Roundup: 3rd, 6th, 10th and 11th Circuits

No future injury means no injunctive relief; Test clarified in hostile work environment case; Medical condition justified termination; Arbitration clause enforceable for bank overdraft fee disputes

3rd Circuit: No future injury means no injunctive relief

The 3rd Circuit decided March 6 in McNair v. Synapse Group Inc. that plaintiffs must show that they are likely to suffer future injury from defendants’ conduct in order to receive injunctive relief.

Each of the plaintiffs in McNair had purchased a magazine subscription through consumer magazine distributor Synapse, which would automatically renew the subscriptions unless subscribers canceled them. The plaintiffs claimed Synapse tricked them into renewing their subscriptions by disguising automatic renewal notices as junk mail. The group filed a class action lawsuit against the company, seeking injunctive relief.

Synapse opposed the suit, arguing that the plaintiffs couldn’t seek injunctive relief because they wouldn’t suffer any future damages. A trial court declined to certify the class because of the plaintiffs’ individualized issues. On appeal, the 3rd Circuit concluded that the plaintiffs didn’t have standing to seek injunctive relief because they couldn’t prove that they would suffer future injuries from Synapse’s conduct.

6th Circuit: Test clarified in hostile work environment case 

The 6th Circuit recently clarified that an employee must be expressly aware of harassment directed at his co-workers in order to use their collective experiences in his individual case alleging that he works in a hostile work environment.

In Berryman v. SuperValu Holdings Inc., a group of current and former SuperValu warehouse employees sued their employer, claiming their workplace was rife with racist comments and pranks. A district court granted SuperValu’s motion for summary judgment, finding that the acts the plaintiffs described were disgraceful but didn’t constitute a hostile work environment.

On Feb. 24, the 6th Circuit affirmed the decision and also clarified the “totality of the circumstances” test, which courts use to weigh hostile work environment claims by considering the frequency of discriminatory acts, their severity, whether they are physically threatening or humiliating, and whether they interfere with job performance. The court explained that a plaintiff in a hostile work environment case must be aware of allegedly discriminatory acts directed at co-workers in order to use their evidence in his individual case. The Berryman plaintiffs didn’t demonstrate that they were “individually aware of the harassment experienced by other plaintiffs,” the court said.

10th Circuit: Medical condition justified termination

The 10th Circuit ruled Feb. 10 in DeGraw v. Exide Technologies that a company was justified in terminating a worker who it believed couldn’t do his job due to his medical condition.

Terry DeGraw, a material handler at Exide, had a history of nonwork-related back problems for which he occasionally took leave under the Family and Medical Leave Act (FMLA). One time, after returning to work, DeGraw complained that mandatory overtime work worsened his pain, and he took more FMLA leave. Exide told him not to return to work until he received medical approval. A few months later, DeGraw’s doctor cleared him to go back to work, but Exide’s own doctor refused to let DeGraw work due to his medical restrictions. Exide couldn’t find another position for DeGraw and terminated him.

DeGraw sued Exide, claiming the company retaliated against him for disclosing his aggravated back pain and for taking FMLA leave. A district court ruled in favor of Exide, saying the company was right in terminating DeGraw because it relied on its doctor’s opinion that he couldn’t safely perform his job. The 10th Circuit affirmed the decision, saying DeGraw had exhausted his FMLA leave and Exide “honestly believed” DeGraw couldn’t safely do his job.

11th Circuit: Arbitration clause enforceable for bank overdraft fee disputes

The 11th Circuit ruled March 1 in Buffington et al. v. SunTrust Banks Inc. that a bank can force its account holders to arbitrate overdraft fee disputes.

In 2009, two SunTrust account holders filed a class action lawsuit against the bank, claiming it charged them excessive overdraft fees. SunTrust argued that a clause in the plaintiffs’ contracts required them to resolve their disputes individually through arbitration. The clause also required customers to pay SunTrust’s legal fees if the company wins in arbitration.

In 2010, a district court denied SunTrust’s motion to compel arbitration, finding the arbitration clause to be unreasonable because it contained a class action waiver. But in September 2011, the 11th Circuit vacated the ruling and remanded it in light of the Supreme Court’s April 2011 decision in AT&T Mobility v. Concepcion, which found arbitration clauses to be enforceable.

The district court again denied SunTrust’s motion to compel arbitration, this time finding that the bank’s arbitration policy was unfair because it placed a higher risk on the plaintiffs. But the 11th Circuit reversed and remanded, saying that inequality in bargaining power doesn’t invalidate an arbitration agreement.

Ashley Post

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