North Carolina District Court Denies Discrimination Plaintiff’s Attempt to Compel Production of Defendant’s Net Worth Evidence

A ruling from the United States District Court for the Eastern District of North Carolina has denied an employment discrimination plaintiff’s motion to compel production of an individual defendant’s net worth information.  In so doing, the court aligned itself with other federal court rulings that have held that a plaintiff may obtain discovery of net worth information only after first establishing an actual prima facie entitlement to a punitive damages award.

The case, Jackson-Heard v. Elizabeth City State University, is an employment discrimination action brought by Mary Jackson-Heard, a former professor of accounting with the defendant school.  Claiming she was unlawfully terminated, the plaintiff asserted claims of race discrimination, age discrimination, and gender discrimination.  In addition to suing the University, the plaintiff also sued the Dean of the School of Business under 42 U.S.C. Section 1981. Among other relief, the plaintiff sought an award of punitive damages.

The plaintiff served discovery requests seeking detailed information and financial documents relating to the individual defendant’s personal net worth.  The plaintiff claimed that such information was discoverable in order to explore and develop her claim for punitive damages.  The defendant, however, objected to the requests on grounds that they were overbroad, unduly burdensome, and not reasonably calculated to lead to the discovery of admissible evidence.  The plaintiff filed a motion to compel production of the requested information.

In its ruling, the court acknowledged the intended broad scope of discovery.  The court also quoted the language of Rule 26 stating that relevant information, for discovery purposes, need not be admissible at trial so long as it is reasonably calculated to lead to the discovery of admissible information.  At the same time, the court noted the trial court’s broad discretion in determining relevance for discovery purposes.

Turning then to the specific issue at hand, the court acknowledged that a defendant’s financial position is relevant to the issue of punitive damages.  At the same time, however, the court pointed to several federal court decisions that have held that a plaintiff must establish a prima facie case of actual entitlement to punitive damages before requiring production of sensitive financial information.  The court determined that the plaintiff had not yet shown an entitlement to punitive damages and, also, found that the information the defendant had provided was sufficient in any event.  For the reasons, the motion to compel was denied.

The ruling provides defendants with some hope for limiting harassing discovery requests.  Under this ruling and the precedents cited, a plaintiff cannot pry into a defendant’s sensitive financial status by merely asserting a claim for punitive damages.  Instead, the plaintiff must establish that the punitive damages claim has actual merit.

The ruling represents a notable difference in philosophy between federal and state courts in North Carolina.  Frequently, North Carolina’s state court judges take much more liberal views on the permissible scope of discovery in civil lawsuits.  Many times, plaintiffs in North Carolina actions pursue punitive damages claims and promptly serve discovery requests seeking similar documents and information.  Although the scope of discovery standard is theoretically the same under both federal and state rules of civil procedure, state court judges are traditionally far more accommodating to requests for net worth information.

The Equal Pay Act Turns 50 - So What Does It Add Anyway?

Last month, the Equal Pay Act, a powerful if somewhat overlooked federal employment discrimination law, turned 50 years old.  Many employers and employees mistakenly believe that the Equal Pay Act (“EPA”) provides identical, redundant protection to that provided by the Civil Rights Act of 1964, the much more widely applied legislation known as Title VII.  In fact, the Equal Pay Act provides additional protections that are often times overlooked in the employment arena.

First, the Equal Pay Act does not require an aggrieved employee to file a charge of discrimination with the EEOC.  Therefore, an employee who has missed the relatively short deadline within which to file a charge of discrimination can still pursue a lawsuit under the EPA.  The statute of limitations under the EPA is two years.  The limitations period actually expands to three years in cases of willful employer violations.

Also unlike Title VII, the Equal Pay Act does not limit its reach to employers of at least 15 employees.  Consequently, small employers who escape regulation by Title VII can still be sued for pay discrimination under the EPA.

Like Title VII, the Equal Pay Act enables a prevailing employee to recover his or her attorney’s fees.  In addition, the EPA allows employees to obtain liquidated damages, which is an amount equal to the back pay awarded for the Equal Pay Act violation.  Although the EPA does not allow for punitive damages per se, the liquidated damages award essentially serves a punitive purpose.

Perhaps the greatest distinction between the two statutes is that an aggrieved employee is not required to prove discriminatory intent under the Equal Pay Act.  Instead, an employee need only prove that he or she received lower pay for substantially equal work as members of the opposite gender.  To some extent, this distinction makes proving an EPA claim easier.  The EPA does, however, also provide employers with certain specified defenses, such as merit and seniority systems and systems under which pay is determined by quantity or quality of production.

Even after fifty years under the Equal Pay Act, wage disparities remain commonplace.  Determining whether such a disparity constitutes a violation of the Equal Pay Act and/or Title VII can be a difficult and deceptive task requiring experienced counsel. 

Join us in person at an upcoming seminar!

Both contributors to this blog, Brian Alligood and Tasha Agruso, are speaking at the 9th annual Best Practices in Labor and Employment Law seminar on June 27, 2013.  It will be held at the DoubleTree by Hilton hotel, located at 3030 High Point Road in Greensboro.  Please join us in person.  In addition to the prepared presentations, you will be given the opportunity to ask questions of Brian and Tasha, as well as the other presenters.  

Click on this link to register on line.  You may also view more information about the seminar by clicking on this link to the online brochure.  We hope to see you there.

Protection from Pregnancy Discrimination Expands as Fifth Circuit Court of Appeals Determines Lactation Discrimination is Unlawful Sex Discrimination

In a recent opinion, the Fifth Circuit Court of Appeals has ruled that an employer’s decision to terminate a woman because she is lactating or expressing milk constitutes an actionable form of sex discrimination in violation of Title VII of the Civil Rights Act of 1964 (“Title VII”).

The case, EEOC v. Houston Funding, II, involved a mother who, in December of 2008, took leave from work for the birth of her child.   Before returning to work, the mother advised her supervisor that she was breastfeeding and asked whether it would be possible for her to use a breast pump at work.  The supervisor, in turn, posed the question to Harry Cagle, the company’s Limited Partner.  Mr. Cagle responded with, “No.  Maybe she needs to stay home longer.”

On February 17, 2009, the employee called Mr. Cagle to report that she had been medically cleared to return to work.  During this same conversation, she again mentioned that she was lactating and asked whether she could use a back room to pump milk.  According to the employee, Mr. Cagle paused at length before responding that her position had been filled.  On February 20, 2009, the company mailed a letter, dated February 16, 2009, to the employee stating that she had been terminated for abandoning her job.

The EEOC filed a Title VII lawsuit against Houston Funding alleging that it had discriminated against the employee, based on her sex, including her pregnancy and childbirth, by terminating her employment.  Houston Funding moved for summary judgment on grounds that Title VII does not prohibit “breast pump discrimination.”  The District Court for the Southern District of Texas granted the motion, finding that firing a person because of lactation or breast pumping is not sex discrimination.

The Fifth Circuit Court of Appeals reversed the District Court.  In so doing, the Court pointed to the Pregnancy Discrimination Act, which amended Title VII to make clear that sex discrimination includes “pregnancy, childbirth, or related medical conditions.”  The Court then concluded that lactation is a medical condition related to childbirth.  The Court also held that terminating a woman because she is lactating or expressing milk states a cognizable Title VII cause of action.  Without detailed discussion, the Court additionally concluded that ample evidence had been produced for finding the employer’s offered reason for the termination pretextual.  Consequently, the lower court ruling was vacated and the case remanded to the District Court.

The ruling sends a clear message that protection from pregnancy discrimination expands beyond the period of pregnancy and childbirth.  Women are equally protected from discrimination on the basis of medical conditions related to childbirth.

Finally, it should be noted that the Patient Protection and Affordable Care Act (“PPACA”), which was signed into law on March 23, 2010, added still additional statutory protections to breastfeeding mothers.  It did so by amending the Fair Labor Standards Act to require covered employers to provide “reasonable break time for an employee to express breast milk for her nursing child for 1 year after the child’s birth each time such employee has need to express the milk.”  Consequently, an employer who discriminates against a woman for expressing milk in the workplace today would face potential exposure under both the FLSA and Title VII.

As the above case law and statutory developments reflect, pregnancy and its aftermath continue to present significant legal issues in the workplace.  If you are confronting uncertainty with respect to legal rights and/or obligations arising from a current or recent pregnancy, you should contact experienced legal counsel for assistance.

North Carolina Federal Court Dismisses Wrongful Discharge Claims Under Both ADEA and North Carolina Equal Employment Practices Act

In previous posts, we have discussed the exacting proof that is necessary in order for a claim of age discrimination to prevail.  A United States District Court case from the Western District of North Carolina, Darnell v. Tyson Foods, Inc., demonstrates well the proof challenges an age discrimination plaintiff faces. 

As we explained in a previous post, the Court dismissed this case short of trial in part because it determined that a company’s decision to require a 63 year-old, forty year veteran employee to change to a third shift position, immediately after his return from prostate surgery, was not an adverse employment action.  The Court therefore determined that the plaintiff could not establish the second of four essential elements of a prima facie case of age discrimination.

In its decision, the Court also found that the plaintiff failed to establish the fourth and final element of the required prima facie case of age discrimination.  Recall from our prior posts that this fourth element requires a showing that the employment position from which the plaintiff was terminated remained open or that the plaintiff was replaced by a substantially younger individual.

In this case, the plaintiff was eventually replaced by a 57 year-old man.  In other words, the plaintiff’s replacement was only six years younger.  The Court therefore assessed whether a six year difference in age was sufficient to constitute replacement by a substantially younger individual.  After noting that the Fourth Circuit Court of Appeals (which is the Circuit that oversees North Carolina federal district courts), the Court found that sister circuits have generally found age differences of less than ten years insufficient to satisfy this prima facie case element.  The Court then determined, “[a]bsent any evidence to suggest discrimination, the six year age difference in this case is not sufficient by itself to satisfy the substantially younger requirement.”  Consequently, the plaintiff’s prima facie case failed for this further reason.

In the absence of a prima facie case of age discrimination, the plaintiff’s primary claim under the Age Discrimination in Employment Act (“ADEA”) was dismissed via summary judgment.

Finally, the plaintiff had also asserted an alternative claim for wrongful discharge under North Carolina state law.  The plaintiff based this claim on N.C. Stat.Gen § 143–422.2, a statute recognizing that it is against North Carolina public policy for an employer of 15 or more to discriminate, “on account of race, religion, color, national origin, age, sex or handicap.”  The statute is found in North Carolina’s Equal Employment Practices Act.  In its opinion, the Court made short work in dismissing this alternative claim for the same reasons cited in dismissing the federal age discrimination claim.  In this way, the Court concluded, as have other federal courts to consider the issue, that the North Carolina public policy claim is subject to the same analysis and proof standards as the analogous federal law cause of action.

Darnell demonstrates well the proof difficulties that claims of age discrimination face.  In addition, the case confirms that North Carolina public policy claims are hardly a panacea for claimants.  Although claims pursued under North Carolina’s Equal Employment Practices Act offers certain advantages, such as a longer limitations period and the option of foregoing EEOC administrative review, these claims are ultimately subject to the same substantive analysis and demanding proof requirements as claims pursued under the Age Discrimination in Employment Act.

Plaintiff in Race Discrimination Lawsuit Responds to the City's Motion for Summary Judgment

For those of you who live in the Triad area of North Carolina, you may recall that in 2005, the City of Greensboro police department was fraught with allegations of internal racial discrimination.  The police chief at the time was David Wray.  Mr. Wray ultimately resigned in the face of the racial discrimination allegations.  

Somewhat ironically, Mr. Wray then filed a discrimination lawsuit against the City of Greensboro in 2009.  Mr. Wray alleges that the City of Greensboro violated his rights under the Civil Rights Acts of 1866 and 1870, 42 U.S.C. § 1981.  In short, Mr. Wray alleges the city discriminated against him based on his race (white) in an effort to appease a segment of the African American community by publicly stripping him of his authority and forcing him out of office.  A copy of the complaint can be viewed by clicking here.

Our February 21, 2013 post discussed the City of Greensboro's motion for summary judgment in the case against it by former police chief, David Wray.  David Wray recently submitted his brief in response to the City's motion.  As promised, a discussion of Mr. Wray's response follows.

As expected, Mr. Wray contends that there are genuine issues of material fact for jury determination as to whether he was constructively discharged because of his race and, therefore, summary judgment is not appropriate.  A summary of the factual contentions he makes to support his claim of discrimination follows below.

Mr. Wray stresses that he began employment with the Greensboro Police Department ("GPD") in March of 1981 and was promoted to Chief of Police in July, 2003; the two chiefs prior to Mr. Wray were African-American.  Mitchell Johnson was the Assistant City Manager at the time Mr. Wray was promoted and allegedly led the police chief selection at that time.  Mr. Wray contends that the process of selecting him as police chief involved some discussion of his race.  Mr. Wray also points to Mr. Johnson's evaluation of him in November, 2004 when Mr. Johnson noted that "[a]s the first Caucasian Chief in many years David and his leadership teams actions are observed to the minutest detail."
 

Mr. Wray alleges that shortly thereafter, Ms. Miles and Mr. Johnson presented him with two options: 1) be terminated and lose substantial benefits that Mr. Wray had earned over the course of his career, or 2) resign and retain certain benefits in excess of what he would otherwise have received if he made certain admissions and refrained from defending himself.

Mr. Wray maintains that he resigned without the enhanced benefits.  Mr. Bellamy was officially promoted to the position of Police Chief shortly thereafter.  As previously discussed, in 2005, the City of Greensboro police department, under Mr. Wray's leadership, was fraught with allegations of internal racial discrimination.  Allegedly, Mr. Wray used an internal affairs unit to secretly investigate numerous black officers for alleged misconduct.  Furthermore, it was reported that a binder known as the “Black Book” allegedly contained photographs of black police officers.  As reported by NPR, there were rumors that crime suspects were sometimes promised more lenient treatment if they could identify black officers in the “Black Book” for misconduct.  Mr. Johnson became the City Manager in July, 2005, during the height of the "Black Book" controversy. 

Mr. Wray maintains that his actions were appropriate.  However, Mr. Wray alleges that Mr. Johnson succumbed to pressure from the African-American community insisting that Mr. Wray be replaced.  Mr. Wray contends that Mr. Johnson held a meeting with an attorney representing several African-American officers, the then City Attorney, Linda Miles, and the then Assistant Police Chief, Tim Bellamy.  Mr. Wray alleges that at that meeting, Ms. Miles and Mr. Johnson actively solicited information adverse to Mr. Wray.  Thereafter, Ms. Miles' office conducted an investigation of Mr. Wray and engaged an outside investigation firm to conduct its own independent investigation.

Mr. Wray contends that Mr. Johnson disregarded both the internal staff report that found no irregularities or discrimination in connection with the issues raised by the African American officers and the report ordered by the city and conducted by nationally recognized law enforcement professional Gil Klienlmecht that did not find irregularities in the department.  

Thereafter, Mr. Wray alleges that Mr. Johnson removed certain personnel duties from him, immediately reporting same in the local media.  Shortly thereafter, Mr. Wray contends that Mr. Johnson suspended him and took the "unprecedented step" of locking him out of his office.  Mr. Johnson then promoted Tim Bellamy, an African-American, to the position of acting Police Chief.
 
Mr. Wray also contends that a number of African-American officers complained that they were discriminated against because of their race during Chief White's and Chief Bellamy's respective tenures.  Mr. Wray contends that despite such complaints against those African-American chiefs, they were not stripped of any personnel duties, nor were they locked out of their offices.  In short, Mr. Wray alleges that he was treated differently than African-American police chiefs under similar circumstances.   

Mr. Wray also alleges that during the process for selection of his successor many publicly made comments explicitly or impliedly recognized race as a significant or qualifying factor to the position.  He also maintains that the City advertised the position in the National Organization of Black Law Enforcement Executives and the National Forum of Black Public Administrators.

Both the City and Mr. Wray's legal briefs correctly note that the ultimate question in every employment discrimination action involving a claim of disparate treatment is whether the plaintiff was the victim of intentional discrimination.  Mr. Wray, however, stresses that unless no rational fact finder could conclude that the employer's action was discriminatory, then his prima facie case together with his presented evidence of pretext is sufficient to defeat the City's motion for summary judgment.  

The City of Greensboro will have an opportunity to reply to Mr. Wray's brief, so it will still be some time before the Court rules on the City's motion for summary judgment.  We will discuss the City's reply once it is filed, so please check back.  

The complex factual and legal issues presented by this case are typical of employment discrimination matters, which is why it is of the utmost importance to engage experienced counsel to prosecute or defend employment litigation matters.  Please feel free to contact me directly at (336) 333-6375 to discuss this post or other North Carolina employment law matters. For more information about my Greensboro law firm of Sharpless &Stavola, please visit our website at www.sharpless-stavola.com.