2d Circuit outlines when employees can win under the WARN Act

You do not see many cases brought under the WARN Act, shorthand for the Worker Adjustment and Retraining Notification Act, enacted in the late 1980s, which requires certain employers to notify employees within 60 days of a "plant closing" or that there will be a mass layoff. This case holds that a factfinder may may determine that a restaurant at the Resorts World Casino had to notify employees that it was shutting down because it was sufficiently distinct from the Casino and therefore fell within the WARN Act.

The case is Roberts v. Genting New York LLC, issued on May 15. If an entity is an operating unit within a single site of employment, it must comply with the WARN Act, which provides for damages when the Act is not followed. This is a putative class action, so if the plaintiffs win the case, they will recover mucho damages. Is the restaurant a "single site of employment"? If so, the case goes to trial. This is not an easy call. Under the regulations, an entity is an "operating unit" and subject to the WARN Act if it is "an organizationally or operationally distinct product, operation, or specific work function within or across facilities at the single site." 

What complicates the case is the restaurant is located inside the Casino, so defendant argues that the restaurant is not subject to the WARN Act because it was integrated with the Casino and was not a distinct operating unit. The Court of Appeals (Chin, Newman, and Sullivan in dissent) finds that while the Casino provided the restaurant with centralized services, such as purchasing, warehousing, HR management, and cleaning, other factors suggest the restaurant was an independent operating unit under the Act, in particular, (1) its physical location was in an area separate from other retain outlets and amenities and did not share space with any other restaurant, (2) the restaurant's kitchen prepared all of the hot items it served, operated on an all-you-can-eat basis, and had unique food items, (3) its managers worked there full-time, (4) its employees typically worked there for at least six months and their wages were allocated to the restaurant's cost center, (5) defendant did not treat restaurant personnel as interchangeable with their counterparts at other food outlets, and (6) the servers wore different clothing than their counterparts at the Casino's other eateries. 

All this needs to be resolved by the factfinder. The plaintiffs can still lose the case, as there are factors that militate against the restaurant being a separate entity from the Casino under the WARN Act. In a footnote, the Court says it is an open question of law whether a jury or the trial court is the factfinder in these cases. The majority view is that the trial court makes these determinations because remedies under the Act are equitable rather than legal in nature.

Split decision in nuanced fabricated evidence claim yields win for plaintiff

Did you know you can sue the police for manufacturing evidence against you? These are called fabricated evidence claims. In this case, a divided Court of Appeals holds that the plaintiff can sue the police for fabricating his alleged drug sale even though plaintiff was found guilty of possession. This is a very nuanced holding.

The case is Barnes v. City of New York, issued on May 22. The district court said plaintiff could not maintain a fabricated evidence claim because there was no deprivation of liberty. The liberty deprivation must be proven in order to bring these claims under the Due Process Claim. The district court's reasoning was that plaintiff served no additional time in custody because of the possession conviction, even if he was acquitted of selling drugs. The Court of Appeals disagrees.

Judge Lee reasons that "to insist that a deprivation of liberty requires custody or a conviction overlooks the fact that Barnes' prosecution on the drug sale charge is itself a deprivation of liberty," and the Court has previously held that a plaintiff's "prosecution can be a deprivation of liberty." Liberty may be deprived by consequences beyond custody, the Court writes, as "being framed and falsely charged damages an individual's reputation, requires that individual to mount a defense, and places him in the power of a court of law." It is one thing to be arrested for drug possession. It is another thing to be falsely charged with being a drug dealer, the Court holds, and the two different arrests from the same event caused plaintiff therefore to "suffer[] different deprivations of liberty as a result."

In dissent, Judge Sullivan writes that, because Plaintiff "would have been held in the same place for the same amount of time," even without the fabricated evidence charge, his claim must fail since he alleges no "additional" liberty deprivation traceable to the fabricated evidence. The majority responds that this is not the law of the Second Circuit, which held in Smalls v. Collins, 10 F.4th 117 (2d Cir. 2021) (a case that I argued), that "we have long held that Section 1983 liability attaches for knowingly falsifying evidence even where there simultaneously exists a lawful basis for the deprivation of liberty that the plaintiff suffered."

How to plead a retaliation case under Title VII and ADEA

Plaintiff in this case tried to amend her lawsuit to assert a retaliation claim against a school district. The district court denied the amended complaint on the basis that it did not assert a plausible cause of action. The Court of Appeals reverses.

The case is Curry-Malcolm v. Rochester City School District, a summary order issued on May 30. Plaintiff proceeds under Title VII and the Age Discrimination in Employment Act. The question is whether her complaint sufficiently asserts she suffered an adverse action. In plain English, did anything happen to plaintiff that makes this situation worth suing over> Here is the Second Circuit's concise summary of the state of the law in the area of pleading retaliation claims:

An employment action is adverse in the retaliation context if a plaintiff “show[s] that a reasonable  employee would have found the challenged action materially adverse, which in  this context means it well might have dissuaded a reasonable worker from making or supporting a charge of discrimination.” Davis-Garett v. Urban Outfitters, Inc., 921 F.3d 30, 43 (2d Cir. 2019) (quoting Burlington N. & Santa Fe Ry. Co. v. White, 548 U.S. 53, 68 (2006)) (emphasis in original). For example, “a poor performance evaluation could very well deter a reasonable worker from complaining.” Vega v. Hempstead Union Free Sch. Dist., 801 F.3d 72, 92 (2d Cir. 2015). At the motion to dismiss stage, “[c]ausation may be shown by direct  evidence of retaliatory animus or inferred through temporal proximity to the protected activity.” Duplan v. City of New York, 888 F.3d 612, 625 (2d Cir. 2018).

The Second Circuit (Walker, Leval and Lohier) holds that the pro se Plaintiff asserts an adverse action under the retaliation cases because within  one to three months after she made internal and external complaints of discrimination, the school district secretly changed her name and social security number in their tax records, demoted her to special education teacher, promoted a less qualified coworker over her, and transferred her to another school with a higher workload. Then, one of her informal internal discrimination complaints was dismissed internally without the district providing her notice or an opportunity to be heard, and plaintiff was ultimately laid-off from her position. Then, after she filed complaints with SDHR and EEOC, the district removed her name from number 11 to number 30 on the preferred eligibility list for recall.

For Federal Rules junkies only

This is a case that only a federal litigator will love, including trial and appellate lawyers. The Supreme Court is telling us when a party that files an unsuccessful motion for summary judgment can take up those issues on appeal after losing at trial even if they fail to preserve their objection to that issue during trial. The bottom line is that purely legal issues may be raised on appeal even if the party did not assert an objection at trial.  

The case is Dupree v. Younger, issued on May 25. The decision is unanimous, which is often the case when the Supreme Court interprets the Federal Rules of Civil Procedure. 

Here is how things work in practice. You are defending a lawsuit and file a summary judgment motion, arguing that the plaintiff does not have enough evidence to win at trial. The district court denies the motion, the case goes to trial, defendant loses and then takes up an appeal, challenging the verdict on the basis that plaintiff did not have enough evidence to win the trial. Defendant cannot do that. The real appeal from the verdict will be from the trial court's ruling under Rule 50(a), as that motion for judgment as a matter of law will be based on the evidence at trial, not the summary judgment record, which by the time the case reaches trial everyone has forgotten about. So a defendant has to make that evidence-sufficiency motion at trial under Rule 50(a) and then renew that motion post-trial under Rule 50(b) if the trial judge denied the motion for JMOL at trial. 

The exception to that above rule has now been endorsed by the Supreme Court. Here is what happened. Plaintiff is an inmate who claims the correction officer assaulted him. Dupree moved for summary judgment prior to trial, claiming that plaintiff did not comply with the grievance requirements under the Prison Litigation Reform Act, which requires inmates to file an internal complaint before he proceeds in court. At trial, the jury found for the plaintiff and awarded him $700,000 in damages, which could very well make him the wealthiest man in the building. At trial, defendant did not raise the administrative exhaustion defense. But he raises that issue on appeal, claiming the trial court should have granted him summary judgment on that issue.

Plaintiff opposed that appeal, citing case law in some circuits that you cannot raise any issue on appeal that was denied on the summary judgment that you did not renew at trial. The Supreme Court agrees with the defendant correction officer and says the Fourth Circuit may in fact find that defendant did not have to renew that objection under Rule 50(a) at trial since it is possible that nothing would have happened at trial that would have further developed the record and it therefore may have been a purely legal issue.   

What it means for this case in particular is that the Fourth Circuit has consider this issue on remand. The Court of Appeals has to consider if defendant's PLRA objection is "purely legal." If it finds the issue was purely legal, and the Court of Appeals finds that plaintiff did not file the proper grievance under the PLRA, then plaintiff's verdict will disappear. 

Excessive force and false arrest verdict is upheld on appeal, but no punitive damages

The Court of Appeals has sustained a police misconduct verdict in which the plaintiff claimed a Syracuse police officer subjected him to excessive force, false arrest, and malicious prosecution. But the Court also held that plaintiff is not entitled to punitive damages for these civil rights violations.

The case is Franco v. Gunsalus, a summary order issued on May 23. I briefed and argued the appeal. Fred Lichtmacher, Esq., tried the case. The case began when Franco showed up to a party in Syracuse just as the crowd was dispersing. The officer claimed that he gave a loud order to disperse and that Franco ignored him, but Franco and his witnesses testified that no such order was given and the officer instead out of frustration over Franco's bad attitude beat him up on the street, even after Franco hit the ground. He was arrested for disorderly conduct, harassment, and resisting arrest, and the charges were ultimately dismissed. The jury found in his favor under Section 1983.

The Court of Appeals affirms the verdict as supported by the weight of the evidence. It opens this discussion by stating, "We have held that a police officer violates a clearly established Fourth Amendment right when he 'use[s] significant force against an arrestee who is no longer resisting and poses no threat to the safety of officers or others.' Moreover, it was well established in our circuit at the time of the altercation 'that the use of entirely gratuitous force is unreasonable and therefore excessive.'" To this end, the verdict is upheld only a few weeks after oral argument as the Court of Appeals (Calabresi, Menashi and Lee) do not find this case especially remarkable.

Plaintiff did ask the trial court to allow the jury to award punitive damages. The trial court said it would not do so and that it would vacate any punitive damages award were he to do so. Trial counsel expressly placed his objection on the record. Franco appealed from that ruling, arguing that excessive force, false arrest, and malicious prosecution can be sufficiently wanton and malicious to support a punitive damages award. The Court of Appeals rejects that argument on the basis that trial counsel waived his objection to the trial court's ruling and that it was not to say "I object" on the record. I have not seen this analysis much over the years, but the Court of Appeals says that under Fed. R. Civ. P. 51, the trial lawyer has to say more than simply "I object" to the rejected jury charge. Under that rule,“A party who objects to ... the failure to give an instruction must do so on the record, stating distinctly the matter objected to and the grounds for the objection.” Without a specific reason to request punitive damages, the Court of Appeals says, counsel's objection was insufficient. In my experience, lawyers usually just say "I object" to a trial court's jury charge, but under this analysis, we have to amplify our objections.

Still, even with the waiver, plaintiff could win the appeal under the plain error doctrine. That poses a higher burden of proof for the plaintiff, who must show the trial court's ruling contravened established law. The Court of Appeals finds there was no plain error. Bear in mind that the trial court in its post-trial ruling under Rule 50(b) summarized the excessive force evidence in particular this way:

at trial, various witnesses testified that Plaintiff was on the side of the road, leaning into his friend's vehicle, when Defendant Gunsalus came up from behind him and began punching Plaintiff and dragging him to the ground. In these versions of the events, Plaintiff did not pose any immediate threat to Defendants or to passersby. As examples, there was no evidence that Plaintiff had a weapon, that he verbally threatened the officers, or that he was confronting others on the street.

That sequence of events would not automatically entitle Franco to a punitive damages charge, the Court of Appeals says, for this reason:

Neither an excessive use of force nor an unreasonable belief about probable cause necessarily entitles a Section 1983 plaintiff to punitive damages. We have long held that the availability of punitive damages requires more than what is required for liability under Section 1983. “To accept [the contrary] proposition would essentially expose a defendant to an award of punitive damages for any conduct not protected by qualified immunity, and would thereby make the availability of punitive damages equal to the availability of compensatory damages. That proposition is contrary to the principles [of our Section 1983 case law].” The district court concluded that Franco had failed to identify evidence of the officers’ subjective awareness of wrongdoing. On this record, we cannot say that its determination was plainly erroneous. At trial, various witnesses testified that Plaintiff was on the side of the road, leaning into his friend's vehicle, when Defendant Gunsalus came up from behind him and began punching Plaintiff and dragging him to the ground. In these versions of the events, Plaintiff did not pose any immediate threat to Defendants or to passersby. As examples, there was no evidence that Plaintiff had a weapon, that he verbally threatened the officers, or that he was confronting others on the street.

Franco v. Gunsalus, No. 516CV634FJSTWD, 2022 WL 93570, at *5 (N.D.N.Y. Jan. 10, 2022)

Wrongful death case (and expert opinion) is reinstated

This is a wrongful death case against Correctional Medical Care, Inc. An inmate died at the Schenectady County Correctional Facility. The trial court dismissed the case after crediting the defendants' medical expert and finding plaintiff's medical expert report to be inadmissible. The Court of Appeals reverses and the case returns to the district court.

The case is Richardson v. Correctional Medical Care, Inc., a summary order issued on May 17. When the trial court excludes evidence at the pre-trial stage, the standard of review is "abuse of discretion" which is as deferential to the trial court as you can get. These appeals are tough to win, but they can be won. Plaintiff wins this appeal.

First, the trial court rejected the plaintiff's expert opinion because it was submitted in the form of an unsworn letter. Such documents are generally inadmissible under Second Circuit precedent. But in this case, the doctor reaffirmed his opinion in deposition, emphasizing that the inmate's medical history and symptomology in the days leading up to his death made it imperative that someone check the functionality of cardioverter-defilibrator. This sworn deposition cures the unsworn expert letter. As a further footnote to this holding, the deposition was unexecuted, which means the doctor did not sign it. But the court reporter, who is a notary public, did certify that the transcript is authentic. That's enough to make the the doctor's opinion admissible.

Second, while the district court held the doctor's expert opinion was not reliable under Fed. R. Evid. 702 and Daubert v. Merrill Dow Pharmaceuticals, Inc., 509 U.S. 579 (1993), the district court improperly resolved disputed issues of fact in reaching this holding. The district court did not identify any basis for concluding that plaintiff's doctor's opinion was not based on sufficient facts or data or was not the product of reliable principles and methods that were reliably applied to the facts of this case. In the end, the Court of Appeals (Raggi, Livingston, and Carney) states, neither expert offered a definitive opinion that conclusively established the case of the inmate's death. In excluding the plaintiff's expert opinion, the trial court "deprived Ms. Richardson the opportunity to present her case to the jury tasked with assessing the credibility of the parties' competing experts and determining the weight that should be afforded to their opinions."

 

Local gadfly can't sue school district over speech violations

Every community has a gadfly who writes letters to the editor and to public officials. They may be difficult and even annoying but they do represent the First Amendment in action. In North Korea, this activity might land you in jail. In America, this activity might land you in court. That's what happened here, except the Court of Appeals says plaintiff has no viable First Amendment claim.

The case is Searle v. Red Creek Central School District, a summary order issued on May 12. From August 2019 through January 2020, plaintiff repeatedly emailed faculty and administrators, questioning their competence and professionalism. In response, the district told plaintiff that for the rest of the school year, he should direct any communications to the superintendent or get permission before entering school grounds. Plaintiff then wrote an editorial for the local paper referencing that directive and calling for the superintendent's removal. This case was dismissed under Rule 12, before the parties could take any discovery. The Court of Appeals(Livingston, Raggi and Nardini) affirms.

The case was properly dismissed because, while the district told plaintiff he needed permission before he entered school property, that is not enough for a First Amendment lawsuit in the context of this case. To win the case, plaintiff has to show the directive chilled his speech or caused him some other harm. The complaint does not allege that plaintiff changed his behavior in any way in response to the directive. Note that he published an editorial against the school district shortly after the district issued the directive. Nor does he allege any other harm flowing from the directive. Key cases on chilling and other First Amendment harms in this context are Curley v. Village of Suffern, 268 F.3d 65 (2d Cir. 2001), and Zerkha v. Amicone, 634 F.3d 642 (2d Cir. 2011).