Justia Labor & Employment Law Opinion Summaries

Ryan West, a former employee of Village Practice Management Company, LLC ("Village"), sought a declaratory judgment from the Court of Chancery of Delaware. West argued that Village could not declare a forfeiture of his vested Class B Units after he joined a competitor post-employment, as the Agreement did not limit post-employment competitive activities. Village contended that West forfeited his vested Class B Units by joining a competitor, invoking the Management Incentive Plan's ("Plan") forfeiture provisions.The Court of Chancery denied Village's motion to stay proceedings and compel West to submit his claims to Village's Compensation Committee. The court then granted West's motion for judgment on the pleadings, holding that the Agreement only restricted "detrimental activity" during employment. Consequently, Village could not enforce a forfeiture of West's vested Class B Units for activities occurring after his resignation. The court also awarded West his attorneys' fees.On appeal, the Supreme Court of Delaware reversed the Court of Chancery's decision. The Supreme Court found that the term "Participant" in the Agreement could reasonably be interpreted to include former employees, making the Agreement ambiguous. Therefore, the grant of judgment on the pleadings in favor of West was improper. The Supreme Court also reversed the award of attorneys' fees to West, as he was no longer the prevailing party. However, the Supreme Court upheld the Court of Chancery's denial of Village's request for a stay, distinguishing the case from others that required disputes to be resolved by a committee first. The case was remanded for further proceedings consistent with the Supreme Court's opinion. View "Village Practice Management Company, LLC v. West" on Justia Law

Susan Miele was hired by Foundation Medicine, Inc. (FMI) in 2017 and signed a restrictive covenant agreement that included a nonsolicitation provision. In 2020, Miele and FMI executed a transition agreement upon her separation, which incorporated the restrictive covenant agreement and included a forfeiture clause. FMI paid Miele approximately $1.2 million in transition benefits. After joining Ginkgo Bioworks in 2021, Miele allegedly solicited FMI employees to join Ginkgo, leading FMI to cease further payments and demand repayment of benefits.Miele sued FMI in late 2021 for breach of the transition agreement, and FMI counterclaimed for breach of contract. Miele moved for judgment on the pleadings, arguing that the provisions FMI relied on were unenforceable under the Massachusetts Noncompetition Agreement Act. A Superior Court judge granted Miele's motion in part, ruling that FMI could not enforce the forfeiture provision but allowed FMI to assert Miele's breach as a defense and seek damages. The judge concluded that the transition agreement qualified as a "forfeiture for competition agreement" under the act.The Supreme Judicial Court of Massachusetts reviewed the case. The court held that the Massachusetts Noncompetition Agreement Act does not apply to a nonsolicitation agreement, even if it includes a forfeiture provision. The court reasoned that the act explicitly excludes nonsolicitation agreements from its scope, and a forfeiture clause does not change this exclusion. The court reversed the Superior Court's order partially granting Miele's motion for judgment on the pleadings and remanded the matter for further proceedings consistent with its opinion. View "Miele v. Foundation Medicine, Inc." on Justia Law

Jesus Yanez was hired by EchoStar Communications Corporation in 2001 and signed an arbitration agreement as part of his employment. Over the years, EchoStar underwent several corporate changes, including a name change to DISH Network Corporation and the creation of a new company, EchoStar Corporation. Yanez was terminated in 2018 and subsequently filed discrimination claims. After receiving right to sue letters, he sued in Texas state court, alleging age and nationality discrimination. The case was removed to federal court, where the district court granted a motion to compel arbitration and transferred the case. The arbitration proceeded slowly, and the district court eventually dismissed the case without prejudice due to the parties' failure to file a status report.The United States District Court for the Western District of Texas granted the motion to compel arbitration and stayed the case pending arbitration. The case was transferred to the Western District of Texas, El Paso division. The district court issued multiple show cause notices due to slow arbitration proceedings and ultimately dismissed the case without prejudice when the parties failed to file a required status report. Yanez filed a motion to alter or amend the judgment, which was denied by the district court, citing a recent Supreme Court decision.The United States Court of Appeals for the Fifth Circuit reviewed the case. The court affirmed the district court's decision to compel arbitration, finding that the arbitration agreement was valid and enforceable under Texas law. However, the court reversed the district court's dismissal of the case, holding that the dismissal was effectively with prejudice due to the statute of limitations and did not meet the heightened standard required for dismissals with prejudice. The case was remanded for further proceedings consistent with the ruling. View "Yanez v. Dish Network" on Justia Law

Efrain Oliveras-Villafañe, Mirta Rosario-Montalvo, and their conjugal partnership (collectively, "Appellants") filed a lawsuit against Baxter Healthcare SA and related entities ("Appellees"), alleging unlawful discrimination. Oliveras worked for Baxter from 1990 until 2019, holding various positions, including Engineering Director. In 2018, he was transferred to a lower position, which he claimed was part of a discriminatory effort to remove senior Puerto Rican personnel. In 2019, his position was eliminated, and he chose termination over accepting two part-time roles. He filed a discrimination charge with the EEOC in May 2019.The United States District Court for the District of Puerto Rico granted summary judgment in favor of the Appellees. The court found that the Appellants failed to comply with Local Rule 56(c) and disregarded non-compliant facts. It dismissed the Title VII claims, ruling that the EEOC charge did not encompass the February 2018 transfer and was untimely. The court also found that the Appellants did not establish a prima facie case of discrimination regarding the March 2019 termination. The remaining claims were dismissed based on the Appellants' concessions.The United States Court of Appeals for the First Circuit affirmed the district court's judgment. The appellate court noted that the Appellants failed to challenge the district court's finding that the EEOC charge did not encompass the February 2018 transfer, leaving an independent ground for affirmance. The court emphasized that arguments must be clearly articulated and supported, and the Appellants' failure to address the exhaustion issue was fatal to their appeal. Thus, the district court's decision was upheld. View "Oliveras-Villafane v. Baxter Healthcare SA" on Justia Law

Three former or current employees of Cross Country Staffing, Inc. (plaintiffs) filed a lawsuit against their employer, alleging various labor law violations. Upon hiring, each plaintiff signed two agreements: an Arbitration Agreement mandating arbitration for all employment-related claims and an Employment Agreement that included provisions favoring the employer, such as non-compete clauses and the right to seek injunctive relief in court without posting a bond.The Superior Court of Los Angeles County denied Cross Country Staffing's motion to compel arbitration, finding that the Arbitration Agreement, when read together with the Employment Agreement, was unconscionable. The court determined that the agreements were procedurally unconscionable due to their adhesive nature and substantively unconscionable because they unfairly favored the employer by allowing it to litigate its likely claims in court while forcing employees to arbitrate their likely claims. The court also noted the non-mutual attorney fees provisions and the employee's mandated concessions regarding injunctive relief.The California Court of Appeal, Second Appellate District, Division Five, affirmed the trial court's decision. The appellate court agreed that the two agreements should be read together under Civil Code section 1642, as they were part of the same transaction and related to the same subject matter. The court found significant substantive unconscionability in the agreements' imbalance of arbitration obligations and the employer's access to court for its claims. The court also upheld the trial court's refusal to sever the unconscionable provisions, concluding that the agreements' unconscionability permeated the entire arbitration framework and that refusing to enforce the Arbitration Agreement served the interests of justice. View "Silva v. Cross Country Healthcare, Inc." on Justia Law

Troy Grove and Vermilion Quarry, divisions of RiverStone Group, Inc., were found by the National Labor Relations Board (NLRB) to have violated the National Labor Relations Act (NLRA). The case involved seven employees at the two quarries, represented by the International Union of Operating Engineers, Local 150, AFL-CIO. The company was accused of unfair labor practices in bargaining over a pension fund and in its treatment of two employees.The NLRB ruled that the company had not bargained in good faith, declaring that the parties were not at an impasse and that the company had threatened to cease contributions to the pension fund. The company and the union both petitioned for judicial review, and the NLRB sought enforcement of its order. The company argued that the parties were indeed at an impasse after five years of negotiations and a three-year strike, and that the union's last-minute information request did not change this.The United States Court of Appeals for the District of Columbia Circuit reviewed the case. The court found that the NLRB's decision was not supported by substantial evidence and that the parties were at an impasse. The court noted that the union's denial of an impasse and its information request were insufficient to rebut the clear evidence of a deadlock. Consequently, the court vacated the NLRB's order regarding the pension fund issue.Regarding the treatment of the two employees, the NLRB had found that the company violated Section 8(a)(1) of the NLRA by issuing layoff notices shortly after the employees participated in union activities. The court upheld this part of the NLRB's decision, finding that the timing and circumstances of the layoff notices could reasonably be seen as coercive.The court granted the company's petition for review on the pension fund issue, vacated the relevant parts of the NLRB's order, denied the union's petition for review, and granted the NLRB's cross-application for enforcement in all other respects. View "Troy Grove v. NLRB" on Justia Law

Rita Oteka, a faculty member at The University of Texas Rio Grande Valley, attended a commencement ceremony voluntarily. While walking to her car after the event, she was struck and injured by a vehicle driven by a University police officer. The University, a self-insured employer for workers' compensation, reported the injury to its third-party claims administrator. The administrator denied benefits, stating that Oteka was using her personal insurance, no medical evidence was presented, and the injury was not work-related. Oteka did not contest this denial or file a compensation claim.Oteka later sued the police officer for negligence, and the University substituted in as the defendant. The University claimed that workers' compensation benefits were the exclusive remedy for Oteka's injury, asserting for the first time that the injury was work-related. The district court denied the University's plea to the jurisdiction, and the University appealed. The Court of Appeals for the Thirteenth District of Texas affirmed, holding that the Division of Workers' Compensation did not have exclusive jurisdiction over the course-and-scope issue in this context.The Supreme Court of Texas reviewed the case and held that the Division does not have exclusive jurisdiction to determine whether an injury was work-related when the issue is raised by an employer's exclusive-remedy defense and the employee's lawsuit does not depend on entitlement to workers' compensation benefits. The court affirmed the lower court's judgment, emphasizing that the Workers' Compensation Act does not provide a procedural mechanism for obtaining a course-and-scope finding from the Division without the employee first filing a compensation claim. View "THE UNIVERSITY OF TEXAS RIO GRANDE VALLEY v. OTEKA" on Justia Law

Olayinka Oye, a director at PricewaterhouseCoopers, applied for long-term disability benefits through her employer's plan, administered by Hartford Life and Accident Insurance Company, due to fibromyalgia. Initially, Hartford denied her claim but later reversed its decision and awarded her benefits. In 2020, Hartford reevaluated her condition and terminated her benefits, concluding she was no longer disabled. Oye filed a lawsuit seeking to reinstate her benefits under the Employee Retirement Income Security Act (ERISA).The United States District Court for the Northern District of Illinois conducted a "paper trial" and found that Oye's fibromyalgia, while limiting, did not render her disabled under the plan. The court noted that consultative reports from Hartford's doctors, which were detailed and tied to Oye's medical records, outweighed the brief and conclusory letters from Oye's treating physicians. Additionally, the court found that Oye's mental health issues contributed significantly to her limitations, disqualifying her from additional benefits under the plan.The United States Court of Appeals for the Seventh Circuit reviewed the case. The court affirmed the district court's decision, emphasizing that the district court owed no deference to Hartford's prior determination of disability. The appellate court found no clear error in the district court's findings, noting that the district court carefully considered the evidence and provided adequate reasoning for its decision. The court also addressed Oye's contention that the district court should have discussed a 2017 consultative report, concluding that the district court was not obligated to address every piece of evidence and had reasonably focused on more recent reports. The Seventh Circuit affirmed the district court's judgment in favor of Hartford. View "Oye v Hartford Life and Accident Insurance Company" on Justia Law

James Hess filed an employment discrimination lawsuit against Union Pacific Railroad Company, claiming he was unlawfully terminated due to his disability. Union Pacific has a "Fitness-for-Duty" policy requiring employees to disclose certain health conditions. Hess, who began working for Union Pacific in May 2013, was prescribed Xanax for post-traumatic stress disorder in 2015. In 2016, Union Pacific prohibited medications like Xanax, and in January 2017, Hess was removed from service and later disqualified from his job following a fitness-for-duty evaluation.The District Court for the District of Nebraska dismissed Hess's action as untimely, agreeing with Union Pacific that the statute of limitations was not tolled while the Harris class action was pending because Hess was not a member of the certified class. The Harris class action, filed in 2016, alleged that Union Pacific's fitness-for-duty policy discriminated against employees with disabilities. The class was initially defined broadly but was later certified under a narrower definition, excluding Hess. The class was decertified by the Eighth Circuit in March 2020, after which Hess filed an EEOC charge and received a right-to-sue letter.The United States Court of Appeals for the Eighth Circuit reviewed the case. Citing its recent decision in DeGeer v. Union Pacific Railroad Co., the court held that Hess was entitled to American Pipe tolling because he was not unambiguously excluded from the certified class. Therefore, the statute of limitations was tolled until the class was decertified. The Eighth Circuit reversed the district court's dismissal and remanded the case for further proceedings, concluding that Hess's lawsuit was timely filed. View "Hess v. Union Pacific Railroad Co." on Justia Law

Robert L. Palmer, a long-time employee of Union Pacific, alleged that the company discriminated against him due to his disability, diabetes, which led to diabetic retinopathy. After undergoing surgery for his right eye in 2011, Palmer continued working until November 2013, when his left eye developed blurred vision. Union Pacific then initiated a fitness-for-duty evaluation, resulting in a February 2014 letter from Dr. Holland, the Chief Medical Officer, imposing permanent work restrictions on Palmer. Despite submitting medical information from his eye doctor in May 2014, which cleared him for work, Palmer received a December 2014 letter reaffirming the permanent restrictions and stating that no further medical information would be considered.Palmer was part of a putative class action (Harris class) filed in February 2016, which alleged that Union Pacific's fitness-for-duty policy discriminated against employees with disabilities. The class was certified in February 2019 but decertified in March 2020. Palmer then filed an individual charge of discrimination with the EEOC in April 2020 and subsequently filed this action under the ADA, claiming his suit was timely due to tolling during the class action.The United States District Court for the District of Nebraska dismissed Palmer's claims as time-barred, concluding that the only adverse employment action occurred in February 2014, outside the class definition period. Palmer's motion to reconsider or amend was denied, as the court found the December 2014 letter was not a separate adverse action but a consequence of the February 2014 action.The United States Court of Appeals for the Eighth Circuit reviewed the case and found that the district court relied on an outdated standard for adverse employment actions. Under the new standard from Muldrow v. City of St. Louis, Palmer's allegations that the December 2014 letter caused him harm by denying future review opportunities were sufficient to constitute an adverse employment action. The appellate court reversed the district court's denial of reconsideration and leave to amend, remanding for further proceedings. View "Palmer v. Union Pacific Railroad Co." on Justia Law