Tuesday, May 20, 2014

Bergstein & Ullrich prevail in state-law whistleblower case

The New York State Court of Appeals has breathed some life into the whistleblower law, under which most cases fail because the plaintiff must satisfy narrow requirements in order to prove that she was terminated from her position for speaking out against public health and safety violations at work.

The case is Webb-Weber v. Community Action for Human Services, decided on May 13. I briefed and argued the appeal in the Court of Appeals. Under the law, an employee cannot suffer retaliation for disclosing or threatening to disclose to a supervisor or to a public body any of the employer's activities that violate a law, rule or regulation and either "creates and presents a substantial and specific danger to the public health and safety, or constitutes health care fraud." Seems simple enough, but read the law carefully and you'll see the many ways that courts have ruled against plaintiffs in these cases. Either the employer's bad practices are not actually illegal, or the practices do not "create a substantial and specific danger" to public health and safety.

This case got dismissed for a different reason. The mid-level appeals court in New York required the plaintiff in her lawsuit to cite the laws, rules or regulations. Without this chapter-and-verse, the case would be dismissed. Plaintiff's first lawyer (not me) did not cite the rules in the Complaint. The First Department threw out the case for that reason. The Court of Appeals reverses and reinstates the Complaint.

The plain language of Labor Law § 740 (2) (a) does not impose any requirement that a plaintiff identify the specific "law, rule or regulation" violated as part of a section 740 claim. Subdivision 2 (a) prohibits an employer from taking retaliatory personnel action against an employee because she either discloses or threatens to disclose the employer's "activity, policy or practice." The reasonable interpretation is that, in order to recover under a section 740 claim, plaintiff must show that she reported or threatened to report the employer's "activity, policy or practice," but need not claim that she cited any particular "law, rule or regulation" at that time.
The Court of Appeals also says that plaintiff makes out a claim because the allegations in the Complaint suggest that she spoke out about serious dangers to public health and safety. The Court of Appeals says,

According to the amended verified complaint, plaintiff apprised Bond and other Community Action representatives about issues she claims endangered the welfare and safety of Community Action patients. Specifically, plaintiff registered complaints about the falsification of patient medication and treatment records, inadequate fire safety, mistreatment of Community Action residents, and deficiencies in patient care and in the facility itself. When those conditions continued unabated, plaintiff notified the OMRDD and the New York City Fire Department. The OMRDD conducted a survey of the Community Action premises and issued a "60-Day Order"; when a follow-up survey indicated that the violations had not been remedied, Community Action was placed under sanctions by the New York State Department of Health. Moreover, the New York City Fire Department issued three violations against defendants.
These allegations allow plaintiff to proceed with discovery. "The substantive allegations in the complaint, particularly those that assert that sanctions and violations were issued by public bodies, allegedly as a result of plaintiff's complaints, sufficiently support plaintiff's allegation that defendants violated various laws, rules or regulations. Moreover, defendants can request in a bill of particulars that plaintiff identify the particular laws, rules and regulations allegedly violated."

I believe this is the first time the Court of Appeals has defined "health and safety" violations under the state whistleblower law. While the decision does not go into detail about the problems at the facility, it provides some guidance into which cases will fly. It also suggests (contrary to some lower court rulings) that health and safety problems inside the facilities are sufficiently "public" under the law.

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