Mary Siceloff, Author at Weintraub Tobin

WATCH OUT! SUPREME COURT OPENS DOOR TO TREBLE DAMAGES IN PATENT CASES!

Published: June 30, 2016

by Audrey A. Millemann
The IP Law Blog

Up until now, it has been nearly impossible for a plaintiff to recover enhanced (up to treble) damages in patent infringement cases. The current test for enhanced damages, set forth by the Federal Circuit Court of Appeals in 2007 in In Re Seagate Technology, LLC, 497 F.3d 1360 (2007), was so rigid that it essentially slammed the door on plaintiffs seeking enhanced damages. On June 13, 2016, however, the Supreme Court decision changed all that, in a unanimous decision in Halo Electronics v. Pulse Electronics, 2016 U.S. LEXIS 3776 (June 13, 2016). The Court opened the door for plaintiffs to recover enhanced damages – no one is sure yet how far – but it is clear that plaintiffs have been given a boost and would-be infringers a cause for anxiety.

In Halo, the Court made three rulings that affect patent infringement suits. First, the Court changed the test for recovery of enhanced damages from a rigid test to a flexible one. Second, the Court lowered the plaintiff’s burden of proof for enhanced damages. Third, the Court eased the standard of appellate review of district courts’ decisions on enhanced damages, leaving the district courts with more discretion and making it more difficult for defendants to overturn awards of enhanced damages.

The patent laws permit a trial court, in its discretion, to award enhanced damages to a plaintiff who prevails in a patent infringement suit. 35 U.S.C. § 284. In Seagate, the Federal Circuit held that in order to obtain enhanced damages under § 284, a plaintiff had to prove willful infringement. The court established a two-part test for willfulness. The first part is objective – the plaintiff must show that there was an objectively high likelihood that the defendant’s actions were infringing. This part of the test, referred to as “objective recklessness,” is determined by the judge based on the record, and cannot be found if the defendant raises a substantial question during the litigation as to noninfringement or invalidity. The second part of the Seagate test is subjective – the plaintiff must show that the defendant knew or should have known that its actions were risking infringement. The Seagate court held that a plaintiff must prove both parts of the test by clear and convincing evidence. In Seagate, the court also established three different standards for appellate review: de novo for objective recklessness, substantial evidence for subjective knowledge, and abuse of discretion for the decision to award enhanced damages.

The Supreme Court’s Halo decision is a single decision issued in two cases: Halo Electronics v. Pulse Electronics and Stryker Corp v. Zimmer, Inc. In the Halo case, plaintiff Halo and defendant Pulse competed in electronic components. Halo owned patents for electronic packages with transformers used to attach to circuit boards. Halo offered Pulse the opportunity to license the patents. Pulse declined and continued to sell the accused products, after deciding that the patents were not valid. Halo sued Pulse. The jury found that Pulse had infringed the patents and that the infringement was likely willful. Halo sought enhanced damages, but the district court denied the request on the grounds that Pulse had asserted a defense at trial that was not baseless, such that the first part of the Seagate test could not be met. On appeal, the Federal Circuit affirmed.

In Stryker, Stryker and Zimmer competed in the sale of an orthopedic surgical device. Stryker sued Zimmer for patent infringement, and won a jury verdict of $70 million for willful infringement. The willfulness was based on evidence that Zimmer had flagrantly decided to copy Stryker’s products. The district court awarded an additional $6.1 million in damages and trebled the award, for a total of over $228 million. On appeal, the Federal Circuit affirmed the finding of infringement, but reversed the award of treble damages, relying on the same rationale as in the Halo case, that the defendant had presented reasonable defenses at trial, such that the first part of the Seagate test could not be met.

The Supreme Court explained that § 284 provides a district court with discretion to award enhanced damages and does not specifically limit that discretion. Halo, at *14. However, the Court emphasized that the district court’s discretion should only be exercised in “egregious” cases. Id. at *15. Egregious cases are those in which the defendant’s conduct is “wanton, malicious, bad-faith, deliberate, consciously wrongful, flagrant, or . . . characteristic of a pirate.” Id.

In tossing out the Seagate test, the Court said that the first part of the Seagate test – objective recklessness – is wrong because it excludes defendants who wantonly infringe a patent, but later, during litigation, assert a defense that they may not even have known existed at the time of the infringement. Id. at *16-17. According to the Court, “someone who plunders a patent – infringing it without any reason to suppose his conduct is arguably defensible – can nevertheless escape any comeuppance under §284 solely on the strength of his attorney’s ingenuity.” Id. at *17. The Court found no basis under §284 for a threshold requirement of objective recklessness, holding that a defendant’s culpability should be “measured against the knowledge of the actor at the time of the challenged conduct.” Id. The Court further found that the high burden of proof of clear and convincing evidence was inappropriate and not consistent with § 284. Id. at *20.

The Court set forth the proper test for enhanced damages, at *19:

“[C]ourts should continue to take into account the particular circumstances of each case in deciding whether to award damages, and in what amount. Section 284 permits district courts to exercise their discretion in a manner free from the inelastic constraints of the Seagate test. Consistent with nearly two centuries of enhanced damages under patent law, however, such punishment should generally be reserved for egregious cases typified by willful misconduct.”

Thus, in discarding the Seagate test, the Court did not replace it with a new test. Instead, the Court simply held that the Seagate test is “unduly confining” and that district courts should “be guided by sound legal principles developed over nearly two centuries of application and interpretation of the Patent Act . . . [and limit] the award of enhanced damages to egregious cases of misconduct beyond typical infringement.” Id. at *24.

Lastly, the Court changed the standard of review of a district court’s decision on enhanced damages. The Court held that because the district court has full discretion to award enhanced damages, its discretion should be subject to a single standard of review, abuse of discretion.

Halo has significant ramifications for patent owners and potential infringers, and for patent litigation itself. Among them are:

Because the test is now more flexible and because the plaintiff’s burden of proof is lower, there may be more patent infringement cases filed.
Because the accused infringer may face allegations of willfulness that will likely survive to trial, cease and desist letters from patent owners to accused infringers may carry more weight.
Because the test is now determined by the defendant’s conduct at the time of the infringing acts, plaintiffs may conduct more extensive discovery into the defendant’s knowledge and when the defendant had that knowledge.
Without the benefit of the objective recklessness part of the Seagate test, defendants will have a more difficult time obtaining summary judgment of no willfulness; thus, the issue of willfulness and the plaintiff’s supporting evidence of the defendants willfulness will be presented at trial.
Because defendants will not want to risk evidence of willfulness at trial and an award of enhanced damages, settlement discussions will become more important, and more cases may settle before trial.
Because the “new” test is more flexible and because the burden of proof on the plaintiff is lower than under Seagate, plaintiffs may be more likely to recover enhanced damages at trial.
Because the test is now determined by the defendant’s conduct at the time of the infringing acts, companies developing new technology may become more diligent in conducting early infringement and invalidity analyses of key patents in their industry.
For the same reason, defendants may become more cautious in how they conduct themselves during the development of new technology, and in the written records of their conduct.

While most view Halo as very favorable to patent owners, its effect will not be known until the district courts start applying the test and the Federal Circuit rules on their decisions. Until that time, potential infringers may not really know what type of conduct will result in enhanced damages, and should act accordingly.

Congratulations to Darrell White!

Published: June 24, 2016

Congratulations to Darrell White for receiving both the City of Santa Ana Beautiful Yard Award and Neighborhood Hero Award! The awards were presented at Bower’s Museum on Thursday, June 23, 2016, and included recognition from the City Council of Santa Ana, Rep. Lorretta Sanchez (46^th Dist.), Sen. Janet Nguyen (34^th Dist.), Asmbly. Tom Daly (69^th Dist.), Diane L. Harkey (State Board of Eq.), and Supervisor Andrew Do (1^st Dist., Orange County).

Seventh Circuit Finds Class Action Waivers Unlawful

Published: June 24, 2016

by Daniel C. Zamora
The Labor & Employment Law Blog

On May 26, 2016, the U.S. Court of Appeals for the Seventh Circuit in Lewis v. Epic Systems Corporation, held that when an employer conditions continued employment upon the signing of a class or collective action waiver in an arbitration agreement, the agreement violates the National Labor Relations Act (NLRA) and is unenforceable under the Federal Arbitration Act (FAA). The decision creates a split with other circuit courts, including the Second, Fifth and Eighth circuits.

Employers in the Seventh Circuit will have to re-evaluate how to minimize the risk of class and collective action liability. The ruling arose out of an arbitration agreement seeking to prevent class and collective actions on wage and hour claims. Increasingly, employers are being hit with class and collective action wage and hour lawsuits trying to force settlements, despite having named plaintiffs who worked at one location and are often unfamiliar with the employer’s actual policies and practices on a class-wide basis. The Seventh Circuit’s decision makes it more difficult for employers to curb these abuses.

The employer in Lewis provided employees with an arbitration agreement via email that stated any wage and hour claims could only be brought through individual arbitration and that the employees waived the right to participate in, or receive money from, any class, collective or representative proceeding. The agreement further provided that employees were deemed to have accepted the terms of the arbitration agreement through their continued employment with the company, but also requested that employees acknowledge their receipt of the agreement.

Although the plaintiff in Lewis had acknowledged his receipt of the arbitration agreement, he later filed an action in federal court on behalf of himself and other similarly situated employees contending that the employer had misclassified employees and failed to pay overtime in violation of the Fair Labor Standards Act. The district court denied the employer’s motion to compel arbitration, finding that the arbitration clause violated the NLRA because it interfered with employee’s rights to engage in concerted activities for mutual aid and protection.

In affirming the district court’s denial of the motion to compel arbitration, the Seventh Circuit first determined that the employer’s arbitration provision violated Section 7 of the NLRA, providing that “[e]mployees shall have the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid and protection.” Although not specifically including class and collective actions, the Seventh Circuit interpreted “concerted activities” to include such proceedings, reasoning that “[g]iven Section 7’s intentionally broad sweep, there is no reason to think that Congress meant to exclude collective remedies from its compass.” In support of its ruling, the Court relied on the much-criticized National Labor Relations Board’s decision in D.R. Horton, holding that arbitration agreements prohibiting class or collective actions violate Sections 7 and 8 of the NLRA.

In finding that the employer’s arbitration violated the NLRA, the Seventh Circuit made a significant distinction worth considering for employers. The Seventh Circuit specifically distinguished rulings from other circuits, including the Ninth Circuit, finding that provisions mandating individual arbitration may be enforceable, where the employees had the right to opt out of the agreement without penalty. However, because the agreement specifically provided that the employees were “deemed” to have consented to the agreement by continuing with their employment, the court avoided addressing whether an agreement with an opt out provision would be enforceable.

The Seventh Circuit also independently held that the arbitration agreement was unenforceable under the FAA. In doing so, the Seventh Circuit noted that it was creating a split among circuit courts, on whether the FAA mandates enforcement of individual arbitration provisions over any conflict with the NLRA.

The Seventh Circuit found no conflict with the FAA as the NLRA generally favors arbitration and a violation of Section 7 would not have occurred if the arbitration agreement had permitted class or collective arbitration. The Court also relied on the FAA’s savings clause in finding no conflict. While the FAA generally favors arbitration, its saving clause provides that arbitration agreements are “enforceable save upon such grounds as exist at law or in equity for the revocation of any contract.” The Seventh Circuit reasoned that because the arbitration provision violated the NLRA, that illegality rendered it unenforceable under the savings clause.

Notably, the Fifth Circuit, in D.R. Horton, Inc. v. NLRB, has previously rejected the claim that the FAA savings clause could be used to invalidate a class action waiver, as it results in disfavoring arbitration, by eliminating its streamlined convenience and cost savings. The Fifth Circuit also rejected the argument that that NLRA was exempted from application of the FAA.

Takeaway for Employers:

It remains to be seen when the United States Supreme Court will address the split among circuits on whether class action waivers in arbitration agreement are enforceable under the FAA or violate the NLRA. However, employers in the Seventh Circuit should now review their arbitration agreements to see if they comply with Lewis. A class action waiver entered into as a condition of employment will be found invalid by district courts in that circuit.

However, it does not necessarily follow that all class arbitration waivers will be deemed to be per se invalid. The Seventh Circuit left open the question of whether a class action waiver in an arbitration agreement would comply with the NLRA if the employee were given the choice of opting out in connection with their continued employment.

EEOC Issues Proposed Guidance On National Origin Discrimination

Published: June 22, 2016

The Labor & Employment Law Blog

By: Vida L. Thomas

On June 2, 2016, the Equal Employment Opportunity Commission (“EEOC”) released a proposed guidance on national origin discrimination under Title VII, and is seeking public input. Title VII prohibits employment discrimination against applicants and employees because of their national origin, because they are from a particular country or part of the world, or because of actual or apparent ethnicity. The EEOC publishes guidance documents to explain its enforcement position to employers and employees, and to explain how the law pertains to specific workplace scenarios.

The agency last published guidance on this topic in 2002. Since that time, it has received a steady stream of national origin complaints. In fiscal year 2015, approximately 11 percent of the 89,385 private sector charges filed with EEOC alleged national origin discrimination. These charges alleged a wide variety of Title VII violations, including unlawful failure to hire, termination, language-related issues, and harassment. On top of that, the legal landscape in this area has evolved, including new developments in the areas of human trafficking, job segregation and intersectional discrimination. All of these factors led the EEOC to conclude that a revised guidance on national origin discrimination was necessary. The following are some of the key provisions of the proposed guidance.

Human Trafficking

The proposed guidance also points out that employers that use the labor of human trafficking victims may violate not only criminal laws, but Title VII as well. Employers may subject these workers to harassment, job segregation, unequal pay, or unreasonable paycheck deductions, all of which are discriminatory if motivated by the workers’ national origin or ethnicity. Also, because victims of human trafficking are engaging in compelled labor, the work environment may reasonably be perceived as hostile, leading to liability for unlawful harassment.

Customer Preferences

The proposed guidance also provides that employers may not rely on the discriminatory customer preferences of coworkers, customers, or clients to justify discriminatory employment practices. Employers who demand that their workers have a specific “corporate look” or “all-American image” are cautioned that these standards cannot serve as a proxy for discriminatory customer preference or prejudice. So, for example, an employer cannot refuse to hire an Arab American individual because it believes the individual looks “foreign,” and fears negative customer perceptions. Similarly, an employer may not force all Filipino employees into jobs away from the public because of an actual or assumed customer preference for non-Filipino employees.

English-Only Rules

The EEOC cautions that while employers may have legitimate reasons for basing employment decisions on linguistic characteristics, because linguistic characteristics are closely associated with national origin, employers should tread carefully in this area. The proposed guidance explains that Title VII also may restrict employment decisions that are based on accent and English fluency. It explains that an employment decision may legitimately be based on an individual’s accent if the accent “interferes materially with job performance.” An English fluency will be permissible under Title VII only if it is necessary for the effective performance of the position.

Citizenship

Title VII applies regardless of an individual’s immigration status, and regardless of whether the individual is legally authorized to work in the United States. Generally speaking, refusing to hire someone merely because he or she is not a U.S. citizen constitutes unlawful national origin discrimination under Title VII. However, the proposed guidance recognizes that employers are permitted to ensure that they do not hire individuals who are not authorized to work in the U.S. Moreover, when U.S. citizenship is required by federal law, it is not a violation of Title VII to refuse to hire an individual because he or she is not a U.S. citizen.

Other Issues

The proposed guidance addresses the types of adverse action that could support a claim of retaliation. It also discusses Title VII’s application to foreign employers and American employers in foreign countries. To better assist employers, it contains examples of “promising practices” employers can adopt to reduce risk in the areas of recruitment; hiring, promotion and assignment; discipline, demotion, and discharge; and harassment.

The 30-day input period ends on July 1, 2016. You can find the draft guidance at https://www.regulations.gov/#!documentDetail;D=EEOC-2016-0004-0001 After considering the public input it receives, the EEOC will publish a final guidance, which will replace the existing EEOC Compliance Manual, Volume II, Section 13: National Origin Discrimination.

The Supreme Court Rules the PTAB and District Courts Can Continue to Apply Different Standards for Interpreting Patent Claims

Published: June 21, 2016

by Jo Dale Carothers, Ph.D.
The IP Law Blog

Patent litigators and prosecutors have been waiting to hear whether the U.S. Supreme Court would require the United States Patent and Trademark Office (“USPTO”) to apply the same claim construction standard as the district courts. The answer is “No.”

For over 100 years, the USPTO has used the “broadest reasonable construction” standard to interpret patent claims. But the district courts apply a different standard, which gives claims their ordinary meaning as understood by a person of skill in the art. Questions have arisen as to whether it makes sense for these standards to be different. In its ruling on June 20, 2016, the U.S. Supreme Court addressed this question as it relates to an inter partes review (“IPR”), which is a procedure created by the America Invents Act, 35 U.S.C. §100 et seq. The IPR procedure allows someone other than the patent owner to petition the USPTO to review claims of an issued patent and cancel claims that are found to be unpatentable in light of prior art. The Patent Trial and Appeal Board (“PTAB”) handles IPR petitions and reviews at the USPTO.

In 2012, Garmin International, Inc., and Garmin USA, Inc., filed an IPR petition seeking to invalidate the claims of Cuozzo Speed Technologies, LLC’s patent relating to speedometers that alert drivers when they exceed the speed limit. Among other requests, Garmin asked the USPTO to review claim 17 in light of three prior art patents. Claim 17 depended from claims 10 and 14. While Garmin had not expressly challenged claims 10 and 14, the USPTO granted the petition as to all three claims explaining that claims 10 and 14 were implicitly challenged. The PTAB concluded that these claims were obvious in light of the prior art, denied Cuozzo’s motion to amend the claims as futile, and cancelled the claims. Cuozzo appealed to the Court of Appeals for the Federal Circuit arguing 1) the PTAB improperly applied the “broadest reasonable construction” standard instead of the district courts’ standard, and 2) the USPTO improperly instituted review of claims 10 and 14 because Garmin had not challenged those claims “with particularity.” The Federal Circuit rejected both arguments. The Supreme Court granted certiorari and affirmed. The Court found that the USPTO has the authority to issue a reasonable rule specifying the standard for claim construction and that the broadest reasonable construction standard is a reasonable rule. Further, the Court found that 35 U.S.C. §314(d) precludes appeal of the USPTO’s decision to institute review of claims 10 and 14.

In considering the claim construction standard, the Court considered Cuozzo’s argument that the USPTO did not have the authority to issue a regulation instructing that in inter partes review, the PTAB “shall [construe a patent claim according to] its broadest reasonable construction in light of the specification of the patent in which it appears” 37 CFR §42.100(b)(2015). Cuozzo argued that the PTAB should be required to apply the same claim construction standard used by the district courts. The Supreme Court, however, disagreed citing §316(a)(4) of the statute, which grants the USPTO authority to issue “regulations … establishing and governing inter partes review.” The Court explained that the statute contains a gap because it does not unambiguously tell the USPTO what claim construction standard to use. Where a statute is ambiguous or leaves a gap, the Court pointed out that it typically interprets the statute “as giving the agency leeway to enact rules that are reasonable in light of the text, nature, and purpose of the statute.”

The Court was not persuaded by Cuozzo’s argument that Congress must have designed IPR proceedings as a “surrogate for court proceedings,” and thus must have intended the USPTO to use the same standard as the district courts. The Court reasoned that in other ways IPR proceedings are more like a specialized agency proceeding than a judicial proceeding. For example, parties initiating the proceedings do not have to have a stake in the outcome, petitioners may lack constitutional standing and need not remain in the proceeding, and the Patent Office may intervene in a later judicial proceeding to defend its decision. In addition, the burden of proof to cancel claims in an IPR is preponderance of the evidence, whereas in district court, a challenger must prove invalidity by clear and convincing evidence, which is a higher standard. Further, “neither the statutory language, its purpose, or its history suggest that Congress considered what standard the [USPTO] should apply … in inter partes review.” Therefore, the Court found that the USPTO has the authority to enact reasonable rules specifying the claim construction standard to fill this gap in the statute.

The Court then turned to the question of whether the rule is a reasonable exercise of that authority. The Court noted that “the broadest reasonable construction helps to protect the public.” It encourages patent applicants to draft claims narrowly, which promotes “precision while avoiding overly broad claims” and “helps prevent a patent from tying up too much knowledge” while helping the public “draw useful information from the disclosed invention and better understand the lawful limits of the claim.” The Court also noted that past practice at the USPTO supports use of the broadest reasonable construction.

Cuozzo argued that there is a critical difference between the initial examination of a patent and the examination during an IPR that supports use of the district courts’ standard. In an initial examination, the examiner applies the broadest reasonable construction, and if claims are rejected, the applicant can amend them as a matter of right. In contrast, there is no absolute right to amend claims during an IPR. Instead, amendment requires a motion, which has rarely been granted. But the Court did not find this argument persuasive. Instead, the Court found that use of the broadest reasonable construction was not unfair in any obvious way because there is an opportunity to amend during an IPR, albeit rarely granted, and the “original application process may have presented several additional opportunities to amend” the patent claims.

Cuozzo also argued that the use of one standard in IPR proceedings before the PTAB and a different standard in district courts “may produce inconsistent results and cause added confusion.” A district court could find a patent claim valid, and then the USPTO could later cancel the claim in its review. The Court noted that that possibility “has long been present in our patent system, which provides different tracks … for the review and adjudication of patent claims.” Given that inter partes review imposes a different burden of proof than that of the district courts, “the possibility of inconsistent results is inherent to Congress’ regulatory design.” Further, the USPTO uses the broadest reasonable construction in other proceedings, which may be consolidated with inter partes review. Thus, the Court could not find it unreasonable that the patent office prefers “a degree of inconsistency between the courts and the [USPTO] rather than among [USPTO] proceedings.”

Therefore, according to the Supreme Court, the PTAB and district courts can continue to apply different standards for interpreting patent claims. Thus, when seeking to invalidate claims, patent challengers will likely continue to favor IPRs because of the broadest reasonable construction standard and the lower burden of proof.

The EEOC Special Task Force Issues Its Report on the Study of Harassment in the Workplace and Finds that “We Have Come Far But Still Have Far To Go”

Published: June 20, 2016

The Labor & Employment Law Blog

The EEOC Special Task Force (“Task Force”) has spent the last 18 months examining the myriad and complex issues associated with harassment in the workplace. Thirty years after the U.S. Supreme Court held in the landmark case of Meritor Savings Bank v. Vinson that workplace harassment was an actionable form of discrimination prohibited by Title VII of the Civil Rights Act of 1964, the Task Force concludes that “we have come a far way since that day, but sadly and too often still have far to go.”

The Task Force was comprised of 16 members from around the country, including representatives of academia from various social science disciplines; legal practitioners on both the plaintiff and defense side; employers and employee advocacy groups; and organized labor. The Task Force reflected a broad diversity of experience, expertise, and opinion. From April 2015 through June 2016, the Task Force held a series of meetings – some were open to the public, some were closed working sessions, and others were a combination of both. In the course of a year, the Task Force received testimony from more than 30 witnesses, and received numerous public comments. The Task Force focused on learning everything about workplace harassment – from sociologists, industrial-organizational psychologists, investigators, trainers, lawyers, employers, advocates, and anyone else who had some useful information.

Below is a summary of the Task Force’s key findings.

Workplace Harassment Remains a Persistent Problem. Almost fully one third of the approximately 90,000 charges received by EEOC in fiscal year 2015 included an allegation of workplace harassment on the basis of sex (including sexual orientation, gender identity, and pregnancy), race, disability, age, ethnicity/national origin, color, and religion.
Workplace Harassment Too Often Goes Unreported. Common workplace-based responses by those who experience sex-based harassment are to avoid the harasser, deny or downplay the gravity of the situation, or attempt to ignore, forget, or endure the behavior. The Task Force found that roughly three out of four individuals who experienced harassment never even talked to a supervisor, manager, or union representative about the harassing conduct.
There Is a Compelling Business Case for Stopping and Preventing Harassment. When employers consider the costs of workplace harassment, they often focus on legal costs. In 2015 alone, the EEOC recovered $164.5 million for workers alleging harassment. However, beyond the cost to the company, workplace harassment affects all workers, and its true cost includes decreased productivity, increased turnover, and reputational harm.
It Starts at the Top – Leadership and Accountability Are Critical.Workplace culture has the greatest impact on whether harassment occurs or not. An organization must have systems in place (at all levels and across all positions) that holds employees accountable. Accountability systems must ensure that those who engage in harassment are held responsible in a meaningful, appropriate, and proportional manner, and that those whose job it is to prevent or respond to harassment should be rewarded for doing that job well.
Training Must Change. Much of the training done over the last 30 years has not worked as a prevention tool – it’s been too focused on simply avoiding legal liability. Training must be part of a holistic culture of non-harassment that starts at the top. Similarly, one size does not fit all: Training is most effective when tailored to the specific workforce and workplace, and to different cohorts of employees. Finally, when trained correctly, middle-managers and first-line supervisors in particular can be an employer’s most valuable resource in preventing and stopping harassment.
New and Different Approaches to Training Should Be Explored. The Task Force reviewed several new models of training that may show promise for harassment training. “Bystander intervention training” – increasingly used to combat sexual violence on school campuses – empowers co-workers and gives them the tools to intervene when they witness harassing behavior, and may show promise for harassment prevention. Workplace “civility training” that does not focus on eliminating unwelcome or offensive behavior based on characteristics protected under employment non-discrimination laws, but rather on promoting respect and civility in the workplace generally, likewise may offer solutions.
It’s On Us. The Task Force made clear that harassment in the workplace will not stop on its own – it’s on all of us to be part of the fight to stop workplace harassment. For this reason, the Task Force suggests exploring the launch of an “It’s On Us Campaign” for the workplace. Originally developed to reduce sexual violence in educational settings, the “It’s On Us Campaign” is premised on the idea that students, faculty, and campus staff should be empowered to be part of the solution to sexual assault, and should be provided the tools and resources to prevent sexual assault as engaged bystanders. According to the Task Force, while launching a similar campaign in workplaces across the nation – large and small, urban and rural – is an audacious goal, doing so could transform the problem of workplace harassment from being about targets, harassers, and legal compliance, into one in which co-workers, supervisors, clients, and customers all have roles to play in stopping such harassment.

The EEOC Task Force’s final report includes detailed recommendations and a number of helpful tools to aid in designing effective anti-harassment policies; developing training curricula; implementing complaint, reporting, and investigation procedures; creating an organizational culture in which harassment is not tolerated; ensuring employees are held accountable; and assessing and responding to workplace “risk factors” for harassment.

A full copy of the Report can be found at:
Select Task Force on the Study of Harassment in the Workplace

OFCCP Issues New Rule Regarding Sex Discrimination For Federal Contractors

Published: June 15, 2016

by Lizbeth (Beth) V. West
The Labor & Employment Law Blog

On June 14, 2016, the Office of Federal Contract Compliance Programs (OFCCP) announced publication of a Final Rule in the Federal Register that sets forth the requirements that covered contractors must meet under the provisions of Executive Order 11246 prohibiting sex discrimination in employment. This Final Rule updates sex discrimination guidelines from 1970 with new regulations that align with current law and address the realities of today’s workplaces. The Final Rule deals with a variety of sex–based barriers to equal employment and fair pay, including compensation discrimination, sexual harassment, hostile work environments, failure to provide workplace accommodations for pregnant workers, and gender identity and family caregiving discrimination.

The Final Rule addresses the following subjects:

Brings the sex discrimination guidelines up to date. The Final Rule aligns OFCCP’s regulations with current law and addresses the realities of today’s workplaces. It, therefore, provides more accurate and relevant guidance to contractors than the outdated guidelines.
Provides protections related to pregnancy, childbirth, and related medical conditions. The Final Rule protects employees against discriminatory treatment because of pregnancy, childbirth, or related medical conditions, including loss of jobs, wages, or health care coverage. The Final Rule requires that contractors provide workplace accommodations, such as extra bathroom breaks and light-duty assignments, to an employee who needs such accommodations because of pregnancy, childbirth, or related medical conditions, in certain circumstances where those contractors provide comparable accommodations to other workers, such as those with disabilities or occupational injuries.
Promotes fair pay practices. Contractors may not pay workers differently because of their sex. For instance, contractors may not deny opportunities for overtime work, training, better pay, or higher-paying positions because of a worker’s sex. The rule also includes a provision that enables employees to recover lost wages any time a contractor pays compensation that is the result of discrimination, not only when the decision to discriminate is made.
Provides equal benefits to male and female employees participating in fringe-benefit plans. The rule prohibits discrimination on the basis of sex with regard to fringe benefits such as medical, hospital, accident, life insurance, and retirement benefits; profit-sharing and bonus plans; leave; and other terms, conditions, and privileges of employment.
Prohibits sexual harassment. The rule prohibits unwelcome sexual advances, requests for sexual favors, offensive remarks about a person’s sex, and other verbal or physical conduct of a sexual nature when such conduct unreasonably interferes with an individual’s work performance, becomes the basis for employment decisions, or creates a hostile working environment.
Gives men and women equal access to jobs and workforce development opportunities. A contractor may not set requirements for jobs or training that are based on an applicant’s or employee’s sex unless the contractor can meet the high bar of demonstrating that such requirements are a bona fide occupational qualification. Additionally, a contractor may not set requirements, such as height or weight qualifications, that adversely affect applicants because of their sex unless it demonstrates that the qualifications are job-related and consistent with business necessity.
Safeguards workers who provide caregiving to their loved ones. Contractors may not treat female or male employees or applicants differently based on the stereotypical assumption that women are more likely to have caregiving responsibilities. For instance, contractors may not deny mothers employment opportunities that are available to fathers based on the faulty assumption that mothers’ childcare responsibilities will conflict with their job performance. Similarly, contractors may not deny fathers flexible workplace arrangements that are available to mothers based on the faulty assumption that men do not have and do not assume childcare responsibilities.
Protects transgender workers. The rule makes clear that sex discrimination includes discrimination because of an employee’s gender identity. Also, the rule requires contractors to allow workers to use bathrooms, changing rooms, showers, and similar facilities consistent with the gender with which the workers identify. In addition, the preamble to the rule notes that an explicit, categorical exclusion of coverage for all care related to gender dysphoria or gender transition is facially discriminatory because such exclusion singles out services and treatments for individuals on the basis of their gender identity or transgender status.
Prohibits discrimination based on sex stereotypes. Contractors may not treat employees or applicants adversely because they fail to comply with expectations about how women and men should look or act or what kinds of jobs they should do.
The Final Rule is consistent with the Religious Freedom Restoration Act and other protections for religiously affiliated contractors. While there is no formal process for invoking the Religious Freedom Restoration Act (“RFRA”) as a basis for an exemption from E.O. 11246, the preamble to the Final Rule states that insofar as the application of any requirement under this part would violate RFRA, such application shall not be required. OFCCP also notes that E.O. 11246 specifically allows religiously affiliated contractors (religious corporations, associations, educational institutions, or societies) to favor individuals of a particular religion when making employment decisions. In addition, OFCCP follows Supreme Court precedent recognizing that the First Amendment to the Constitution requires a “ministerial exception” from employment discrimination laws, which prohibits the government from interfering with the ability of a religious organization to make employment decisions about its “ministers.”

The Final Rule becomes effective on August 15, 2016. A copy of the Final Rule can be obtained at https://s3.amazonaws.com/public-inspection.federalregister.gov/2016-13806.pdf.

Take Away: All employers who are federal contractors (or subcontractors to a federal contractor) should review their EEO and Affirmative Action documents and work with their legal counsel to take the necessary steps to ensure they comply with the OFCCP’s Final Rule on Sex Discrimination by the August 15, 2016 effective date.

Congratulations to those from Weintraub Tobin named as Northern California Lifetime Achievement Recipients!

Published: June 13, 2016

Congratulations to the eight Weintraub Tobin attorneys selected to receive America’s Top 100 Attorneys, Northern California Lifetime Achievement Membership! Membership in America’s Top 100 Attorneys is limited to the top 100 attorneys from each state who best exhibit excellence and the highest ethical standards. With these high standards, less than 1% of attorneys in the United States will be selected for the membership. The Weintraub Tobin attorneys recognized for this distinction include:

Louis A. Gonzalez Jr.

Michael A. Kvarme

Charles L. Post

Lizbeth V. West

Pennsylvania’s New Medical Marijuana Law And The Workplace

Published: June 13, 2016

by Brendan J. Begley
The Labor & Employment Law Blog

Employers in Pennsylvania may or may not be enjoying high times as that state’s Medical Marijuana Act (“MMA”) went into effect on May 17, 2016. This new law allows patients to use marijuana to treat autism, cancer, HIV/AIDS, and post-traumatic stress disorder, among other ailments. Governor Tom Wolf signed the MMA into law on April 17, 2016, just three days before one of the most important dates on the calendar for marijuana enthusiasts.

The MMA does not allow all Pennsylvania citizens who feel under the weather to ingest marijuana however they like. On the contrary, the MMA allows medical marijuana to be dispensed only to individuals who both have been issued an identification card from the Pennsylvania Department of Health and obtained a certification from a medical provider. Nonetheless, Pennsylvania employers (like those in other states that have enacted similar laws) now will face some hazy dilemmas in terms of their drug-free workplace policies.

That is because the MMA contains some potent anti-discrimination provisions but also creates some cloudy ambiguities. For instance, the new law makes it illegal for an employer to refuse to hire, threaten, or discharge a prospective or current employee “solely on the basis of such employee’s status as an individual who is certified to use medical marijuana.” On the other hand, the MMA does not specify whether employers may rely upon a positive drug test to impose an adverse employment action.

Meanwhile, the MMA does not require employers to refrain from imposing discipline “when the employee’s conduct falls below the standard of care normally accepted for that position.” The MMA also allows employers to discipline an employee who is “under the influence” of medical marijuana at work, yet it does not clarify whether a positive drug test could be used as evidence of impairment on the job.

This new law gives some latitude to employers with safety-sensitive work environments. In particular, employers may prohibit employees from performing a number of tasks while under the influence of marijuana. Such tasks include operating or controlling certain chemicals or high-voltage electricity, performing duties in dangerous places, or performing tasks that may put the life of the employee or the lives of others in jeopardy. The law also states that employees in certain safety-sensitive positions may not have more than ten nanograms of active tetrahydrocannabis per milliliter of blood in serum.

Still, this list of exceptions could be interpreted as barring employers from restricting employees covered by the MMA in other common-sense ways. Another budding problem stems from the lack of clarity as to how employers can ascertain whether an employee is impaired by the influence of marijuana while on the job. Some observations may be helpful, but few appear to offer anything conclusive. For instance, an employee who reeks of marijuana smoke might be subject to discipline. That is because smoking marijuana in Pennsylvania will remain illegal; the MMA allows marijuana to be ingested only through alternative delivery systems such as pills or ointments.

Other observations might be helpful, such as the tell-tale red or glassy eyes or some level of confusion or distraction on the part of the employee. But such circumstances may not conclusively identify the presence or cause of impairment. And while blood-alcohol tests may be helpful in confirming how inebriated a worker is at the time of the test, drug tests for marijuana are not so precise in measuring the individual’s level of impairment at the time of the test.

For example, urine testing may reveal that the employee used marijuana at some point in the weeks prior to the test, but such tests typically cannot pinpoint whether such use occurred on a specific day. Similarly, saliva testing may be able to detect more recent use – albeit without providing a absolute confirmation as to whether the employee was under the “influence of marijuana” on the job.

Beyond the ambiguities created by the MMA, its very enforceability may be subject to challenge – since it appears to be in direct conflict with federal laws that illegalize the use of marijuana. Until the tension between federal law and Pennsylvania law is resolved by the courts, employers in the Keystone State should take some steps to keep their worksites from going up in smoke.

The first step would be to review and, if necessary, revise applicable handbooks and employment policies to make sure that they are compliant with both federal and Pennsylvania law. At the same time, employers should consider reviewing their job descriptions for safety-sensitive positions. Likewise, it would be advisable for employers to determine how positive marijuana tests will be handled. In that regard, when an employee tests positive for marijuana, it might be wise to have appropriate managers designated and trained to communicate with the employee to ascertain whether he or she has the necessary documentation to be covered by the MMA. Of course, it also would be prudent to consult with legal counsel to ensure that workplace policies and contemplated disciplinary actions do not run afoul of this new law.

Vida Thomas Mentioned in Comstock’s Magazine Article, The Macro Problems Caused by Microaggression

Published: June 8, 2016

Weintraub Tobin’s own Vida Thomas was recently mentioned in an article by Comstock’s Magazine. The article, titled “The Macro Problems Caused by Microaggression“ by Steven Yoder, deals with the implications of bias in the workplace. To read the full article, click here.

Vida serves as Of Counsel to the Firm’s Labor and Employment Group. As an AV-rated attorney who has practiced employment law for over 20 years, she heads up the Firm’s workplace investigations unit.

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