil rights lawyer Norman Siegel. The Court of Appeals (Jacobs, Lynch and Restaini) heard the appeal on March 12, a Friday, issuing a lengthy decision the following Tuesday.

This was an appeal from an adverse district court ruling. Monserrate sought an injunction in his favor, requiring a finding that he was likely to succeed on the merits. The primary argument was that the Senate violated the voting rights of Monserrate's constituents in violation of the Constitution. Voting rights cases are decided on a flexible legal standard. While the right to vote is quite valuable, that does not mean the courts review voting rights cases under "strict scrutiny," the heightened judicial review standard where the government nearly always loses. Rather, we have a flexible framework that says that "if the burden imposed is less than severe and reasonably related to the important state interest, the Constitution is satisfied."

Monserrate loses his appeal. His expulsion from the Senate imposed a "less than severe burden." This is because the special election held on March 16 (in which Monserrate ran and lost) will "(i) reduce the amount of time that the voters of the 13th Senatorial District are without representation, (ii) allow those voters to exercise their voting rights anew, and (iii) provide those voters an opportunity to re-elect Monserrate should they choose to do so following his misdemeanor conviction. That there would be no Special Election but for Monserrate’s expulsion, does not diminish the Special Election’s value."

The Court of Appeals next finds that the Senate's justification for giving Monserrate the heave-ho did vindicate an important government interest, i.e., maintaining the integrity of the Senate. This is not a hard call. The Senate is entitled to enforce its zero-tolerance policy against domestic violence. Monserrate's behavior was "incompatible with the duties of the Senate to uphold publoic confidence and promote the administration of justice under law." As his expulsion was reasonable, it does not violate the Constitution.

Sunday, March 21, 2010

Circuit tosses ADA verdict in "Shy Bladder" case

The Americans With Disabilities Act requires employers to reasonably accommodate your disability. What does it mean to "reasonably accommodate"? And what is a "disability"? The answer to those questions can take all day. Our focus today is Paruresis and New York City's rules for shipboat captains.

The case is Kinneary v. City of New York, decided on March 19. I argued this appeal. Kinneary worked for the City as a Sludge Boat Captain with the NYC Department of Environmental Protection. He was unable to comply with the City's drug tests because of his Paruresis, commonly known as Shy-Bladder Syndrome, an anxiety that prevents you from urinating under pressure. However, as the Court of Appeals (Hall, Cabranes and Sullivan [D.J.]), noted, after the City notified Kinneary that he was going to lose his license to operate these vessels, "Kinneary took a number of proactive steps. He passed a blood test and a hair test. Kinneary twice wrote a City equal employment opportunity officer about the situation, but he never received a response to his inquiries."

The jury ruled in Kinneary's favor, awarding him back pay and damages for pain and suffering. The Court of Appeals reverses, holding that Kinneary was not qualified for his position because he was unable to pass the drug test and the reasonable accommodation that the City has in place for this problem -- a doctor's note containing certain particulars -- was not satisfied because his doctor's note did not affirmatively say that Kinneary "had a medical condition that did, or with a high probability could have, precluded Kinneary from providing a sufficient amount of urine for the test. Instead, the note simply stated the name of the condition, noted it was chronic and could be helped by an alpha blocker that Kinneary had been given, and indicated that Kinneary was not a substance abuser."

Even if it did not technically satisfy each requirement in the regulations, the doctor's note was good enough for the jury, probably because the note said that Kinneary's "medical condition" was "chronic." But the note was not good enough for the Court of Appeals, which also implicitly found that the alternative tests that Kinneary completed (blood, hair and saliva) were not enough to prevail at trial, even though these tests were reliable and confirmed that plaintiff was drug-free.

As an added bonus, the Court of Appeals drops a footnote that questions whether Kinneary's condition qualifies as a disability under the Americans With Disabilities Act. The jury said that Kinneary's Shy-Bladder condition was a disability. The Second Circuit is not so sure, stating (without conclusively resolving this issue):

Because Kinneary fails to make out this element of his claim, we need not and do not resolve here whether “shy bladder syndrome” can be a disability under the ADA. We did not reach this issue in Buckley v. Consol. Edison Co. of N.Y., because the plaintiff in that case had conceded that his bladder condition was not a disability under the ADA. 155 F.3d 150, 152 (2d Cir. 1998). We note that a U.S. District Court has said that, on the record before it, there was no evidence that shy bladder syndrome limited a plaintiff’s “ability to care for himself, perform manual tasks, or engage in other major life activities” and that the plaintiff before it, in opposing summary judgment, did not contend that the condition was an ADA disability. Balistrieri v. Express Drug Screening, LLC, No. 04-C-0989, 2008 WL 906236, at *5 (E.D. Wis. Mar. 31, 2008).

Thursday, March 18, 2010

2d Circuit strikes down parts of New York's attorney advertising rules

Goofball legal advertisements might make lawyers look bad, but the State of New York cannot prohibit them. That's the long and the short of a recent decision from the Second Circuit, which strikes down several provisions adopted by the state courts intended to prohibit potentially misleading ads and overly aggressive marketing.

The case is Alexander v. Cahill, decided on March 12. If you run a law office you should read this opinion. If you want to know why lawyers are allowed to run silly advertisements on television, you should also read this opinion.

Under the Central Hudson test, the state can regulate commercial speech to prevent misleading promotions. The government needs a substantial reason to regulate this speech. And the rules cannot be more extensive than necessary. This means that only false and deceptive speech can be regulated, along with unlawful activity. Since potentially misleading ads cannot be restricted, the state regulations on this point violate the First Amendment. Except that you cannot promise clients that some kind of "dream team" will try your case; the advertisements cannot suggest that lawyers not associated with the firm actually work for the firm.

The Court of Appeals takes on some of the other advertising provisions. Since client testimonials are not inherently misleading, the state can regulate them only if the ads say that past success in other cases indicate future performance. You can also have someone portray a judge in the ads so long as you are not suggesting that you can influence the court. While the state wants to prohibit ads that rely on irrelevant techniques to catch the viewer's attention, these advertisements cannot be regulated no matter how silly (the ad in this case showed the lawyers towering over New York City and representing space aliens). Irrelevant advertisements are not necessarily misleading. You can also use nicknames in promoting your law office, so long as they do not imply an ability to get results. The plaintiffs in this case referred to themselves as "heavy hitters." The First Amendment allows for this nickname, which does not mislead.

The Second Circuit also looks at rules that (with some exceptions) place a 30-day moratorium on certain advertisements, in particular those that prevent lawyers from seeking a specific client or group of clients through television, radio, newspapers and the Internet. Rules like this would apply when lawyers want to represent disaster victims. These rules are also constitutional. Persons who are targeted by lawyers during times of trauma are particularly vulnerable, and Judge Calabresi calls them the "Porcelain Hearts." He also upholds up the rules to preserve Wemmick's Castle (a Charles Dickens reference), that is, to temporarily prevent lawyers from sending letters to the homes of trauma victims. Borrowing from the Supreme Court's "7 Dirty Words Case" (FCC v. Pacifica Foundation, 438 U.S. 726 (1978), Judge Calabresi says that while Internet and other electronic solicitations are not quite like direct mailings, for purposes of this case, they are comparable in that the consumer is subjected to obnoxious advertisements which intrude on the home and therefore disturb domestic tranquility. The 30-day moratorium is legal.

Wednesday, March 17, 2010

Despite "note of caution," Court rejects Title VII arbitration challenge

It is not easy to challenge an arbitration clause. Employers like them because workers sign them in order to start a new job, and the clauses require them to litigate any employment disputes out-of-court, a much less expensive proposition for the employer. Rita Ragone learned just how hard it is to challenge these clauses.

The case is Ragone v. Atlantic Video, decided on February 17. When Ragone sued her employer in court for employment discrimination, management invoked the arbitration clause, which required her to submit to binding arbitration. The clause also limited her statute of limitations, required her to pay management's legal fees if she lost the hearing and limited her pre-hearing discovery.

These are some pretty dramatic provisions. Which is why management decided not to enforce some of them, namely the statute of limitations and attorneys' fee provision. They also waived the provision that prevented Ragone from appealing any adverse arbitration provision to federal court. Smart move. Without these provisions, Ragone's argument in the Court of Appeals that the arbitration agreement is unconscionable and therefore unenforceable fails. Unconscionability arguments are hard enough to win without management waiving the more draconian provisions. While Ragone also argues that the agreement as a whole is unconscionable because it "contain[ed] numerous unconscionable and oppressive terms, is irredeemably tainted by unconscionability and unlawful purpose," the Court of Appeals rejects what it calls "not an inconsiderable argument" in finding that New York contract and arbitration law would deem the agreement modified in light of management's decision to waive the more oppressive provisions.

The Court of Appeals (Pooler, Hall and Livingston) does bless us with a "note of caution" in emphasizing that it finds for the employer in this case "with something less than robust enthusiasm." (Double negatives are common in federal rulings, by the way). The Court says that the arbitration agreement would not necessarily be legal had management not decided to waive the oppressive provisions. In particular, the Second Circuit does not like the tight statute of limitations and attorneys' fees provision which contravenes settled law that unsuccessful plaintiffs pay the defendant's fees only when their cases are completely frivolous.

An interesting note for those of you who like street language in federal court opinions. Ragone argued that she was forced to "take it or leave it" when management asked her to sign the arbitration clause. But as the Court of Appeals notes, this will not support an unconscionability argument. She also argued that she did not read the agreement before signing it. Here's a quiz for everyone: in light of what we know about how difficult it is to challenge arbitration agreements, how do you think the Court of Appeals resolved this particular argument?

Monday, March 15, 2010

Bergstein & Ullrich prevail in student harassment case

Pine Plains school found liable in racial harassment suit

By John Davis • Poughkeepsie Journal
March 13, 2010

PINE PLAINS — A jury has decided the school district must pay the parents of a former student at Stissing Mountain Junior-Senior High School $1.25 million due to its "indifference" to the racial harassment he endured for more than three years.

The jury in federal court in White Plains rendered a verdict Friday afternoon in favor of Henry and Cathleen Zeno, parents of Anthony Zeno, 21, of the Town of Pine Plains.

The jury found Pine Plains school district officials did not take sufficient remedial action to address complaints made by Anthony Zeno of racial harassment by students during his years as a student from January 2005 to June 2008, according to Zeno family attorney Stephen Bergstein.

The Pine Plains school board released a statement this afternoon.

The statement said board members, the administration, faculty and staff have always given the physical and emotional safety of students the highest priority. "There is zero tolerance for racial, or any other form of of bullying or harassment, in our school community," the board said.

"The jury in the Zeno v. Pine Plains CSD case found our immediate discipline of students and our sustained cooperation with Dutchess County law enforcement, our student and community training and awareness program (including those of McGrath Systems and Mr. James Childs of JaRa Consulting), our student assembly programs addressing issues of diversity awareness, our conflict resolution and mediation efforts, our character education programs specifically targeting racial issues, our Students and Teachers Opposed to Prejudice (STOP) programs, and our daily, individual work with students, to be insufficient," the board said in the statement.

"Given our deeply held commitment to and advocacy for social justice, we are stunned by the jury's verdict," the board said.

"His high school years were destroyed," Bergstein said. "The jury found he endured 3 years of living hell."

The Zenos moved from Long Island to Pine Plains in 2005. Henry Zeno is Latino and Cathleen Zeno is white, Bergstein said. Anthony is "very dark skinned," which led to him being taunted by white students at Stissing Mountain with racial epithets and racially motivated threats, he said.

The trial, which began Monday, included testimony from Kaumeyer, John Howe, the former high school principal, and Maryann Stoorvogel, director of special education, Bergstein said.

"If they're deliberately indifferent to the harassment, then they're liable," he said. "The school was very flat-footed on this. They were just slow to respond."

Civil Rights verdict costs Pine Plains district $1.25M
Saturday, March 13, 2010

Kingston Freeman staff

A PINE PLAINS family was awarded $1.25 million in damages Friday after a jury found that the Pine Plains school district failed to adequately protect their son from racial harassment by his peers, a violation of the federal Civil Rights Act of 1964.

The case, heard in U.S. District Court in White Plains, was filed by Henry and Cathleen Zeno, the parents of Anthony Zeno, who graduated from Stissing Mountain Senior High School in Pine Plains in 2008.

The family had moved to Pine Plains from Long Island in 2005, and Anthony, who is dark-skinned and multi-racial, began attending high school in January of that year.

Almost immediately, racial epithets and harassment started against Anthony, said Stephen Bergstein, the Chester-based attorney who represented the Zeno family.

“He underwent relentless racial harassment there. Till the day he ended school there, there were attacks, violence and even a death threat in the bathroom,” Bergstein said, adding that one student even brought in a noose at one time.

“Kids were heard saying ‘nigger’ in the hallway. His high school career was really destroyed. He was terribly damaged by it,” Bergstein said.

The Zeno family made repeated efforts to get the harassment to stop, Bergstein said, including writing letters to officials and appealing to district Superintendent Linda Kaumeyer.

Bergstein said the school tried on several occasions to address the problem, including bringing in the Rev. James Childs as a diversity trainer, but he said it was “too little too late.”

“It took the school a long time to bring in the Rev. Childs, and while they were punishing kids, (the harassment) wasn’t stopping. You have to find more proactive ways to deal with the problem,” he said.

The jury deliberated for seven hours before reaching a verdict in favor of the Zeno family.

“The jury found that the school district was deliberately indifferent,” Bergstein said. “They were astounded at the level of racial discrimination that was going on in that school.”

The Pine Plains school district was represented by the Poughkeepsie law firm of Shaw and Perelson.

School officials did not comment on the matter and referred all inquiries to their lawyers, who did not return phone calls in time for this report.

“The $1.25 million (in damages) is a large amount of money,” said Bergstein. “Boy, does that send a message to the school.”

Wednesday, March 10, 2010

How not to write a complaint these days

The days of "notice pleading" are over. Notice pleading under the Federal Rules of Civil Procedure meant that the Complaint that initiates a lawsuit did not have to provide too many details, just enough information to put the defendant on notice of the allegations against it. But, like I said, the days of "notice pleading" are over. These days, it's all about Iqbal pleading.

The case is Sanders v. Grenadier Realty, Inc., a summary order decided on February 22. This is a housing discrimination case. As the Court of Appeals tells us,

Plaintiffs submit that the following allegations adequately state that defendants intentionally discriminated against them based on race: (1) “Upon information and belief, non-black residents have been granted subsidies and re-certifications while plaintiffs have been denied the same in the same period,” Amended Complaint ¶ 17; and (2) “In light of the foregoing therefore, the defendants discriminated against plaintiffs on account of their race and national origin in violation of Title VIII, and sections 1982 and 1981,” id. ¶ 26.

Under Iqbal pleading (named after a Supreme Court case from 2009 which tightened pleading requirements), the plaintiff has to allege a plausible claim, not merely a possible claim. Conclusions (sometimes good enough under notice pleading), are not enough anymore. The above snippet from the complaint doesn't cut it. The Court of Appeals (Calabresi, Raggi and Cuhady [D.J.]), says that "While paragraph 17 does allege facts consistent with a discrimination claim, i.e., that non-black residents were granted subsidies, it nevertheless 'stops short of the line between possibility and plausibility of entitlement to relief,' because plaintiffs do not allege any facts supporting an inference of racial animus."

The complaint also alleges that plaintiffs were “refused a recertification that would [have] granted [them] much needed rent subsidies' in violation of the [Fair Housing Act]. Amended Complaint ¶ 11." This is not going to cut it either. The Second Circuit concludes that the complaint does not adequately allege that plaintiffs “were qualified to rent or purchase the housing,” a necessary requirement for bringing a claim. This is because it only makes only the following conclusory assertions:

(1) “Sanders was ... denied the right to subsidies that she is entitled to,” Am. Compl. ¶ 12, and (2) “At all times plaintiffs were competent and able to pay their rent under the subsidies offered to [them] under the National Housing Act,” id. ¶ 15.

Why does this allegation fail under Iqbal ? The Court of Appeals says that because "a necessary precondition to rent subsidies is a resident’s submission of required reports as to her income and household composition within ten days of the landlord’s written request. Because plaintiffs have not alleged satisfaction of this requirement for the year at issue, we cannot conclude that the complaint plausibly alleges plaintiffs’ entitlement to the subsidies that qualify them to pay their rent. In light of this omission and plaintiffs’ failure to allege what defendants did or did not do to deny them subsidies, we identify no error in the district court’s dismissal of plaintiffs’ FHA claim."

It's possible that the plaintiffs in this case have a real claim. But the rules have changed. It's an Iqbal world now. Notice pleading is dead. The case is dismissed.

Monday, March 8, 2010

Equitable tolling revives habeas corpus action

You have one year to bring a habeas corpus action, thanks to a 1996 law intended to reign in habeas petitions. That deadline is sacrosanct for convicts and their lawyers. Are there any exceptions to this deadline? Yes, the Court of Appeals holds.

The case is Bolarinwa v. Williams, decided on January 28. Bolarinwa was convicted of killing her son. At trial, she called seven experts to say that she was not guilty by reason of mental disease or defect. After she lost all her appeals in the state court system, she brought what we call a "440 motion" named after the provision in the Criminal Procedure Law which allows you to attack your conviction after-the-fact, on the basis that a juror was sleeping during the trial and there was insufficient evidence of her guilt. That effort failed and she then brought a habeas action in federal court.

Bolarinwa had a timeliness problem, the district court held, because the habeas petition was brought outside the one-year statute of limitations. Her argument was that she could not file it any earlier because of her mental illness. The Second Circuit has not handled this issue before, but it resolves it now. Following the lead of other federal circuits which have granted equitable tolling of the statute of limitations on mental illness grounds.

The general rule is that "a litigant seeking equitable tolling must establish two elements: (1) that he has been pursuing his rights diligently, and (2) that some extraordinary circumstance stood in his way and prevented timely filing. Accordingly, this Court has clearly stated that the ... limitations period will only be tolled in 'rare and exceptional circumstance[s],' and where the petitioner demonstrate[s] a causal relationship between the extraordinary circumstances . . . and the lateness of his filing, a demonstration that cannot be made if the petitioner, acting with reasonable diligence, could have filed on time notwithstanding."

As mental illness has extended deadlines in the employment discrimination context (filing EEOC complaints, for example), it can apply here, also, if the facts warrant it. The case is remanded to the district court to consider this matter anew.

Thursday, March 4, 2010

2d Circuit rejects "common fund" method in awarding class action attorneys' fees

The Court of Appeals holds in a class-action settlement case that the district court can award attorneys' fees based on the traditional lodestar method rather than the common-fund model.

The case is McDaniel v. County of Schenectady, decided on February 16. The County settled a class action alleging that the County jail was strip searching inmates in violation of the Constitution, a practice that the Second Circuit deemed illegal in 2001. The settlement fund for aggrieved class members was $2.5 million. The parties agreed that plaintiffs' counsel would recover up to 26 percent of that fund in attorneys' fees, or $650,000. This is how many class actions are often resolved, but the trial court here applied a variant of the Second Circuit's recent Arbor Hill v. County of Albany, 522 F.3d 182 (2d Cir. 2008), which articulates a variety of factors, including the attorney hours expended and their hourly rates, in assessing a reasonable fee award. Under Arbor Hill, courts also bear in mind that "a reasonable paying client wishes to spend the minimum necessary to litigate the case effectively” and that a paying client's negotiating position may be strengthened by the attorneys’ “desire to obtain the reputational benefits that might accrue from being associated with the case.” This model will drive down attorneys' fees awards (since the hypothetical client will want to pay as little as possible), but that's a topic for another day.

The trial court awarded plaintiffs' counsel $344,795, holding that the case was not particularly complex, counsel had worked on similar cases in the past (which means "some of the ground work for this litigation was already established") and the trial court "took note of the compelling public policy issues for keeping an eye on attorneys' fees in class action cases." In the end, this reasoning is a departure from the way that attorneys' fees in class actions are typically awarded.

The Court of Appeals (Livingston, Walker and Kaplan, D.J.) affirms, however, noting that the trial court has discretion to resolve attorneys' fees disputes and that the Second Circuit has authorized this method in the past. The Court further rejects plaintiffs' argument that the more lucrative common-find approach should be the presumptive method in class actions. Other Circuit courts have agreed with this argument, but the Second Circuit will not.

Of interest to litigators, the Court then sets out the limitations and advantages of both the lodestar and common-fund methods:

The lodestar method is not perfect. It creates an incentive for attorneys to bill as many hours as possible, to do unnecessary work, and for these reasons also can create a disincentive to early settlement. Under certain conditions, moreover, lodestar awards can create the near opposite incentive, encouraging attorneys to settle before trial even when it is not in their clients’ best interest. While under the lodestar method lawyers share the “downside” risk of trial (i.e., the possibility of an adverse judgment, and hence no fee), they do not share in the potential economic “upside” (i.e., fees as a percentage of a large common fund), especially since trial requires comparatively fewer hours than the process of trial preparation. Although the district court is charged with ensuring the fairness of a proposed settlement, including any lodestar-based attorneys’ fee award, this task is often challenging in common fund cases, especially because – since the attorneys’ fees are drawn from a common fund rather than being paid separately by the defendants – there is little incentive for the defendants to contest the size of the fee. To the contrary, plaintiffs’ and defendants’ lawyers share an interest in the approval of an agreed upon settlement. As a result, the district judge “los[es] the benefit of an adversarial process, which may . . . inform[] and sharpen[] the judicial inquiry.”

But the percentage method has its limitations as well. [T]his Circuit’s adoption of the lodestar method was precipitated by the perception that percentage fees “tended to yield too little for the client-class, and an unjustified ‘golden harvest of fees’ for the lawyer.” Particularly in cases that result in a very large monetary award, the percentage method holds the potential to result in attorneys’ fees many times greater than those that would have been earned under the lodestar of hourly rate multiplied by hours worked. “The principal analytical flaw” in Appellants’ argument for a presumptive percentage award as a “benchmark” in common fund cases lies in the “assumption that there is substantial contingency risk in every common fund case” that would justify such a multiplier. Moreover, although the percentage method has the advantage of aligning the interests of plaintiffs and their attorneys more fully by allowing the latter to share in both the upside and downside risk of litigation, it can create perverse incentives of its own, potentially encouraging counsel to settle a case prematurely once their opportunity costs begin to rise. And as in the case of the lodestar method, neither defense counsel nor the actual plaintiffs have much of an incentive under the percentage-of-fund approach to oppose an award of attorneys’ fees, the latter since “[t]hey have no real incentive to mount a challenge that would result in only a ‘minuscule’ pro rata gain from a fee reduction.”

These competing arguments for and against the lodestar and common-fund methods of awarding attorneys' fees convince the Court of Appeals that the district court (which is most familiar with the case) is in the best position to fashion a fee award, and that it did not abuse its discretion in awarding plaintiffs' counsel $344,000. The Second Circuit seems to believe that this case was not that complex in light of the state of the law at the time the strip searches were challenged and counsel's groundwork in litigating similar cases in other counties. For these and other reasons, the trial court did not commit reversible error in applying the 12 Arbor Hill factors in awarding fees. While Arbor Hill involved statutory fees and the case against Schenectady County's strip searches is a common fund case arising from a constitutional dispute, the Court of Appeals rejects the "assumption that the lodestar method employed in the common fund context is distinct from that employed in the statutory context."

Monday, March 1, 2010

It should be a hell of a trial

It looks like Diane Gorzynski hit the employment discrimination trifecta in her case decided by the Court of Appeals on February 19. Gorzynski's case produced a more plaintiff-friendly standard interpreting the Faragher affirmative defense in sexual harassment cases. She also won herself a new trial on her age discrimination case, as outlined here. And also gets a trial on her racial, age and gender retaliation claims. Sexual harassment, age discrimination, and retaliation in the same case! You don't see that very often.

The case is Gorzynski v. JetBlue. The sexual harassment angle is here. The age discrimination angle is here. Here's the retaliation.

The Court of Appeals' retaliation analysis does not break new ground. The panel cites some leading retaliation precedents and applies those settled legal standards in reversing summary judgment in Gorzynski's case. On her racial retaliation claim, the Court finds that she engaged in protected activity in standing up for an African-American co-worker, who was allegedly passed over for a promotion because of his race. As plaintiff was fired one month after she spoke out, the timeline is close enough to draw the retaliatory inference. She also has a retaliation case on her complaints about age discrimination. Gorzynski complained about disparate treatment in favor of younger workers who were violating airline policy with impunity. In granting summary judgment, the district court overlooked her affidavit stating that "there was unequal enforcement of the rules at the Buffalo station with respect to older employees versus younger employees." As she was fired less than four months later, Gorzynski has a retaliation claim for complaining about age discrimination.

So we got ourselves two retaliation claims based on complaints about racism and ageist practices. But that's not all. Gorzynski also has a retaliation case based on complaints about sex discrimination. She complained when the guy who sexually harassed her told an airplane full of passengers (over the loudspeaker)that Gorzynski "was a former table dancer and that another crewmember was a former pin-up girl." This complaint took place about two months before Gorzynski was fired.

The prima facie cases for race, age and gender retaliation take us to the pretext analysis. Since JetBlue's reasons for terminating Gorzynski were pretextual (as outlined in the context of her disparate treatment claim), these claims go to the jury as well. In the end, Gorzynski has a (1) sexual harassment claim; (2) an age discrimination claim; (3) a racial retaliation claim; (4) an age retaliation claim and (5) a gender retaliation claim. Should be a hell of a trial.