Whistleblower suit

Court Weighs Whistleblower Suit For Violations of Company Policy

The state Supreme Court is considering how far New Jersey's whistleblower law can reach when an employee alleges retaliation for complaining about conduct that might have violated company policy but was not necessarily illegal.

The court on Wednesday heard arguments in Battaglia v. UPS Inc., A-86/87-11, an appeal from a judgment awarding damages to a United Parcel Service worker demoted and assigned to the night shift after reporting other employees' improper behavior to his supervisor.

Michael Battaglia complained about managers' actions that he thought violated UPS policy, such as making derogatory comments about women, misusing corporate credit cards and filing false expense reports in order to cover the costs of buying alcoholic drinks at lunches that stretched for hours.

Following a month-long trial before Superior Court Judge Phillip Paley, the jury found that UPS violated both the Conscientious Employee Protection Act and the Law Against Discrimination. It awarded Battaglia $500,000 for economic losses and $500,000 for emotional distress, though Paley reduced the emotional damages award to $205,000. The jury found no cause for Battaglia's claim for punitive damages.

The Appellate Division affirmed the CEPA violation, but vacated the emotional damages award and ordered a new trial. It also found that there was no reason to award punitive damages. Both sides filed appeals to the Supreme Court.

UPS's attorney, Michael Bissinger, told the court there was no basis for there to be a valid CEPA claim.

Battaglia, he said, was not engaging in protected activity when he complained about the alleged misuse of corporate credit cards because there was no UPS policy saying nondriver employees could not drink alcohol at lunch and putting that in their expenses.

Bissinger, of the Piscataway office of Day Pitney, said Battaglia would have to have believed there was evidence of some clear illegal activity, such as fraud, for him to be protected by CEPA.

"There is no CEPA claim when the activity does not violate internal policies," Bissinger said.

Chief Justice Stuart Rabner said Battaglia suggested there was the misuse of company credit cards.

Bissinger said there was no evidence that the employees were violating company policies or any criminal statutes.

Justice Anne Patterson asked whether Battaglia might not have understood company policy and believed he was reporting illegal or fraudulent activity. "Is that actionable?" she asked.

"I don't think so," Bissinger said. "We're talking about UPS internal policy, not laws. Maybe if they were drinking and then driving."

Appellate Division Judge Anthony Parrillo, temporarily assigned, asked whether Battaglia did enough of an investigation before voicing his concerns.

"He could have done more, and should have done more," Bissinger said.

Battaglia's lawyer, Maureen Binetti, told the court that Battaglia should receive CEPA protection.

"He was the quintessential UPSer," she said. "He is no longer the same person. His life was destroyed.

"Michael Battaglia tried to do the right thing," said Binetti, of Woodbridge's Wilentz, Goldman & Spitzer.

If a person has a reasonable, not frivolous, belief that there is improper conduct, CEPA should apply, she said. "That's what happened here."

"He's not required to be a lawyer," Binetti said. "He was trying to protect the company from fraud by its managers."

Patterson asked whether there was anything beyond the purported credit card misuse or manipulation of the meals expense system.

Binetti pointed to the evidence that Battaglia also complained about the derogatory remarks made about female employees.

Justice Helen Hoens asked whether Battaglia had concerns that the employees' behavior was causing poor work performance.

"That's correct," Binetti said. "He believed that because of all the abuses going on."

Justices Barry Albin and Jaynee LaVecchia recused, as did Appellate Division Judges Ariel Rodriguez and Mary Catherine Cuff, also temporarily assigned.

 

New Jersey Law Journal April 18, 2013

Jury: Pattern of removal to establish a prima facie

Peremptory Challenge to Juror of Defendant's Race Requires Reasons

It's well-established in New Jersey that discriminatory uses of peremptory challenges are illegal, but a published opinion on Tuesday addresses a wrinkle not found in earlier precedents.

In the usual scenario, where the state removes multiple jurors who share a trait such as race with the accused, the defense can show a pattern of removal to establish a prima facie case of discriminatory purpose, forcing the prosecution to provide a nondiscriminatory one.

In contrast, State v. Pruitt, A-1343-11, holds that the state's removal of a single African-American juror, the only one in a case against a black defendant, can be enough.

The result was the reversal of a Cape May County drug conviction and a remand for a hearing on the prosecutor's reason for striking the juror.

Markees Pruitt was convicted on multiple counts of selling crack cocaine to an undercover detective within 1,000 or 500 feet of school property. He is serving a 14-year sentence and is not eligible for parole until 2018.

Juror 13 was one of two African-Americans on the jury panel and was one of five jurors against whom Assistant Cape May Prosecutor Saverio Carroccia exercised peremptories. The other black juror was dismissed for cause.

The defense lawyer, Michael Schreiber, a Linwood solo, immediately asked for a side bar, at which he objected that striking Juror 13 left the panel with no African-Americans.

Schreiber asked Superior Court Judge Raymond Batten to require Carroccia to explain why Juror 13 was excused, in order to determine if the peremptory challenge was exercised for a valid reason or because of her race.

Carroccia argued that the "threshold showing" for requiring him to explain had not been made.

Batten called the circumstances "worthy of concern" and said the fact that "the only juror of color" was excused by the state was "certainly interesting," but "statistical reality cannot be denied."

He said he was unable to find that a prima facie case had been made that there was a "substantial likelihood" of a discriminatory purpose.

Batten also said he was "uncomfortable" with his ruling and suggested it would be better if there existed a legal basis to require the state to divulge why it asserted the peremptory challenge.

Reversing, the Appellate Division found Batten applied too stringent a standard, since State v. Osorio, 199 N.J. 486 (2009), relaxed the "substantial likelihood" test.

The panel held that removing a single member of a "cognizable group" — one based on race, religion, color, ancestry, national origin or sex — to which the defendant also belongs, can suffice to raise the inference needed to require the prosecutor to provide a nondiscriminatory reason.

"We ... conclude that whenever a prosecutor uses a peremptory challenge to excuse the only qualified member of a cognizable group in the jury panel, where the defendant or the victim is also a member of that same group, and where the other Osorio factors are met, the trial judge should, upon timely objection by the defense, require the prosecutor to explain his or her nondiscriminatory reason for the challenge," wrote Michael Haas, a Superior Court judge temporarily assigned to the Appellate Division.

"Requiring the prosecutor to provide such an explanation imposes no unreasonable burden upon the State and serves the interests of justice by ensuring that no juror is excused from service for unconstitutional reasons," he wrote. "Were we to hold otherwise, discriminatory challenges could escape judicial review whenever the representation of cognizable groups in a jury panel was particularly low."

Haas noted that Carroccia failed to ask Juror 13 any follow-up questions and he said the reason for dismissing her was far from evident in contrast to the other four people subjected to peremptory challenges. One of the four had a son-in-law in drug treatment, one had a cousin serving a life sentence for a double murder and two had acquitted defendants when serving as jurors in prior cases.

Haas was joined by Judges Paulette Sapp-Peterson and Jamie Happas.

Assistant Deputy Public Defender Jason Coe, who represented Pruitt on appeal, says, "I'm pleased with the court's sensitivity to issues affecting jury selection," but declines further comment.

Schreiber terms the ruling "encouraging," saying "time and time again, I struggle with getting a fair cross-representation of minorities on juries where my client's a minority." In his view, minorities are underrepresented among jurors because they tend to be poorer and jury pools are drawn from the ranks of taxpayers, licensed drivers, registered voters and applicants for homestead rebates and are thus more likely to own cars and homes and to have jobs.

U.S. Census figures for 2011 show Cape May County with a population of 96,304, which is 86.6 percent non-Hispanic white, 6.4 per cent Hispanic, 5.1 percent black and one percent Asian.

The Cape May County Prosecutor's office did not return a call. Assistant Prosecutor John Molitor handled the appeal.

The Supreme Court is scheduled to hear oral argument on April 30 in another case involving race bias in jury selection, State v. Andrews, A-105-11.

The trial judge there found a prima facie case that the defense used peremptory challenges to exclude white jurors in a murder case against a black defendant, who was subsequently convicted and sentenced to life in prison. Once the judge made the finding, he required the defense to provide a "rational, articulable reason" not related to race whenever it employed a peremptory against a white juror.

The Supreme Court granted an appeal on whether the judge should have scrapped the voir dire process and started over.

New Jersey Law Journal 4/23/13

Partial Deafness not a Disability under ADAAA

Partial Deafness Found to Not Be a Disability Under the ADAAA

There is a perception that since the passage of the Americans with Disabilities Act Amendments Act in 2008 and the issuance of the U.S. Equal Employment Opportunity Commission's guidelines in 2011, virtually any physical or mental condition will rise to the level of an actionable disability. The recent case of Mengel v. Reading Eagle, No. 11-6151, (E.D. Pa. Mar. 29, 2013), belies this perception. The case also is notable for its finding that the employee's complaint about a single potentially racist remark was not an objectively reasonable complaint of discrimination.

Totally deaf in one ear

Christine Mengel was a page designer for the Reading Eagle, the principal newspaper of Berks County, Pa., owned by Reading Eagle Co. Mengel had satisfactory evaluations from 2001 to 2008. In 2007, Mengel had surgery for a brain tumor and, as a result, became totally deaf in one ear and began to experience balance problems. Her 2008 evaluation was completed shortly after she began to experience these problems and, as noted, it was satisfactory.

In September 2008, Mengel had a meeting with her supervisors and a co-worker, Bill Reber, during which Reber complained that Mengel had not followed his instructions and referred to her as a "tar baby," according to the opinion. Mengel testified in her deposition that she believed the term was used to "demean" her and to "make [her] feel small."

Selected for layoff

In January 2009, the paper began to evaluate employees in preparation for a reduction in force (RIF). Managers were to use a matrix rating employees in seven categories. It was understood that the lowest-rated employees would most likely be affected by the RIF although, at the time the evaluations were performed, the number of employees to be affected had not been determined.

Mengel's RIF matrix was completed in March 2009. She received a score of 13 out of a possible 42 points, including a score of two (out of a possible score of six) in the "performance evaluation" category. Mengel's overall score was 11 points lower than the next-lowest-rated employee in her department.

It is not clear from the decision whether Mengel was aware of the impending RIF and her relatively low matrix score. It is notable, however, that she formally complained about the "tar baby" comment in April 2009, eight months after it was made. When the company did not investigate her complaint to her satisfaction, she filed an EEOC charge claiming that she was discriminated against in retaliation for her complaint, as well as on the basis of her gender and alleged disability. Ten days after Mengel filed her charge, she was laid off, along with two other employees in her department, both male. She brought suit after the EEOC concluded its investigation and Reading Eagle moved for summary judgment at the conclusion of discovery.

Not substantially limiting

The court first considered whether Mengel had set forth a prima facie claim of disability discrimination. The EEOC's regulations to the ADA state that "deafness substantially limits hearing" and that hearing is a major life activity. As such, deafness is a disability covered by the act. However, the evidence was that Mengel was deaf in only one ear and that the only impairment that she suffered was that she "had difficulty hearing in noisy environments." The court noted that "even under post-ADAAA regulations, 'not every impairment will constitute a disability within the meaning of the ADA.'" Although Mengel testified that she "didn't hear some things," she was not able to cite any specific instance where her hearing loss caused a problem. As such, the court found that Mengel was not "disabled" as a matter of law.

'Regarded as' claim fails

The company's knowledge that Mengel had "balance problems" related to her brain surgery was sufficient to establish a prima facie claim that she was "regarded as" disabled under the ADAAA. This is because "the ADAAA no longer requires a showing that [the plaintiff's] impairment was perceived to substantially limit a major life activity." Mengel's ADA claim failed, however, because she was unable to establish a causal connection between being regarded as disabled and the termination decision. This was largely because the company had learned of her balance problems well over two years before her termination and her supervisors had given her a satisfactory evaluation shortly after her surgery.

No objective belief in illegal conduct

Mengel also claimed that she was retaliated against for complaining about her co-worker's use of the term "tar baby." The court observed that the first element of a prima facie retaliation claim is having engaged in "protected activity." The standard is both objective and subjective, requiring that the employee establish that he or she "held an objectively reasonable belief, in good faith, that the activity [he or she] opposed is unlawful under Title VII."

In this case, it would be without dispute that the single use of an ambiguous term that sometimes (but not always) has racial connotations would not be severe or pervasive enough to create a hostile work environment. But the question was whether it was objectively reasonable for Mengel to have believed that she had been discriminatorily harassed. To this, the court found that "it is not reasonable for an employee to believe that a single, potentially racist remark could violate Title VII."

Moreover, the court found that Mengel did not have a good-faith belief that the comment was unlawful, as she complained only that the term made her "feel small."

The case is useful to counsel and their clients in considering whether a particular condition is covered by the ADA, even after the act was amended. While most conditions will still warrant such coverage, it remains important to analyze each condition, whether at the accommodation stage or in litigation, carefully in order to determine whether it does, in fact, substantially limit a major life activity.

Sid Steinberg is a partner in Post & Schell's business law and litigation department. He concentrates his national litigation and consulting practice in the field of employment and employee relations law. Steinberg has lectured extensively on all aspects of employment law, including Title VII, the FMLA and the ADA.

 

New Jersey Law Journal 4/12/13

Workplace Discrimination: Only Circumstantial Evidence Needed

Burden Eased for Railroad Worker Suing Over Retaliatory Discipline

A railroad worker suing over workplace discipline need only present circumstantial evidence of retaliation for his case to be heard by a jury, a federal appeals panel ruled on Tuesday.

Congress had relaxed the burden of proof for a plaintiff to establish a prima facie case and survive summary judgment, while tightening standards for railroads, the U.S. Court of Appeals for the Third Circuit said.

The changes were made in 2007 amendments to the Federal Rail Safety Act addressing allegations that railroads took action against workers who reported safety violations or claimed injury.

In its ruling in Araujo v. New Jersey Transit Rail Operations, 12-2148, the three-judge panel overturned dismissal of the suit — filed by conductor Anthony Araujo against the railroad — on summary judgment.

Araujo's lawyer, Charles Goetsch, says the suit is the first to address with the 2007 amendments.

Araujo alleges that he was retaliated against because of anxiety he suffered after watching a contractor, repairing a bridge over a railroad in Newark, be fatally electrocuted by an energized overhead catenary wire.

Although it was not his job assignment, Araujo mistakenly told the contractor, Anthony Clemente, that the wire had been de-energized.

Araujo was the only NJ Transit employee at the scene on Feb. 25, 2008. Two other employees whose job it was to inform contractors of the status of the wires — Christopher Picton and Jeff Meisner — had left.

Araujo was questioned by his supervisor, Joseph Meade, but, unlike Picton and Meisner, was not ordered to take a drug test.

A counselor with NJ Transit's Employee Assistance Program met with Araujo the next day over his anxiety and concluded he had suffered a workplace injury and couldn't work.

On March 5, 2008, Meade filed disciplinary charges against Araujo, claiming he violated safety rules that require conductors to ensure that people under their protection do not come into contact with catenaries unless the wires have been de-energized.

Araujo was cleared to return to work on Oct. 2, 2008, but was suspended without pay pending the outcome of the disciplinary charges.

A hearing officer upheld the charges and Araujo ultimately was suspended for the four months served. He then filed a complaint with the Occupational Safety and Health Administration's Office of Whistleblower Protection.

OSHA ordered NJ Transit to pay him $569,587, representing the $345,754 value of his home which had been foreclosed on, $75,000 in punitive damages, $50,000 for damage to his credit score, $40,271 for lost wages, $23,350 for lost benefits, $17,915 in counsel fees, $12,297 for the value of his repossessed car and $5,000 for pain and suffering.

NJ Transit objected and, under FRSA rules, Araujo sued alleging wrongful retaliation in violation of the statute.

U.S. District Judge Stanley Chesler held that Araujo did not meet even the reduced burden-shifting standards in the FRSA.

But, writing for the appeals panel, Judge Robert Cowen said Chesler was wrong.

Cowen noted that in approving the 2007 amendments, Congress adopted the burden-shifting whistleblower standards in the Wendell H. Ford Aviation Investment and Reform Act for the 21st Century, known as AIR-21.

Those standards require a plaintiff to show by a preponderance of the evidence that the unfavorable action was in response to protected activity — in this case, seeking time off because of a workplace injury.

If the employee makes that prima facie case, Cowen said, the AIR-21 standards then shift the burden to the employer to show by clear and convincing evidence that the action would have been taken regardless of whether the employee engaged in protected activity.

"The District Court apparently did not recognize that, in fact, the FRSA explicitly incorporates the AIR-21 burden-shifting by reference," said Cowen, joined by Joseph Greenaway Jr. and Morton Greenberg.

To meet the clear and convincing evidence burden, the employer must show that the truth of its contentions is highly probable, he said.

The AIR-21 standards for allowing a case to move beyond summary judgment are less strict than those established as the "default" standard in McDonnell Douglas v. Green, 411 U.S. 792 (1973), Cowen said.

Under McDonnell Douglas, the employee must establish a prima facie case of discrimination. Then, the employer must produce evidence of a legitimate nondiscriminatory reason for its actions. If this occurs, the presumption of discrimination disappears.

The employee must then present evidence showing an inference of discrimination — demonstrating that the defendant's explanation is insufficient and only a pretext or proving that the defendant's actions were discriminatory.

Cowen said the AIR-21 burden-shifting standards are similar to those in the Energy Reorganization Act, which placed "tough" burdens on employers in the nuclear industry because of a history of retaliation against whistleblowers.

"The 2007 FRSA amendments must be similarly construed, due to the history surrounding their enactment," Cowen said.

The panel noted that NJ Transit made several significant points, for example that Araujo could not argue disparate treatment because, in the five years before the accident, no conductor had engaged in similar conduct. And, NJ Transit argued, Araujo did violate safety rules.

Cowen said those arguments were not enough because Araujo had established a prima facie of retaliation.

"We emphasize that Araujo has not articulated an overwhelming case of retaliation ... Araujo's evidence is entirely circumstantial, and we express no opinion as to the strength of his evidence," Cowen said.

"Viewing the facts favorably to Araujo, a reasonable jury could find that Meade decided not to drug test Araujo on February 25, 2008 because he did not believe that he violated any rules or was responsible for the accident, and that NJT decided to file disciplinary charges only after Araujo reported his injury," Cowen said.

Goetsch, of Cahill, Goetsch & Perry in New Haven, Conn., says that before the FRSA amendments, "employees basically had no rights at all."

The state Division of Law is representing NJ Transit. A spokesman, Lee Moore, declined to comment because the matter has been remanded.

Nancy Snyder, a spokeswoman for NJ Transit said the railroad does not comment on pending litigation.

New Jersey Law Journal 2/21/13

Race Influences Criminal Sentences

RACE INFLUENCES CRIMINAL SENTENCES, RESEARCH INDICATES

Fresh research into the so-called "racial gap" in criminal sentencing appeared to confirm that race plays a role in whether judges send defendants to jail, although to a degree that varies widely between judges. Researchers spent seven years collecting and analyzing decades of data on felony sentencing in Cook County, Ill., to determine whether and how race affected the way judges decided to send defendants to prison and for how long. "We find evidence of significant inter-judge disparity in the racial gap in incarceration rates, providing support for the model where at least some judges treat defendants differently based on their race," the researchers wrote.

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Lawsuit: Walmart sued over "All Black People Must Leave"

Walmart is being sued by a shopper who claims he suffered emotional distress from a rogue public address announcement at its Turnersville store. On March 14, 2010, shoppers heard a male voice calmly announce, "Attention Walmart customers: all black people must leave the store." A few minutes later, a manager went on the loudspeaker to apologize for the remarks. The store later learned by examining surveillance-camera footage that a 16-year-old had made the announcement. The teenager was prosecuted for harassment and bias intimidation. But Donnell Battie, who is black, claims Walmart was negligent and reckless, and showed deliberate indifference, by not safeguarding the P.A. system.

 

WALMART SUED OVER P.A. ANNOUNCEMENT TELLING BLACK SHOPPERS TO LEAVE STORE

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Former Quick Check Employee Claims Discrimination Due to Illness

LABOR AND EMPLOYMENT — DISCRIMINATION

25-2-4927 Martin v. Quick Chek Corp., App. Div. (per curiam) (12 pp.) Plaintiff appeals a discovery order limiting his access to a supervisor's work notebook to those pages on which he was mentioned, an order granting summary judgment to defendant, and an order denying his motion for reconsideration of the grant of summary judgment in this action alleging wrongful termination and discrimination as a result of his Parkinson's disease in violation of the Law Against Discrimination. The panel affirms. The trial judge did not err in limiting plaintiff's access to the entire work notebook as it contained confidential personnel information relating to other employees not relevant to this litigation. The court did not err in granting summary judgment as the two factual inconsistencies asserted by plaintiff do not amount to a dispute of material facts; the LAD is not offended by a private company's strict enforcement of its no-tolerance drug policy; there is no legal precedent to support plaintiff's claim that defendants' awareness of his disease triggered a legal obligation to disregard his explicit request for a demotion and offer an accommodation that would allow him to maintain his manager position where he did not request an accommodation; and since summary judgment was properly granted in Quick Chek's favor, the individual supervisors cannot legally be held liable.

 

NJLJ 1/18/2012

 

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Employment Law: Discrimination Lawsuit

LABOR AND EMPLOYMENT — LIABILITY

25-2-4438 Senisch v. Carlino, App. Div. (Ashrafi, J.A.D.) (15 pp.) Pursuant to the 2005 Health Care Professional Responsibility and Reporting Enhancement Act (colloquially called the Cullen Act), N.J.S.A. 26:2H-12.2c, and also pursuant to prior case law establishing a qualified immunity for truthful job references by a former employer, defendants could not be held liable in a civil lawsuit for responding to a reference request with negative information from the personnel file of plaintiff, a physician's assistant. Defendants were not required to include in the reference plaintiff's version of the circumstances of his termination since the settlement of a prior Conscientious Employee Protection Act and Law Against Discrimination lawsuit he brought did not include an admission of wrongdoing by defendant-former employer.

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Is Revoking Handicap Parking Privileges Discrimination?

REAL ESTATE — DISCRIMINATION

34-2-4386 Shearn v. Victoriana Condominium, App. Div. (per curiam) (20 pp.) This is an appeal from the final decision of the Division of Civil Rights finding no probable cause that defendants had acted in a discriminatory manner toward appellant when they refused to grant him a disability accommodation to allow him to resume parking his car in the lot of the condominium complex where he is a unit owner. Appellant's parking privilege had been revoked because he was substantially in arrears on his monthly assessment fees. Finding that appellant met his initial burden of showing that an accommodation was necessary for his equal use and enjoyment of his unit, that defendant-association had exercised its rights under the condominium bylaws and had also revoked the parking privileges of many other unit owners similarly in arrears, that appellant was not declared disabled until after being notified of the suspension of his parking privilege, and that defendant has appropriately asked for medical documentation of the disability that appellant did not timely provide, the panel concludes that the director of the DCR did not abuse his discretion by finding no probable cause.

 

NJLJ 11/28/2011

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Workplace Discrimination

NO GENDER BIAS FOUND IN WORKPLACE RIFE WITH CRUDE, 'BOORISH' LANGUAGE
Abrasive and impolite comments by a manager or co-workers may make for an unpleasant workplace, but if it's directed toward everyone, it's not actionable under the state Law Against Discrimination, an appeals court says. On Wednesday, the Appellate Division affirmed a trial judge's ruling that there was no gender discrimination at play in the vulgar and dismissive language at an auto dealership where the plaintiff was the sole female employee. "Personality conflicts, albeit severe, do not equate to hostile work environment claims simply because the conflict is between a male and a female employee," the two-judge panel said in Miceli v. Lakeland Automotive Corp., A-3207-19.

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