Jury Enters Sexual Harassment Verdict in Favor of Plaintiff; Awards No Damages

A jury in the Northern District of Georgia recently entered a verdict in favor of the plaintiff in a sexual harassment case, yet awarded her no damages.

In Furcron v. Mail Centers Plus, LLC, a former mailroom clerk, Myra Furcron, sued her former employer, Mail Centers Plus, LLC, for sexual harassment as a result of an alleged hostile work environment created by an autistic coworker.

Mail Centers Plus provides onsite mailroom and copying services for various mid-sized and large corporations. After receiving multiple complaints about an autistic employee (including sexually inappropriate and threatening conduct), the company transferred him to the facility where Furcron happened to be working.

Shortly after the transfer, Furcron complained to her supervisor that her autistic coworker frequently invaded her personal space, brushed up against her, and stared at her with an erection. Furcron’s supervisor responded that Furcron’s coworker meant no harm and that his conduct should be tolerated because of his disability. Furcron subsequently took a picture of her coworker’s erection in an effort to make management take her complaints more seriously. The managers apparently laughed at the picture and said that Furcron’s coworker always looked like that.

The company terminated Furcron a few days after she complained to management. Furcron claimed retaliation. The company claimed that she was terminated for violating company policy by taking a sexually suggestive photograph of a coworker without his permission and showing it to other employees, despite the company’s instructions that she keep the photograph and the employment matter confidential.

The trial court initially entered summary judgment in favor of Mail Centers on Furcron’s sexual harassment and retaliation claims, and Furcron appealed. On appeal, the Eleventh Circuit affirmed the grant of summary judgment in favor of Mail Centers on the retaliation claim, but it found that there was a question of fact with regard to whether the alleged harassment was severe and pervasive enough to support her sexual harassment claim. The sexual harassment claim was remanded and proceeded to trial.

At the conclusion of the trial, the jury entered a verdict in favor of Furcron on her sexual harassment claim. It found that: (1) Furcron had been harassed because of her gender; (2) the harassment created a hostile work environment for Furcron; (3) Furcron’s supervisor knew or should have known of the hostile work environment; (4) the supervisor did not take prompt remedial action to correct it; and (5) Furcron suffered damages as a result of the hostile work environment. Despite finding that she suffered damages as a result of a hostile work environment, the jury found Furcron should not be awarded any damages to compensate for emotional pain and mental suffering caused by the hostile work environment. In short, Furcron won her case, but took home nothing.

Furcron illustrates the uncertainty at trial, particularly with regard to the jury’s views toward key witnesses. While she was able to successfully establish the elements of her sexual harassment claim, the jury’s lack of sympathy for Furcron (who flaunted inappropriate pictures of her autistic coworker), and possible empathy toward her autistic coworker, arguably played a large part in its decision.

Reward for Highest Score: No Promotion, But $1.2 Million Jury Verdict

A long-time New Jersey police department employee applies for a promotion to captain. On the promotional exam, he scores higher than any other applicant. He isn’t promoted. His consolation prize, however, is a jury verdict of more than $1.2 million in state court last month.

In Downing v. Borough of Roselle and Chief Gerald Orlando, Bradley Downing, a former police officer, sued his former employer and supervisor for, among other things,  race discrimination and failure to promote. Downing, who is black, earned the highest score on the promotional exam to become a Captain in the police force. However, shortly before and after the exam scores were announced, Downing’s supervisor, who is white, disciplined Downing for allegedly minor offenses and then failed to recommend Downing for promotion.

Downing sued and the case eventually went to trial. Following a jury trial, Downing was awarded a total of $1,278,240, including $250,000 in punitive damages.

In motions filed after the trial, the defendants claimed that several of the trial court’s evidentiary rulings and actions prejudiced their case, including: (1) the court’s apparent refusal to allow evidence of the racial composition of the Borough Council, the entity that decided who would receive the promotion to Captain; and (2) the court’s questioning of a witness in front of the jury about a racially charged flyer pertaining to another candidate for the Captain position, whom Downing’s supervisor had recommended for promotion. The defendants argued that the flyer was hearsay evidence, extremely prejudicial, and should not have been admitted at trial. Whether the defendants’ post-trial motions and/or appeals are successful remains to be seen.

The Downing case illustrates the uncertainty inherent in a trial. While parties can file motions in limine, and raise objections at trial, there is no guarantee what evidence will come in and what evidence will be kept out. Surely the defendants in this case did not anticipate being barred from presenting evidence they considered critical to their case, or that the court would question a witness about a damaging, allegedly hearsay document.

 

 

 

Well-Documented Investigation and Carefully Written Policies Give Win to School District Against Discrimination, Retaliation Claims

 

Following nearly 10 days of witness testimony, a jury in Denton, Texas, has ruled in favor of the Denton Independent School District (ISD), and rejected an ISD para-professional’s claim that he was fired in retaliation for complaining about discrimination. Although the ISD’s termination letter to the para-professional stated that his history of filing meritless discrimination complaints constituted grounds for termination, the jury determined that it was the para-professional’s well-documented troubling and insubordinate conduct on October 31, 2014, that lead to his suspension and termination. Kenneth Lyons v. Denton Independent Sch. Dist., No. 15-05355-158 (158th Judicial Dist. Court, Denton County, TX).

In 2013, Kenneth Lyons, a former all-star basketball player at the University of North Texas, accepted a para-professional position with the ISD. In this role, Lyons mentored students who were struggling academically or had behavioral issues. On October 31, 2014, Lyons was working at one of the high schools in the district when he approached the school principal with a complaint about the school’s secretary, but the principal said he would discuss the matter with Lyons later. Both men claimed the other became upset and abusive during this conversation. Later that day, the principal – accompanied by an assistant principal – went to Lyons’ office to find out what was going on. Lyons insisted on discussing the matter privately and refused to speak with the pair. The principal returned later that day, but Lyons would not unlock his office door. An audio recording of that exchange included the principal threatening to call the police and ultimately telling Lyons to leave the building immediately.

Lyons was suspended and ISD investigated the incident. On March 11, 2015, ISD concluded that Lyons behaved inappropriately on October 31, 2014, and that his October 2014 complaint of discrimination, as well as several similar complaints he had filed, lacked merit and had been made in bad faith. ISD then terminated Lyons employment because of the October 31, 2014, incident, as well as his numerous, baseless allegations of discrimination. ISD noted its employment policies prohibit the filing of baseless complaints.

Lyons sued ISD in 2015 for discrimination and retaliation. After two mistrials, and nearly 10 days of witness testimony, in early-2018 a Texas jury ruled in favor of ISD. Among other things, the jury found that Lyons’ conduct on October 31, 2014, was the true cause of his termination. It also found that the ISD did not retaliate against Lyons in violation of public policy when it factored Lyons’ discrimination complaints into its assessments.

This case offers a variety of lessons. First, trials often take on a life of their own. This relatively straightforward case is a strong reminder that every trial requires a significant investment of time and energy, and the outcome is rarely a sure thing. Second, employers must take all complaints about discrimination seriously, investigate them appropriately, and carefully document the investigation and findings. The ISD’s ability to substantiate its investigations, combined with its existing policies, were sufficient to sway the jury in ISD’s favor.

Ignorance of Interplay between FMLA and ADA Can Be Costly To Employers

One mistake often made by employers is assuming that after an employee has exhausted his or her 12 weeks of protected Family Medical Leave Act (FMLA) leave, the employer’s obligation is fulfilled. While this may satisfy the employer’s medical leave obligations, the employer also must account for any potential duties under the Americans with Disabilities Act (ADA). The ADA requires employers to “reasonably accommodate” employees with disabilities and such accommodation can include granting additional leave.

A California case highlights this point. A California jury, finding that her former employer had violated the ADA, awarded a former drug addiction counselor more than $4.5 million in damages. Hill v. Asian American Drug Abuse Program, Inc., No. BC582516 (Cal. Sup. Ct. Jan. 19, 2018). Della Hill, while out on protected medical leave after breaking her arm, was diagnosed with major depressive disorder. Her medical leave was set to expire on March 23, 2015, but prior to its expiration, she submitted additional medical information to her employer on her diagnosis and requested additional leave. Instead of granting the request, her employer, the Asian American Drug Abuse Program (AADAP), terminated her on March 31, 2015, for failing to return from medical leave.

After determining that AADAP had failed to reasonably accommodate her disability, the jury awarded Hill $1.9 million in damages (approximately $550,000 in economic damages, and $1,350,000 in non-economic damages). The jury also determined that AADAP had acted with malice, oppression, and/or fraud, which allowed the jury to award another $2.6 million in punitive damages.

Hill’s attorney noted that AADAP did not provide “a single example of any effort … to accommodate Hill,” and claimed that AADAP had attempted to “cover up” its violation with pretextual reasons for Hill’s termination. Indeed, if the jury perceived AADAP’s proffered reasons as pretextual, it may have been key in determining AADAP had acted with “malice, oppression, and/or fraud,” triggering the additional punitive damages.

Key takeaways from this case include:

  • Don’t assume that adverse employment actions are permitted simply because an employee has not returned to work after exhausting FMLA leave. Consider whether additional leave is available under the ADA. If uncertain, consult with qualified employment attorney prior to taking action.
  • The broad definition of “disability” can include mental afflictions such as depression and anxiety. Further, an employee need not mention the ADA or ask for a “reasonable accommodation” to put the employer on notice of a possible need for accommodation.
  • Diligently document all interactions, especially on reasonable accommodation. Employers must be able to show that they engaged in a good faith interactive dialogue about potential accommodations.
  • Consider the situation objectively, and be aware of potential pretextual reasons for an adverse employment action. A jury may determine that pretext constitutes “malice, oppression, and/or fraud,” which opens up the possibility of punitive damages.

 

 

Wisconsin Jury Rejects Fired Jail Officer’s Claims of Discrimination and Retaliation

A case involving a former jail officer shows how keeping detailed, contemporaneous records of complaints of discrimination and unfair treatment can help defend against employee claims.

A federal jury in Wisconsin rejected a former jail officer’s claim that her termination was the result of sex discrimination and retaliation. The jury apparently found the plaintiff’s allegations of discrimination and retaliation, made only after her termination, lacked credibility and did not account for, or excuse, her failure to adequately perform her job.

In Waite v. Wood County, Wisconsin, 3:16-cv-00643 (W.D. Wis. 2018), Janis Waite alleged that, despite performing her work tasks in the same manner as her male colleagues, she received a negative performance review that stated she must show “some improvement to meet requirements” regarding job knowledge, dependability, and organizational ability. Waite further alleged that she had been singled out for unfair punishment when, unlike her male colleagues who engaged in the same behavior, she was suspended for personal use of a jail fax machine in one instance, and issued a written warning for using profanity over a jail speakerphone while a civilian was present in another instance. Finally, Waite claimed her employer’s reason for terminating her employment (disposal of a daily list of razors distributed to inmates before those razors were collected/returned) was mere pretext because she was not assigned to razor duties on that day.

Wood County disputed Waite’s contentions and presented evidence showing that:

  • Waite had been progressively disciplined because of ongoing performance issues;
  • Waite’s employment was terminated after repeated conduct violations and her refusal to fix her mistakes or modify her behavior; and
  • Waite never complained to human resources or her managers about alleged unfair or differential treatment until after she was fired.

Ultimately, the jury believed the County, rejected Waite’s claims, and rendered a verdict for the County.

Generally, a jury is less likely to find discrimination where an employee fails to raise complaints in a timely manner, when the employer was in a position to address those concerns. Furthermore, if the employee cannot show that she lodged complaints, or otherwise engaged in protected behavior, prior to termination, the chance of bringing a credible retaliation claim will be low. For these and many other reasons, human resources personnel, and managers in general, should keep detailed, contemporaneous records of any complaints of discrimination and unfair treatment.

OSHA Says Lawsuits Constitute Adverse Action Too

Not only is the Occupational Safety and Health Administration (OSHA) continuing to crack down on employers suspected of retaliating against employees who blow the whistle and will not hesitate to pursue litigation on behalf of employees, OSHA considers lawsuits against whistleblowers to constitute adverse action for purposes of finding unlawful retaliation.

In a case brought by OSHA on behalf of a whistleblower who reported improper asbestos removal practices at a school worksite and was fired for reporting these practices, the jury awarded the whistleblower approximately $174,000 ($103,000 in back wages, $20,000 in compensatory damages, and $50,000 in punitive damages).

The complaint alleged Champagne Demolition, LLC fired the whistleblower one day after he blew the whistle. The employee claimed he was subjected to verbal threats and legal action. In fact, a few weeks after Champagne Demolition fired the whistleblower, the company sued him for defamation. OSHA claimed that both the termination of the whistleblower’s employment and the filing of the defamation suit were retaliatory acts against the employee in violation of Section 11(c) of the Occupational Safety and Health Act.

A footnote in OSHA’s motion for summary judgment is telling of the Administration’s position on lawsuits against whistleblowers:

Lawsuits filed with the intent to punish or dissuade employees from exercising their statutory rights are a well-established form of adverse action. See BE & K Constr. Co. v. NLRB, 536 U.S. 516, 531 (2002) (Finding that a lawsuit that was both objectively baseless and subjectively motivated by an unlawful purpose could violate the National Labor Relations Act’s prohibition on retaliation); Torres v. Gristede’s Operating Corp., 628 F. Supp. 2d 447, 472 (S.D.N.Y. 2008) (“Courts have held that baseless claims or lawsuits designed to deter claimants from seeking legal redress constitute impermissibly adverse retaliatory actions.”); Spencer v. Int’l Shoppes, Inc., 902 F. Supp. 2d 287, 299 (E.D.N.Y. 2012) (Under Title VII, the filing of a lawsuit with a retaliatory motive constitutes adverse action).

While OSHA’s position initially may appear at odds with how courts typically define an adverse action, OSHA focused on the fact that there was no merit to the company’s defamation suit, because the whistleblower spoke the truth when he accused it of illegal asbestos removal. Generally, courts have concluded that frivolous employer revenge suits are retaliatory.

Employers should exercise caution in pursuing litigation against a whistleblower if there is any doubt as to the merit of the suit, especially when OSHA is involved. Please contact Jackson Lewis with any questions.

2018 New Year’s Resolutions For Lowering the Risk of Employment Litigation

When Jackson Lewis litigation attorneys looked back at cases, trials, and verdicts from the past year, we observed how companies can make themselves less of a target for claims.  Below are some New Year’s resolutions that can help lower the risk of employment litigation:

  • Train managers. Train employees. Keep a record of the training, including who attended. Review EEO laws and company policies. Use up-to-date and accurate materials you can show a government agency, plaintiff’s attorney, or jury.
  • Evaluate whether to contest unemployment benefits on a case-by-case basis. When an unemployment decision is appealed – by the company or former employee – have an attorney represent the company in the appeal. For many plaintiff’s attorneys, an appeal is an opportunity to cross-examine witnesses under oath and build a case on an unprepared, and unrepresented, company witness.
  • Engage in the interactive process. Do not automatically discharge an employee if he or she cannot return to work after FMLA leave expires. Do not automatically terminate the employee if he or she is unable to perform the essential functions of the job. Engage in a discussion with the employee. Document that discussion. Even if the result will be the same – discharge – the discussion and documentation may be all that is needed to avoid or win a claim.
  • Use offer letters. Set out prerequisites to employment such as background check, drug test, signing of non-compete, pre-employment physical, and so on. Do not guarantee terms of employment. Ensure the offer letter informs the employee that he or she is “at will.”
  • Have a handbook. Employees expect it. Government agencies ask for it. Ensure the handbook has appropriate legal updates. Confirm that it reflects company practices. Lay out the ground rules for your company and follow them.
  • Review all non-compete agreements used by your company for enforceability in the state in which they are being used.

These and other actions involve little or no cost, take little time to implement, and can help set a company’s agenda for 2018. These are lessons other companies learned the hard way over the past year (taught by plaintiff’s attorneys, government agencies, and industry competitors).

 

$1 Jury Verdict Yields $300,000 in Attorneys Fees to Plaintiff’s Counsel

In a case alleging sexual harassment by a researcher against a research assistant, the trial court ordered more than $300,000 in attorneys’ fees after the jury awarded a mere $1 in damages to the plaintiff. Jenkins v. The University of Minnesota et al., No. 13-CV-1548 (D. Minn. Oct. 13, 2017). The court awarded attorneys’ fees because it found that nonmonetary considerations significantly affected the case.

The plaintiff, Stephanie Jenkins alleged that the researcher, Ted Swem, sexually harassed her over the course of two 17-day field research trips in a remote area of Alaska, during the period between the research trips, and while working together at the University of Minnesota. She claimed that Swem photographed her buttocks when she was not looking, proposed they bring only one tent for the research trip, suggested she bathe in the river with him, and described what he imagined kissing her would be like.

As originally pled, the complaint contained nine counts against the University and various individual defendants. By the time of trial, only four causes of action remained: hostile work environment against the University, hostile work environment against Swem, intentional infliction of emotional distress against Swem, and assault against Swem. At the conclusion of trial, the court dismissed the assault claim and the jury rejected all but one claim. The jury found Swem liable for hostile work environment and awarded $1 in damages to the plaintiff. (The Special Verdict Form instructed the jury to write in $1 if they found the plaintiff’s damages had no monetary value.)

Against this backdrop, Swem argued that the plaintiff’s victory was merely “technical” and awarding attorneys’ fees would be unreasonable.

The court, summarizing case law, stated, “When a plaintiff recovers only nominal damages because of his failure to prove an essential element of his claim for monetary relief, the only reasonable fee is usually no fee at all.” However, the court noted that “[p]reventing sexual harassment to enable broad participation of all genders in the workforce is an important public goal.” It also noted that case law states, “Regardless of the form of relief he [or she] actually obtains, a successful civil rights plaintiff often secures important social benefits that are not reflected in nominal or relatively small damages awards.” Essentially, the court suggested that regardless of nominal damages, the plaintiff advanced a social goal in establishing Swem’s conduct was impermissible. Thus, attorneys’ fees were warranted, the court concluded, and awarded approximately $305,000 in attorneys’ fees to the plaintiff.

This case highlights the importance of attorneys’ fees when assessing risk in a case. Although the $1 damages verdict suggests the defendants had a relatively strong case, the court gave great weight to other nonmonetary considerations that significantly affected the overall result.

 

 

$6.8 Million Award for Theft of Company Trade Secrets

A dental technology company has obtained a $6.8 million judgment against a former employee accused of stealing the company’s designs. The federal district court in Central California entered the judgment after finding the defendant, Jian Lu, liable for stealing trade secrets. Sirona Dental Systems Inc., et al. v. Jian Lu, No. 2:15-cv-08777 (C.D. Cal. Oct. 19, 2017). This case highlights the importance of non-disclosure agreements, paying close attention to developments in your industry, as well as vigorously protecting your rights in court.

Sirona Dental Systems is one of the world’s largest manufacturers of dental technology, employing more than 3,300 people worldwide, and marketing its products in more than 135 countries. It develops, manufactures, and markets a complete line of dental products. One product in particular, the Apollo DI, combines highly confidential software and hardware to create an optical imaging equipment/system designed to provide dentists low-cost 3-D images of their patient’s teeth. At all times, Sirona treated the Apollo DI technology and designs as extremely confidential business secrets and proprietary information. Sirona took significant steps to protect the technology and information and keep them secret.

In 2011, Sirona acquired Arges Imaging, Inc., a company that focused on 3-D imaging technology. Defendant Jian Lu was Arges’ Senior Technical Director at the time. Lu had entered into a Non-Disclosure Agreement (NDA) with Arges’ in 2009. Lu became a senior engineer at Sirona beginning in approximately May 2011. While at Sirona, Lu worked on the Apollo DI technology and designs.

In 2013, Lu resigned from Sirona. In 2014, Sirona learned that two companies in China were placing orders with Sirona’s vendors for Apollo DI materials and were essentially creating a duplicate of the Apollo DI system and bringing it to market. When Sirona learned that these companies were owned by Lu, it filed suit for misappropriation of trade secrets and breach of the NDA agreement.

Although Lu and his companies answered Sirona’s complaint and initially participated in discovery, in July 2016, Lu’s attorneys withdrew from the case. Lu briefly represented himself, and then stopped participating in the case altogether. At that point, default judgment was entered against Lu’s companies and, in December 2016, the trial court granted summary against Lu. It held that Lu had stolen trade secrets. When Lu failed to participate in the subsequent damages proceedings, the court found Sirona was entitled to $6.66 million in damages for research and development that Lu allegedly saved by stealing information from Sirona, as well as $150,000 in penalties for intentional copyright infringement. Judgment was entered in October 2017.

While internal safeguards are important, when it comes to protecting trade secrets, companies also need to be vigilant and act quickly and decisively when it appears that a former employee is attempting to use the former employer’s secrets or copyrighted material to compete in the marketplace.

Iowa Waives Appeal of $2.2 million Verdict In Favor of Settlement

On August 24, 2017 we reported that former communications director for the Iowa Senate Republican Caucus, Kristen Anderson, was awarded $2.2 million in damages by a jury that found Anderson had been fired in retaliation for complaining about sexual harassment and a hostile work environment.

In late September, the parties reached a settlement, pursuant to which the State of Iowa will forego any appeal of the jury verdict, and will pay approximately $1,045,000 to Anderson, and approximately $705,000 for Anderson’s legal costs and fees.  On October 1, 2017, Iowa’s State Appeal Board approved this settlement.

 

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