Ellen Simon has a long and very good analysis at her Employee Rights Post. She concludes that Jones provides help to age discrimination plaintiffs by suggesting that even under Gross they should be held to the same evidentiary standards as other discrimination plaintiffs. 

Set aside a few minutes and take a look.  It will be worth your time whether you are an employer or a potential plaintiff.

This post from the Blog of Legal Times lays out the basics.  Plaintiff sued in state court; the employer removed the case to federal court and filed an answer.  Six months later the plaintiff decided that she wanted to dismiss the complaint voluntarily and filed a motion to do so.  The court denied the motion, on the procedurally correct ground that that once an answer is filed a case cannot be dismissed unilaterally by the plaintiff.  Thus, the order forced the action to continue. 

Here the story gets fuzzy.  It's not clear whether the court denied plaintiff's motion to dismiss for some deficiency in her application, or because the defendant objected to the dismissal.  If the latter, why would a defendant turn down a "get out of jail free card" in the form of a voluntary dismissal?  They might, I suppose, just be trying to make the plaintiff or her attorney sweat a bit.  But another possibility is that, because an age discrimination case is a fee-shifting case, the defendant may think that  it will prevail on the merits and can force the plaintiff to pay their attorney's fees.  It's rare for courts to award counsel fees in favor of defendants, but it does happen occasionally.  If that is what's in play (and I admit that I'm speculating), the litigation could be financially catastrophic for the plaintiff.  Few individuals --- and especially those who have lost their jobs --- have the financial resources to reimburse the hundreds of thousands of dollars that defendants routinely spend to defend discrimination cases.  Talk about shooting yourself in the foot.

So for plaintiffs and their lawyers, it's important not to start a fight precipitously.  Once you start the boulder of litigation rolling down the mountain, you may not be able to stop it without getting crushed.

This case illustrates things that are worth remembering, whether you are an employer or employee. 

First, the jury found that PQ's discrimination against the scientists was willful.  That resulted in a doubling of the back pay that they were due.

Second, the jury apparently accepted the plaintiffs' argument that PQ "cooked the books" to make it look like they were downsized for financial reasons unrelated to their age.  Trial lawyers know that if a jury thinks that you're lying, they will come down hard on you.  That seems to have happened here. 

Third, $6.2 million is not the end of PQ's financial trouble.  Motions are pending for attorney's fees, which certainly will run into six figures, and to gross up the award so that the plaintiffs do not suffer from having all of that income taxable to them in one year.

Downsizings are difficult on many levels.  Companies need to be sure that their age-related analysis of the impact of the employees selected is done fairly and honestly, and not merely to justify management's desire to get rid of age-protected employees.

The bill, text here, has a retroactivity provision that would return things to the way they were before the Gross decision.  The bill would also make the disparate impact theory available in cases that were pending as of the date of the Gross decision, and that were filed after.

The odds are strong that the bill will be passed.  Age plaintiffs with pending cases may want to seek stays of proceedings until the legislative process completes, one way or the other.  Employers, on the other hand, may want to seek to expedite litigation, or consider settlement of marginal claims, before the law changes unfavorably for them.

First development: can an employer be liable for age discrimination in a hiring situation made on the employer's behalf by an independent contractor?  Yes, according to the Court of Appeals for the Second Circuit.  The case is Halpert v. Manhattan Apartments, Inc.                                 

"If a company gives an individual authority to interview job applicants and make hiring decisions on the company’s behalf, then the company may be held liable if that individual improperly discriminates against applicants on the basis of age. " 

That seems logical enough.  Just be mindful of the fact that the person doing the hiring does not need to be a general agent for the employer.  A limited agency that authorizes nothing more than a hiring function can still impose liability for discrimination on the employer.

Second development: Allstate has settled an age discrimination class action for $4.5 million.  Again demonstrating that discriminatory behavior can be very costly to employers. 

Here's an interesting post from the Employer Law Report that suggests, accurately I think, that it will ---just barely --- not go as far as the front office of the Chicago Black Hawks hockey team.

More interesting is its link to a statement that Congress intends to hold hearings to overturn the Gross decision, ala the Lilly Ledbetter case.

Here's a portion of the statement of Chairman George Miller (D-CA) of the House Committee on Education and Labor:

A narrow majority of the Supreme Court has once again overturned decades of precedent and congressional intent and sided with powerful corporate interests on a workplace discrimination case. Like with the Lilly Ledbetter case, Congress may be forced to clarify the law’s intent so we can prevent the damage this decision will have on workers’ civil rights. The court’s ruling was unacceptable, and this Congress will work to protect all Americans’ ability to be treated fairly on the job. Employment decisions should be based on merit, not prejudice.

Mr.  Chairman, I understand that you work in Washington, and measured language is not always the order of the day.  But to say that the Supreme Court "has once again overturned decades of precedent and congressional intent . . .?"  Please.  Take it from one who represents both employers and employees in discrimination cases.  The best that can be said is that the congressional intent was murky and the precedents baffling.  That was a point on which the justices and all lawyers agreed. 

If Congress thinks that the Court's decision should be overturned for policy reasons, fine.  That's how our system works.  But to suggest that the Court arbitrarily overruled "decades of precedent" with some malicious intent is not an objective and even-handed way to approach the issue.

Here's a summary article from Lawyers USA  which does a nice job of summarizing the issues. 

The problem is complex, and the EEOC will be trying to provide some guidance. 

What's happening on the federal level begs the question of whether New Jersey courts will follow the lead of the US Supreme Court on mixed motive age cases.  While New Jersey usually follows the federal lead on the interpretation of anti-discrimination statutes, our state courts have  well-developed case law on mixed motive issues.  I wonder whether the state courts will be quick to follow the Supreme Court's lead, or will leave the state courts as a more receptive forum for plaintiffs in age discrimination cases.

Carter Phillips, the attorney for the defendant, is a respected and experienced Supreme Court advocate.  He described the case this way:

It does seem to me in some ways the Petitioner and Respondent in this case are ships passing in the night because the issues here are unbelievably complicated. I will say in 25 years of advocacy before this Court I have not seen one area of the law that seems to me as difficult to sort out as this particular one is.

Here's my suggestion.  For the lawyers who are reading this, if you have a spare half hour, read the transcript.  It's guaranteed to make your head spin.  At oral argument it made every participant's head spin, including every Justice who spoke.  (Justice Thomas, as is his practice, said nothing, which probably was wise.  Everyone else was openly and unabashedly confused.)  

For you non-lawyers, just keep monitoring our posts and we'll let you know what happens.

It's hard to predict how this case will be decided.  It will probably be in a narrow way that will interest mostly employment lawyers.  But there's a small --- very small --- chance that Gross v. FBL will produce some real fireworks in terms of how employment discrimination cases are tried.

Here's an LA Times article with more detail, the Supreme Court's order denying certiorari, and the EEOC rule.  

As the article aptly points out, the ADEA and coordinate state age discrimination laws are the only anti-discrimination statutes that will apply uniformly to all workers, so there's something in these cases for all of us.  And, as the population as a whole ages, there will be increasing numbers of older workers in the economy.

The five age cases that are before the Court will likely impact on older workers for many years to come. 

Those sentiments (and perhaps a few others) must be floating around the hallways at Northwest Airlines, where the company and its pilots' union, the Airline Pilots Association, have joined forces to  save a new retirement plan from an age discrimination challenge by a group of senior pilots.  Yahoo Finance has the AP story.

Northwest and the ALPA have asked a federal judge "to declare that it's not age discrimination to tilt retirement contributions to less-experienced pilots to make up for freezing their pensions."  Unlike some other airlines, a bankrupt Northwest chose not to reduce retirement benefits by terminating  its pension plan and turning its obligation over to a federal guarantor.  Instead, Northwest kept the retirement plan but froze its pensions, so that pilots received what they earned, but their pensions stopped growing.  To make up the difference, Northwest supplemented the pension plan with a 401(k) plan, which included a company match.  Ironically, however, under this arrangement the larger 401(k) matching contributions went to the higher paid, more senior pilots.

Because of that, Northwest argued that the new plan had the perverse effect of giving older pilots who lost nothing on their pension more than they would have received before their pension was frozen. Meanwhile less-experience pilots made far less.

On December 1, with the agreement of the ALPA, Northwest terminated its matching payments.  They will resume on January 1, this time with the larger matches going to less-senior pilots in order "to equalize the difference between experienced pilots who will get their full pension, and younger pilots who no longer have the opportunity to see their pension grow."  The goal is to produce similar retirement income levels for both senior and junior pilots.  And that sounds only fair.

The plan is being opposed by some senior pilots as discriminatory based upon age.  The junior pilots, without the change, would be getting the worst of both worlds.

The case serves to illustrate how difficult it can be to reconcile the demands of groups of employees with competing economic interests.  And it moves us to raise another question that employment lawyers often ponder: "Who woulda thunk it?"

What's going on here?  I thought that gray hair is indicative of experience and wisdom, good things in a lawyer.  Is there really a trend towards getting rid of middle aged lawyers in favor of younger folks?  Has anyone seen other evidence of such a trend?

An interesting question will the the impact of Toll's status as an equity partner in Sills Cummis.  We've previously posted on a similar issue in the context of a medical practice.

The case also asserts a claim under NJ's oppressed minority shareholder statute, which presents an interesting attack not often seen in this kind of litigation.

Our guess is that after some initial skirmishing, this one will be settled, but we'll follow it nonetheless.

Due to the settlement, interesting and important questions about what it means to be a "partner" in a large law firm will not be decided by the court, at least not in this case.  Francis Pileggi of the Delaware Corporate and Commercial Litigation Blog has some thoughts on the subject, as does Professor Larry Ribstein on Ideoblog.    

A somewhat similar case was decided in New Jersey in 2006, where the issue was the definition of "employer" for purposes of CEPA, New Jersey's whistleblower law.  You can follow up through our post on Feldman v. Hunterdon Radiological Associates, bearing in mind that the issues, though similar, are not identical.

1. It's frequently as expensive as litigation, and sometimes more so.  If nothing else, you get a judge's time for free, but you have to pay an arbitrator an hourly rate.
2. While arbitration ostensibly provides a level playing field, in reality it isn't always so. 
3. Arbitrators vary widely in background and predisposition.  Most are attorneys who have private practices as their primary sources of income, and in the employment field typically represent either employees or management.  Some are more  competent than others.  Few have a published record from which to understand their views of legal issues until it's too late. 
4. An unjust arbitration award is, for all practical purposes, virtually impossible to appeal successfully.

It's the fourth item --- the near impossibility of a successful appeal of an arbitration award --- that brings us to today's topic.  Because, in a recent employment case, a plaintiff who won an age discrimination arbitration based upon violation of the Age Discrimination in Employment Act [ADEA]but was denied the statutory remedy of having his attorney's fees paid by the losing defendant, achieved the nearly impossible and got a court to order that the defendant pay his fees.

And this tells us just how seriously the court viewed the arbitrator's attempt to deny the plaintiff a statutory remedy.

Here's the opinion in Porzig v. Dresdner Kleinwort, decided August 7, 2007.

Arbitral awards can be appealed under just a few legal theories, generally involving arbitrator misconduct, ir if the arbitrator exhibits a "manifest disregard of the law."

Here the NASD arbitrators made a concerted effort to significantly reduce the fee for Porzig's attorney.  In doing so, the arbitrators ignored the "lodestar" analysis (basically hours expended times hourly rate) that has been the accepted standard in the federal courts for years.  The court noted that an award of fees calculated under the lodestar analysis is mandatory --- it must be awarded to a successful plaintiff.  So eventually Porzig's attorney got paid what the law said that his efforts were worth, not what the arbitrators subjectively thought they were worth.  Their failure to decide in accordance with the settled law constituted a "manifest disregard of the law."

Two practice pointers emerge.  First, the court noted that Porzig's attorneys adequately informed the arbitrators of the correct standard for the award and calculation of fees.  Had they not, they may not have won.  Lawyers who represent plaintiffs in fee shifting cases should make a record that they have informed the arbitrator of the correct standard for the award of fees.

Second, defense counsel made several erroneous arguments to the arbitrators, including a manifestly incorrect position on the very issue on which the arbitrators acted in manifest disregard of the law.  Thus, the arbitrators may have been led down the primrose path by defense counsel.  Whether this was intentional or the result of a good faith mistake does not appear from the opinion.  Defense lawyers in future arbitrations should be certain to make their arguments based upon a correct statement of the law.  Failure to do so may render appealable an otherwise bulletproof defense award.  And there is always the possibility of an ethics charge arising from an intentional misstatement of the law to a tribunal.

Whatever the Supreme Court eventually decides, it will have little effect in New Jersey.  Experience tells us that most discrimination cases in New Jersey are filed under the NJ Law Against Discrimination --- commonly known as the LAD --- because its remedies usually are more favorable to plaintiffs and it does not have a requirement that plaintiffs first file with an administrative agency.  Thus, the LAD usually is a better choice for plaintiffs than similar federal statutes.

This case follows closely the settlement of another case making same kinds of claims for about $5.5 million. 

Sprint-Nextel denied any wrongdoing, saying that it wanted to put the matter behind it so it could continue with business. 

"[A]ge-bias litigation is a scenario being repeated across the country as companies' streamlining efforts take a toll on baby boomers whose salaries make them targets for layoffs.  "We're seeing a ton of it," [an EEOC senior trial attorney] said."

Employment lawyers tend to agree that age discrimination cases are a bottom-up phenomenon.  Companies generally try to be fair and set appropriate policies.  Lower-level managers who implement those policies are the ones who usually create discrimination problems.

Here's a common scenario:

"[T]the bulk of age-discrimination complaints are brought by a sole plaintiff. These plaintiffs tend to have several things in common: They've worked for one employer for many years, have been stellar performers and were fired after new managers had taken over. 

"What we see over and over again is a new boss comes in and the new boss wants to reorganize and change things," said [one attorney]. "The new boss makes life miserable for the long-term, exceptional employees, and soon some or all of them begin to receive unfair scrutiny and eventually are fired, moved out or demoted."

 Demographics suggest that this trend will not change soon.  And, as the article points out, retaliation claims will probably follow the surge in pure age discrimination claims.

Over time a few ex-employees have been able to convince courts to void their releases, which allowed them to sue their ex-employers despite seeming to have signed away their rights.

The linked decision of the federal District of Minnesota in Pagliolo v. Guidant Corporation is a virtual road map to attacking a release under the OWBPA.  The opinion is methodical, and there's a lot to be learned here for both ex-employees and downsizing employers (and their attorneys).  

All professional practices with a mandatory retirement policy need to keep an eye on this. 

For forward thinking lawyers the case may present an opportunity.  If the mandatory retirement policy is upheld, there may be some top-notch legal talent looking for places to continue their practices into their 70's.  Many small and mid-size firms would welcome them with open arms.