Second Circuit reinstates racial discrimination case

The Court of Appeals has reinstated a racial discrimination lawsuit, holding that the plaintiff alleged enough facts in her complaint to plausibly assert that she was denied a promotion and then terminated from her position because of her race.

The case is Brooks v. Bright Horizons, a summary order issued on June 10. I represented the plaintiff on appeal. Keenan & Bhatia handled the case in the district court.

Plaintiff is Black, and her supervisor is white. Plaintiff alleges the white supervisor singled her out for mistreatment, as compared to her white co-workers. When plaintiff put in for a promotion for which she was qualified, someone else was chosen for the position; the selectee was not Black. According to the lawsuit, the selectee was not qualified for the position, as he lacked some of the prerequisites set forth in the job posting. When Plaintiff asked why she did not get the position, her supervisor said that she needed more experience supervising people who are "not like you." In explaining further, the supervisor mentioned an Asian-American director and another employee who is a non-Black Latina. Plaintiff was later fired. That same supervisor orchestrated her termination, claiming that plaintiff did not comply with COVID protocols, even though one of plaintiff's white subordinates who made the decision that broke the protocol was not disciplined. A white woman replaced plaintiff.

The Court of Appeals applies a settled rule in reinstating the failure-to-promote and termination claims: if the promotion is given to someone outside the protected class, and if you are fired and replaced by someone outside the protected class, that's a prima facie case, and if you plead a prima facie case, then the case cannot be dismissed. The Second Circuit more recently articulated this rule in Littlejohn v. City of New York (2015). The Court did not address whether the "not like you" comment carried a racial implication, though the Court did cite that allegation in the statement of facts.

If the cases are settled that plaintiff plead a prima facie case, then why was the case dismissed? Because some district courts, and a few Second Circuit summary orders (which are not precedential) are now holding that replacement by someone outside the protected class is not always enough to make out a prima facie case. No published Second Circuit holds as such. Here is how the Second Circuit (Nardini, Lee and Robinson) handled that issue:

The district court acknowledged our holding in Littlejohn, but relied on a subsequent summary order of this Court to conclude that we had “more recently cautioned that the succession of an employee by a person outside the protected class, standing alone, cannot give rise to a plausible inference of discrimination.” Joint App’x at 102 (citing Marcus v. Leviton Mfg. Co., Inc. 661 F. App’x 29, 32 (2d Cir. 2016) (“Without more, the mere fact that an older employee was replaced by a younger one does not plausibly indicate discriminatory motive.”)). But Marcus did not—indeed could not—undermine what we held in Littlejohn. Procedurally, a summary order is nonbinding, and even a published opinion of a later panel cannot override the published opinion of an earlier panel. In any event, we discern no tension between our two decisions. In Marcus, we were addressing what we described as “skeletal pleading” in a complaint that alleged simply on “information and belief” that the plaintiff had been replaced by a younger employee, without any supporting facts—not even the purported age of the new employee. 661 F. App’x at 32-33. Brooks’ amended complaint is far more detailed and alleges specifics about differential treatment that was accorded to her and a similarly situated employee of Bright Horizons.

What we see is a principle, still unavailable in any published case, that replacement by someone outside the protected class may not be enough to avoid Rule 12 dismissal, but only if there is skeletal pleading that does not otherwise suggest an inference of discrimination. The rule in  Marcus is still the exception. The general rule guiding Iqbal pleading is to write a detailed complaint no matter what. If you've got it, plead it. 

 

Bad court reporter! Bad!

During the criminal trial, the court reporter was unable to capture substantial portions of the trial proceedings. So the stenographer instead recorded, "blah, blah, blah," "blah blah," "omitted," or undecipherable characters instead of the words actually spoken. This is what you read if you were going through jury selection, portions of the trial, jury notes and the verdict. The problem is you need a real transcript for the appeal. 

The case is People v. Meyers, issued by the New York Court of Appeals on May 26. The half-elbowed transcripts surfaced when defendant -- who was convicted of orchestrating a house fire in order to win someone's life insurance -- took up an appeal. I am sure panic ensued when the appellate lawyer realized the transcripts contained all the nonsense. Here is a sample of what the transcript looked like, when the trial judge addressed the jury:

"A trial jury is composed of 12 people. In addition to the 12 jurors, we also, blah, blah, sworn in as a trial juror will serve as the jury's foreperson. You've heard reference to the fact that the defendant was indicted by a grand jury. This is not and must not be taken guilty you, blah, blah, trial jury must consider an indictment by, blah, blah, accused of a crime. Only you as members of the trial jury can determine guilt. A defendant is presumed innocent and until you (untranscribable) find him guilty." 

You can "yada yada yada" your way through a Seinfeld plot but you can't "blah, blah, blah" you way through a criminal trial.  

The trial court held a four-day reconstruction hearing, during which the court heard testimony from the trial judge who presided over the case, the judge's law clerk, all the lawyers who handled the case, and collected notes taken from judge during trial. The hope was that the court could reconstruct what actually happened at trial besides "blah, blah, blah." 

The case reached the New York Court of Appeals on the theory that defendant deserved a new trial because he did not have a proper trial record. But the Court holds that the reconstruction hearing was adequate and other, non-stenographic evidence, was preserved, including video of defendant and his wife visiting the home right before the fire and removing bags of materials from the home, presumably the stuff that defendant did not want burned into oblivion. As for the reconstructed trial record, defendant has not shown any appealable issues relating to those portions of the trial that were not adequately recorded by the court reporter. 

Second chance for murder defendant due to potential Batson violation

At this criminal trial, the prosecutor used his peremptory challenges to remove a series of Black jurors from the case. The criminal defendant was convicted of capital murder but challenged the fairness of the trial due to what he claimed was the racially-motivated jury selection process. He wins in the Supreme Court.

The case is  Pitchford v. Cain, issued on May 28. Never let anyone tell you that a conservative Supreme Court does not always rule in a liberal manner. This is a 5-4 decision, with Justices Kavanaugh and Roberts voting with the three liberals.

In this case, during jury selection, the prosecutor struck four potential jurors, all of them Black. The defendant's lawyer objected on Batson grounds. Under Batson, named after a Supreme Court ruling from 1986, upon such an objection, the prosecutor has to articulate a race-neutral reason for striking the Black jurors. The judge then has to decide -- on the spot -- if that justification is a pretext, or a knowingly false reason. The prosecutor does not have a heavy burden in defending his choices, but this procedure must be followed.

Although the jury convicted the defendant of murder, yielding a 20-year sentence, the Supreme Court grants the habeas corpus petition, holding that the state courts did not reasonably apply Court precedent on this issue. Remember that habeas petitions are not granted simply because the state court did something unconstitutional during trial. The criminal defendant has to show the state court did not reasonably apply Supreme Court precedent. As Justice Gorsuch writes in dissent, "showing legal error . . . isn't enough to satisfy [the habeas statute]. Instead, a petitioner must demonstrate that no fairminded jurist could reach the state court's conclusion under this Court's precedents." So a mere constitutional violation is not enough. The habeas equation, in my view, is one of the greatest anomalies in federal law. But that's a lecture for another day.

What went wrong at the criminal trial was this: the criminal court judge said the prosecutor articulated a neutral reason for striking the Black jurors, but it did not afford defense counsel a chance to rebut the prosecutor's race-neutral reasons as pretextual. Nor did the criminal court make any findings regarding whether the prosecutor's reasons were a pretext for race discrimination. When jury selection ended, defense counsel again raised an objection, to no avail. The trial court cut him off. The defendant gets another shot at challenging the prosecutor's actions, potentially leading to a new trial with a fresh jury. Hey, everyone deserves a second chance, right?

 

 

Supreme Court narrowly interprets Federal Arbitration Act for intrastate bakery drivers

The Supreme Court last week narrowly interpreted the Federal Arbitration Clause -- which favors arbitration and usually produces court rulings for management, which does not want cases in court but instead through the private arbitration process -- to mean that certain bakery and junk food drivers cannot be forced into arbitration when management denies them a proper paycheck.

The case is Flowers Foods v. Brock, issued on May 28. Under the FAA, you cannot compel arbitration in disputes involving the "contracts of employment" of any class of workers "engaged in ... interstate commerce." Since Flowers distributes food all over the country, requiring its drivers to cross state lines, the question is whether the plaintiffs may pursue their claims in open court instead of arbitration -- which will grant you a ruling, albeit on an expedited basis with more limited discovery, no jury, and where the arbitrators' rates are often paid by the employer. See why plaintiffs don't like arbitration? They dislike arbitration so much that they will take this issue to the Supreme Court (an expensive and time-consuming process), which issues a ruling long after the arbitrator might have resolved the case once and for all.

What makes this case unique is that plaintiff did not actually cross state lines in delivering the baked goods. Instead, his "intrastate route formed a constituent part of the ... interstate journey of Flowers's goods from out-of-state bakeries to their intended destinations at retain stores." On these facts, can plaintiff still avoid arbitration under the statute? A unanimous court rules that, under the FAA, workers qualify as engaging in interstate commerce even if they never cross state lines and never interacts with vehicles who cross state lines. That's plaintiff Brock. He gets to litigate his wages claim in court, not arbitration.

The Supreme Court reaches this holding after analyzing, through dictionaries, what certain language in the FAA really means, words like "engage," which the dictionary interpreted to "take part in something or to be employed or involved in that thing." "Engage" has a broad definition, and we presume that Congress had that broad definition in mind when it enacted the FAA many years ago. 

Justice Gorsuch writes that "nothing in those terms requires an individual to cross state lines or to interact with a vehicle that does. "Interstate commerce includes transporting products between points in one state and points in another state. That involves not just crossing state lines, but intrastate activity too. Though a continuous carriage may begin in one State and end in another, much of the journey can take place within the limits of a single state. And at least sometimes, a person can take part, be employ[ed], or be involve[d] in that continuous journey without leaving a State or touching vehicles that do." No case law supports this holding, by the way. It all comes from what must be a hell of a dictionary collection at the U.S. Supreme Court library. I say this because the Court often reviews the dictionary -- including those published at or around the time a certain statute was enacted -- to understand what Congress must have intended in enacting certain statutes.

This case is the fourth in a recent like of cases narrowly interpreting the FAA to exempt certain transportation industry workers from mandatory arbitration. The Court writes:

In recent years, we have had occasion to address the scope of §1’s exemption no fewer than three times. In each case, we have rejected efforts to cabin its reach. First, in New Prime Inc. v. Oliveira, 586 U. S. 105 (2019), we held that the “contracts of employment” §1 embraces include contracts governing independent contractors, not just employees. Then, in Southwest Airlines Co. v. Saxon, 596 U. S. 450 (2022), we held an airline worker who loaded and unloaded cargo fit within §1’s exemption even though she did not fly planes or otherwise cross state lines. Finally, in Bissonnette v. LePage Bakeries Park St., 601 U.S. 246 (2024), we held that a worker can fall under §1 whether he is employed in  the “transportation industry” or some other, so long as his work “play[s] a direct and necessary role in the free flow of goods across borders.” Make this case the fourth.

$76,000 First Amendment verdict is taken away

This case has been kicking around for quite some time. The plaintiff argues that the Town of Babylon (on Long Island) accused him of violating the Town's rental permit requirements in violation of the First Amendment (he claimed the Town retaliated due to his free speech) and due process. The First Amendment claim survived pre-trial motion practice, and the case -- originally filed in 2012 -- went to trial in 2019. Plaintiff won the trial. But things did not end with that victory. Oh Lord, they did not.

The case is Mangino v. Town of Babylon, a summary order issued on May 29. The retaliation theory was that the Town denied approval of his rental permit and initiated civil enforcement proceedings against him because he had previously objected to the Town's fee practices and enforcement methods. So, the kinds of issues that normally play out in state court -- zoning, etc -- became a federal lawsuit due to plaintiff's First Amendment claim. The jury ruled in plaintiff's favor, awarding him approximately $76,000 in damages. 

But wait! The trial court set aside the verdict as agains the weight of the evidence and ordered a second trial. This time around, the Town won the case. Plaintiff now appeals from the earlier order throwing out the favorable verdict. He loses the appeal. 

The Court of Appeals (Walker, Lee and Robinson) reviews that order under the "abuse of discretion" theory, which is highly favorable to the trial court. Appellate courts give the trial judges the benefit of the doubt in making these rulings. The trial court is in the best position to know if the evidence really supports the verdict and whether the interests of justice warrant a new trial. This case is no different. The Second Circuit holds that the trial court "carefully reviewed both testimonial and documentary evidence and concluded that the first verdict could not be reconciled with the record." The trial court found that the verdict simply could not be supported by the trial evidence, which had serious holes in it, the Court of Appeals finds.

We tell juries that they are the ultimate arbiter of the case and that we trust their judgment. When the jury renders its verdict, it leaves the courthouse believing the case is over and they did their job. The jury has no idea the case continues while the judge and the attorneys -- and maybe even the Court of Appeals -- picks through the evidence to see if the jury got it right. This case is a good example of that. It is uncommon for the trial judge to set aside a plaintiff's verdict on these grounds, but it does happen. The lawyers may understand the trial court's reasoning in ordering a new trial after the plaintiff has already prevailed. My guess is that plaintiffs will always be confused about what happened: we won the trial, the trial judge took away the verdict, we had a second trial, and a new jury ruled against us. 

Disparate impact case for social workers' licensing exam is rejected on appeal

This race discrimination claim alleges that the licensing exam for certain social workers discriminates on the basis of race because Black and Hispanic test-takers perform significantly worse than white candidates but that the Association of Social Work Boards, which administers the tests, knew about these disparities but did not correct them, resulting the plaintiffs' failing test scores. The case loses even prior to the commencement of discovery.

The case is Alameda v. Association of Social Work Boards, a summary order issued on May 15. This is a disparate impact case, where the plaintiffs can win even if the testing board did not intend to discriminate on the basis of race. For a disparate impact case to succeed, however, the plaintiffs have to satisfy a demanding legal standard that employs statistics and particular formulas. But first we have a mundane legal issue under Title VII: can the plaintiffs even sue the testing company under this civil rights statute?

Under Title VII, you can only sue the employer for discrimination. The testing people were not plaintiffs' employers. Cases hold that you can hold a third-party liable under Title VII where your formal employer "has delegated one of its core duties to a third party." But the Second Circuit (Perez, Nathan and Katzmann [Court of Intern'l Trade]) finds the defendant here is not such a "third party" that would create an employee-employer relationship under Title VII. 

Plaintiffs also sue under Section 1981, which prohibits racial discrimination in making contracts. There is no employee-employer relationship requirement under Section 1981 in this case, but plaintiffs lose on a different ground relating to the merits of the case: they have not plausibly alleged a disparate impact claim.

Plaintiffs rely on statistics to assert their case, pointing to the disparate test results among white and Black and Latino/a test-takers. But under the cases, to assert such a claim based on statistics alone, you have to show the statistical disparity is "of a level that makes other plausible nondiscriminatory explanations very unlikely." In other words, you need a dramatic statistical disparity. The Court holds that the statistical disparities here do not satisfy that demanding test.

First Department reinstates sex discrimination case

The Appellate Division has reinstated a sex discrimination case against a securities firm on the basis that the case is not untimely and the plaintiff can argue that her termination was the product of a continuing violation. This is a useful ruling for employment discrimination plaintiffs under the New York City and State Human Rights Laws.

The case is Farmer v. Mizuho Securities, LLC, issued on May 12. Plaintiff claims the brokerage firm assigned her a smaller percentage of the market and a lower risk limit compared with male colleagues, and that a supervisor made disparaging comments about her appearance and suggested that she use her gender to gain favor with male colleagues. After plaintiff complained to HR about this, the supervisor vowed to get her fired, and he disparaged her job performance to others at the firm, calling her a cheater. She was forced to resign against her will. 

While the lower court dismissed the case on the pleadings, the First Department holds the plaintiff has a viable case, noting that pleading standards under the City law are lenient in discrimination cases, in contrast to the federal system, where cases are dismissed under a more exacting test thanks to the Supreme Court's dual rulings in the late 2000's, Twombly and Iqbal. "Given the allegations that defendant terminated plaintiff following months of consistently disparate treatment, plaintiff adequately pleads a causal connection between the disparate treatment and the termination. In addition, plaintiff's allegation that defendant falsely characterized its decision to end her employment, stating that it was a voluntary departure, further raises an inference of discrimination."

In emphasizing that federal pleading standards do not apply in state practice, the First Department says out loud what few state appellate rulings have overtly said on this topic, though the understanding that Iqbal pleading does not apply under the Civil Practice Law and Rules.  

The hostile work environment claim is also reinstated. While the lower court said this claim fell outside the statute-of-limitations, "the complaint, as pleaded, sufficiently alleges that the termination was the culmination of a single continuing pattern of discriminatory or retaliatory conduct extending into the limitations period, thus linking the wrongful conduct to the termination. It cannot be said as a matter of law that [the] alleged discriminatory and retaliatory acts . . . were not part of a single continuing pattern of unlawful conduct extending into the three-year period immediately before the filling of the complaint."

The First Department further holds that plaintiff's termination falls within the continuing violations rule, rejecting the trial court's ruling that her termination should be considered legally distinct from other kinds of gender-based treatment. The Court observes, "The City HRL focuses on unequal treatment regardless of whether or not the defendant has engaged in tangible conduct, such as hiring and firing. Thus, under the City HRL, the continuing violation doctrine can operate to link untimely allegations of unequal treatment to timely allegations of unequal treatment, such as plaintiff's termination."

Finally, have have further proof that the State and City HRL's should be interpreted identically. The City HRL, and its liberal proof requirements, has been on the books for several decades. When the State Legislature amended the State HRL in 2019, it was unclear if that law aligned with the City law. It does. Courts are now saying as such, and the First Department explicitly says so in this ruling, perhaps for the first time, though it cites Syeed v. Bloomberg LP, 41 N.Y.3d 446 (2024), a State Court of Appeals case, for that principle.