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Showing 18 posts from August 2013.

The Inbox, Panda-monium And Dreams Edition

Even in the pre-Labor Day lull, things still happen here at the Suits by Suits Global Operations Center in our Nation’s Capital.  This week, we welcomed a new panda cub at the National Zoo, and celebrated the 50th anniversary of the famous March on Washington for Civil Rights, which remembered Martin Luther King Jr.’s historic “I Have A Dream” speech. 

Things happened elsewhere in the broader world of disputes between executives, other employees and employers, too, including:

  • The news anchor is still mad-as-h-e-double-hockey-sticks, and he’s not going to take it anymore:  We’ve covered the public and somewhat bitter dispute between TV newsman Larry Connors and his former employer KMOV-TV in St. Louis; now, Connors has sued the station for defamation.
  • J. Edgar Hoover, please call your office: An FBI special agent alleges the bureau retaliated against him after he reported that two colleagues had “allegedly engaged in sexual misconduct in addition to a ‘clear pattern of fraud, waste and abuse over a period of years.’” 
  • And another involving the FBI: Media giant Thomson Reuters is stridently rejecting a former employee’s argument that he was fired after he leaked information about alleged insider trading violations to the FBI.  The company’s motion to dismiss the suit also says the former employee doesn’t qualify as a whistleblower under Dodd-Frank.  Interesting fact about our modern trading exchanges: the case involves the disclosure of some economic data Thomson Reuters compiles to certain customers two seconds before others get it. 
  • Maybe he tried to steal that nasty Mucinex guy: A cough syrup manufacturer lost its bid to reinstate claims for breach of contract and unfair competition against a former employee when a New Jersey appellate court affirmed the lower court’s dismissal of them.  The court ruled that the confidentiality provision in the manufacturer’s employment agreement was too broad to be enforceable under New York’s law, which applied to the dispute: “In sum, the confidentiality provision is unenforceable under New York law because it is overly restrictive in time and scope, does not further a legitimate business interest, is contrary to established public policy, and is unduly burdensome” to the employee.  No word on any other side effects.     
  • Smashing a printer with a baseball bat may no longer be the real problem departing employees pose: “Half of all departing employees retain confidential company files following their termination,” concludes a study by Symantec reported here.  
  • “No severance pay but still crazy rich”: That’s the headline on this CNNMoney article about retiring Microsoft executive Steve Ballmer, and it says it all.  The article explains that Microsoft doesn’t have retirement or severance for its executives, but Ballmer won’t be complaining too loudly: as the 22nd richest person in America, his Microsoft shares alone are worth over $11 billion.  

You’re “Not That Pretty,” Part 2 – You’re Old, Too

In the previous part, we looked at Elke Tober-Purze’s lawsuit against her employer, the City of Evanston.  The federal court hearing the case ruled in Tober-Purze’s favor on Evanston’s motion to dismiss her claim that it had discriminated against her by paying her male colleagues more and ultimately terminating her from her job as an assistant city attorney. 

In the same opinion, the court also denied Evanston’s motion to dismiss Tober-Purze’s claim for age discrimination based on federal law.  That law – the Age Discrimination in Employment Act – requires an aggrieved employee to demonstrate that he or she: 1) is over forty; 2) otherwise meets the employer’s expectations; 3) suffered an adverse employment action – such as being terminated or passed over for promotion; and 4) was treated less favorably than others who are not over forty.   Read More ›

You’re “Not That Pretty”, Part 1‎

The toughest part of this post, for me, is how to categorize this one: does this go in my file of “Things Not To Do At Work?”  Or is this one another example of “Lawyers Behaving Badly?” Or maybe “Generally Unacceptable Management Styles?” 

Well, I’ll let you decide.  But here is the takeaway: however you categorize it, it’s likely a bad idea to tell a woman that works for you that she’s “not that pretty,” that prior female employees were “smart…good-looking…just gorgeous” and used to wear tight sweaters, and that “it’s all been downhill since women got the vote.” 

Statements like that can give rise to allegations of gender discrimination in violation of Title VII of the Civil Rights Act that can survive a motion to dismiss.  That’s what the City of Evanston, Illinois learned last week, in Elke Tober-Purze v. Evanston, pending in federal court for the Northern District of Illinois.   Read More ›

Even When “Loss” Is Defined, Insurance Policy Interpretation For Executive Agreement Claims Can Still Be Tricky

What’s a “loss?”  And, no, I don’t mean something our beloved Washington Nationals have racked up in equal number to their wins this season. 

I’m talking about a loss as defined in an insurance policy – or, as the word is used in most insurance policies that apply to employment-related claims, a capitalized “Loss.”  Believe it or not, even when this term is specifically defined in an insurance contract, it can still cause confusion.   Read More ›

The Inbox – August 23, 2013 – The All Politics is Local Edition

    • Maybe it’s not fair to name a style of politics after that beautiful city by the lake, but the city’s case is not being helped by the finger pointing this week after an auditor said that the Metra rail agency’s insurance policy could have covered the costs of litigation with Metra’s former CEO Alex Clifford. The high cost of litigation apparently was used as a rationale for the $718,000 separation agreement between Metra and Clifford. This reminds us of one of our mantras here at Suits by Suitsif litigation is on the horizon, check your insurance policy!
    • Not that the academic style of politics seems much better. On Wednesday, the Iowa Court of Appeals reversed a jury’s award of $784,000 to a former Iowa State University employee who claimed that he was viciously harassed by his superiors after blowing the whistle on his boss for financial misconduct. However, the court left intact the jury’s $500,000 award to the employee for intentional infliction of emotional distress. At trial, the employee presented evidence that his superiors made false accusations to campus police that he was a security threat and potential mass murderer.
    • Here at home (no politics here!), the D.C. Superior Court ruled on Tuesday that three local police officers did not have a valid claim against the D.C. government. The officers contend that they were denied assignments and referred to internal affairs in retaliation for their speaking up about the ineffectiveness of breath-testing equipment used by the police department for suspected drunk drivers. The court found that the evidence does not support the officers’ allegations.
    • Finally, a new survey is out about office politics showing that most people prefer not to friend their boss on Facebook.

Paula Deen Ruling Also Reminds Us: Title VII Protects Employees Who Are Discriminated Against for Their Association with People of Other Races Outside of the Workplace

Basketball On Tuesday, we examined the dismissal by a Georgia federal court of Lisa T. Jackson’s race-based discrimination claim against Paula Deen and others, and noted that, under Title VII, an employer may not discriminate against an employee for associating with employees of another race.  But we don’t want you to be left with the impression that the association has to be between co-workers.  Courts also have recognized “interracial association” Title VII claims for associations occurring outside of the workplace.  The U.S. Court of Appeals for the Second Circuit is one such court. Read More ›

Paula Deen Ruling Reminds Us: Title VII Protects White Employees Who Are Discriminated Against for Their Association with Black Employees

Whirlpool WasherLast week, a federal court in Georgia dismissed Lisa T. Jackson’s race-based discrimination claim against Paula Deen, her brother Earl “Bubba” Heirs, and their restaurant businesses.  Earlier events in the Jackson v. Deen case – including Deen’s deposition testimony and what it may mean for alter ego liability – caught our attention at Suits by Suits.  This recent ruling interests us as a reminder that it is not always the case that a white employee who works in an environment that is hostile to blacks has no claim for damages against her employer for race-based discrimination. Read More ›

The Inbox - August 16, 2013

It’s unseasonably cool here in Washington, DC, where most of our Suits by Suits editors toil.  News about the latest in disputes between employers and executives, however, is always in season.  Here are the latest headlines:

  • Ruth Simon and Angus Loten of the Wall Street Journal brought us this excellent take on the rising tide of non-compete litigation.  According to Simon and Loten, non-compete agreements are spreading beyond the executive ranks to sales representatives, engineers, and researchers.  For more, check out our ongoing State-by-State Smackdown series on the changing law of non-competes in various states (here, here, here . . . and here).
  • A conference call hosted by AOL’s chief exec Tim Armstrong took an unpleasant turn when Armstrong fired – on the spot – Abel Lenz, an employee who was videotaping the call.  The New York Times reported that Armstrong later admitted that he made a “mistake” in the hasty firing, which was broadcast to a thousand employees.  Lenz’s photos of his last moments at AOL later surfaced online at jimromenesko.com
  • The Third Circuit upheld a decision by the Luzerne County (PA) Retirement Board to terminate the benefits it was paying to a former county clerk, William Brace, based on Brace’s guilty plea to a bribery charge.  Brace claimed that the termination violated his constitutional rights, but the court disagreed, holding that Brace was not entitled to a hearing before the decision.  Brace’s crime appears to have been the acceptance of a $1,500 tailor-made suit from a county contractor, which puts this case in the unique category of Suits by Suits over Suits.
  • Matt Reynolds of Courthouse News Service reported that IMAX has sued a competitor for trade secret misappropriation.  IMAX’s complaint alleges that Gary Tsui, a former IMAX employee, sold its 2-D and 3-D conversion technology to the competitor, GDC Technology USA, which is now using the secrets to compete with IMAX.  It calls Tsui an “international fugitive.”  Sounds like this case may be exciting enough for the big screen.
  • A former U.S. Bank manager, Serge Adamov, has successfully appealed the dismissal of his claim that he was terminated in retaliation for complaints of discrimination based on his Azerbaijani origin.  The Sixth Circuit held that when an employee does not exhaust his remedies in the Department of Labor before bringing suit in federal court, that failure does not deprive a district court of jurisdiction over the case.  As a result, because the bank did not raise a failure to exhaust as part of its motion to dismiss Adamov’s suit, the district court could not raise it on its own as a ground to get rid of the claim.

‎“Hell or High Water” or Fraud: Court Rules That Supermarket Scion Was Entitled To ‎Post-Termination Benefits Despite Misconduct ‎

Shopping cart full of moneyThe ongoing court drama between Marsh Supermarkets and Don Marsh, its former CEO, has taken another twist.  As we previously covered here, in February of this year, a jury in the U.S. District Court for the Southern District of Indiana found that Marsh, the son of the company's founder, defrauded the supermarket chain and breached his employment agreement by misusing company assets to pay for personal expenses.  It awarded Marsh Supermarkets $2,200,000 in damages.

Now, however, that damages award has effectively been zeroed out by the district court judge, who has found that Don Marsh is entitled to $2.1 million plus attorneys’ fees from the company based on a separate provision in his employment contract.  Order, Marsh Supermarkets, Inc. v. Marsh, No. 09-cv-00458 (S.D. Ind. Jul. 29, 2013).  The court accepted Marsh’s argument that the provision entitled him to payment come “hell or high water” – or fraud. Read More ›

Lawson v. FMR LLC: A Close Look at the Whistleblowers’ Opening Salvo in the Supreme Court

George ClooneyAs we’ve covered here and here, the Supreme Court will decide this term whether a whistleblower can pursue a Sarbanes-Oxley claim for retaliation by a privately-owned employer.  Jackie Lawson and Jonathan Zang, former employees of Fidelity investment advisory companies, say yes.  The First Circuit said no.

Lawson and Zang have now filed their opening brief in their attempt to persuade the Supreme Court to disagree with the First Circuit and reinstate their claim.  And they have even included a non-gratuitous George Clooney reference.  (Hat tip to scotusblog.com for making this and numerous other Supreme Court resources available.) 

Lawson and Zang’s argument involves the interpretation of 18 U.S.C. § 1514A, the provision of Sarbanes-Oxley that allows whistleblower claims.  They argue that the plain language of Section 1514A applies to protect not only employees of publicly-traded companies and mutual funds, but also employees of contractors of those companies, such as the Fidelity investment advisers at issue in their case.  The statute bars contractors from retaliating against an “employee”: Lawson and Zang contend that this should be read to refer to those contractors’ “own employees,” in addition to the employees of public companies with whom the contractors work.  Br. at 15.  They argue that it wouldn’t make any sense to only prohibit retaliation by contractors against others’ employees, since it would be very difficult, if not impossible, for a contractor to terminate someone else’s employee.  Br. at 22. Read More ›