June 2009 Archives

June 30, 2009

Norfolk Kmart Sued for Disability Discrimination

The Equal Employment Opportunity Commission (EEOC) claims a Kmart Super Center in Norfolk, Virginia, fired a store greeter because he used a cane, in violation of the Americans with Disabilities Act (ADA). In a lawsuit filed in the United States District Court for the Eastern District of Virginia, the EEOC alleges that the employee used a cane to walk and stand due to his spinal stenosis, a physical impairment of his back. His back problems did not prevent him from performing his duties as a greeter. Nevertheless, the suit claims, when he was observed using the cane, Kmart terminated his employment.

Prior to terminating the employee, Kmart allegedly refused to allow him to use the cane, even though his condition made it difficult to stand or walk without one, and his job required both. The EEOC filed the lawsuit only after Kmart refused to settle.

The EEOC is seeking most of the remedies permitted under the ADA, including kmart-logo.jpgreinstatement of the employee's job (or placement into a substantially equivalent position), back pay, compensatory damages, and punitive damages for intentional discrimination. The EEOC is also seeking an injunction (as it usually does in the ADA cases it brings) prohibiting discriminatory practices and compelling Kmart to adopt and execute a variety of policies, practices, and training programs to clarify to their employees and the general public that Kmart will takes steps to ensure it does not discriminate against persons with disabilities.

Title I of the ADA requires employers with 15 or more employees to provide qualified individuals with disabilities the same employment benefits and opportunities as everyone else, provided the employers can make any necessary accommodations without experiencing undue hardship. The employment privileges to which the ADA applies include recruitment, hiring, training, compensation, promotions, and even social activities. For more information, see Your Rights as a Disabled Employee.

June 19, 2009

BB&T Wins Summary Judgment in Virginia Employment Case

Proving once again that no good deed goes unpunished, a former employee of BB&T Insurance Services to whom BB&T graciously paid 30 days of severance pay despite terminating his employment for cause--and apparently without requiring the employee to sign a release--sued the company for wrongful termination. On June 17, 2009, however, Judge Wilson of the Western District of Virginia in Harrisonburg had "no hesitancy" in tossing out the case on summary judgment.

The employee's job duties involved identifying, contacting, and providing services to existing and potential new insurance customers. To assist him in performing those duties, BB&T allowed him to use a company laptop with access to confidential files on the company's network. At the time of his termination, the employee had 8 years' worth of sensitive client information stored on his laptop.

While traveling, the employee left the laptop unattended overnight in his vehicle while it was parked in a hotel parking lot. It was stolen. When BB&T learned of the theft, it notifiedlaptop.jpg those of its clients affected by the data breach and offered them a credit-monitoring service. These programs cost the company over $24,000.

BB&T fired the employee for "cause," defined in the parties' employment agreement as "termination...for failure of Employee to adhere, after Employee has received written notice from [the Company] of such failure, and been given 30 days in which to cure such failure (if such failure can be cured), in any material respects to written policies, procedures, and the Code of Ethics established from time to time by [the Company]...." BB&T had distributed policies indicating in clear terms that all employees in possession of sensitive company information were obligated to protect the information, which duty included specifically a prohibition against leaving laptops unattended in vehicles.

The court threw out the employee's breach-of-contract case, rejecting his arguments that he was not bound by the parent company's policies, and that even if he were, he should have been given 30 days in which to "cure" the violation. The court found both arguments entirely lacking in merit, writing that no jury could reasonably agree with them.

June 13, 2009

Virginia Lottery Must Be Accessible to People with Disabilities

Both the Americans with Disabilities Act (ADA) and the Virginians with Disabilities Act (VDA) prohibit stage agencies and public entities from discriminating against people with disabilities, or denying to them the benefits of their services, programs, or activities. On June 4, 2009, Virginia's highest court held that the Virginia Lottery, a state agency established to generate revenue to be used for public purposes, must comply with these laws and ensure that disabled persons are not excluded from participation in the lottery.

At issue was whether the lottery operation constitutes a "program, service, or activity" within the meaning of the ADA and VDA.  A group of disabled plaintiffs, all of whom use wheelchairs, sued the Lottery in Richmond, claiming that several retail outlets lacked accessible parking spaces, ramps, and paths of travel for disabled persons.  The Lottery argued that it was exempt from the ADA and VDA because it did not offer a program, service, or activity within the meaning of those statutes.  While the Circuit Court agreed with that argument, the Supreme Court reversed, finding that the Virginia Lottery does operate a "program, service, or activity" and therefore must conduct its operations in compliance with the ADA and the VDA.


VirginiaLotteryLogo.jpg

The tricky part is determining how, exactly, accessibility is to be achieved. The only party responsible for complying with the ADA with respect to a particular challenged government program is the party with control over that program. (See Bacon v. City of Richmond, 475 F.3d 633 (4th Cir. 2007)).

The Virginia Lottery is the entity that operates the lottery, but it is permitted to license authorized agents--independent retail stores--to sell lottery tickets. The court acknowledged that the Lottery doesn't have the authority or power to require private businesses to comply with the ADA or VDA. The Lottery cannot simply construct wheelchair ramps on the premises of the various lottery retailers. At the same time, however, the court found that the Lottery has a broader obligation to ensure its operations are conducted in compliance with the laws.

How then, is the Virginia Lottery to comply with its obligations to disabled persons when it lacks the power to force its retailers to do the same? That is a question for another day, to be determined by the trial court when the case is returned to it. The Supreme Court suggested the remedy might entail something short of ramp construction, in that "accessibility" might be achieved by means other than physical.

June 6, 2009

Loudoun County Judge Rejects Bright-Line Test for Work Product Protection

In a case brought by two ousted golf-club members against the Benchmark Management Company, the management company behind Lansdowne Golf Club in Leesburg, Virginia, Judge James H. Chamblin ruled that a "case by case" test for determining applicability of the work-product doctrine is preferable to the "bright-line rule" several other Virginia courts have followed.  

At issue was whether 23 internal Lansdowne documents concerning an alleged assault on the premises were prepared "in anticipation of litigation" within the meaning of Virginia Supreme Court Rule 4:1(b)(3), which provides that a litigant may not compel an opponent to produce copies of documents prepared in anticipated of litigation except under certain limited  circumstances.  After reviewing the documents privately, Judge Chamblin found that the documents were prepared in anticipation of litigation and that, because there was no argument by counsel that any exception applied, the documents were protected from discovery by the work-product doctrine.  

Lansdowne.jpgThere has not been a consensus among Virginia circuit courts with respect to determining when litigation is "anticipated."  Some courts apply a bright-line test that applies work-product protection to a document the moment an attorney becomes involved.  Other courts decide the issue on a case-by-case basis, examining the particular facts and circumstances of each case and determining whether litigation was reasonably foreseeable, regardless of whether an attorney has been retained.  Judge Chamblin favored the case-by-case approach "because things can be done in anticipation of litigation before an attorney becomes involved."

When companies establish internal policies to investigate, document, or otherwise manage incidents involving violence, accidents, contract disputes, or other problems, and the purpose of the policy is to protect the company from litigation, courts applying the case-by-case test will generally not require the company to share any documents prepared pursuant to that policy with an opposing party in subsequent litigation.  
June 3, 2009

EchoStar and DISH Network Held in Contempt for Violating Injunction

TiVo won its patent infringement case against EchoStar, DISH, and affiliated companies back in 2006, obtaining a ruling that EchoStar's digital video recorder ("DVR") violated certain claims of U.S. Patent No. 6,233,389, owned by TiVo, and obtaining an injunction against future patent violations.  In response to the ruling, EchoStar developed a supposed "workaround."  On June 2nd, 2009, the court held that the workaround did not cure the infringement.  The court held them in contempt of court for violating the injunction and again ordered them to stop using TiVo's technology.

EchoStar, the company behind the DISH Network satellite television service, designs digital video recorders that it provides to customers who subscribe to its satellite T.V. service.  TiVo's '389 Patent relates to a similar system that allows for simultaneous storage and playback of television signals from sources such as cable and satellite providers.

At the conclusion of the 2006 trial, the jury found that EchoStar's DVR receivers infringed nine claims of the '389 Patent, either literally or under the doctrine of equivalents.  After the verdict, EchoStar and its engineers went to work redesigning their DVR machines to avoid infringing the '389 Patent.  Two years later, TiVo moved to hold EchoStar in contempt, arguing that the redesigned DVR's continued to infringe TiVo's patent.

The seminal case governing contempt proceedings in patent cases is KSM Fastening Systems, Inc. v. H.A. Jones Company, Inc., 776 F.2d 1522 (Fed. Cir. 1985), which held that a contempt proceeding for violation of an injunction issued in a patent case, "while primarily for the benefit of the patent owner, nevertheless, involves also the concept of an affront to the court for failure to obey its order."  The KSM case also held that contempt is to be viewed as a "severe remedy" which should not be employed if there is any doubt with respect to whether the defendant has violated the terms of the injunction. 

Despite EchoStar's allegations that it had changed 5,000 of the 10,000 lines of DVR source code and that it had spent over $700,000 in its redesign efforts (neither allegation of which the court found to be relevant to its analysis), the court found that (1) any differences between the product found earlier to be infringing and the redesigned DVR were "no more than colorable" and that (2) the redesigned DVR machines continued to infringe on TiVo's patent.  (Note: TiVo also pointed out that EchoStar spent much more--approximately $50,000,000--on its "Better than TiVo" advertising campaign, though the court didn't find that fact particularly relevant, either).  Consequently, the court held EchoStar in contempt of its permanent injunction. 

The court deferred ruling on monetary sanctions, but expect the eventual award to be substantial.  "The harm caused to TiVo by EchoStar's contempt is substantial," the court wrote.  "EchoStar has gained millions of customers since this Court's injunction issued, customers that are now potentially unreachable by TiVo."