Roundup: 3rd, 11th, D.C. and Federal Circuits

Supreme Court's employee test has broader reach; Court strikes down Florida's anti-business-with-Cuba law; NLRB's posting requirement infringes on employers' free speech; Bayer's patent on birth control pill Yaz is invalid

3rd Circuit
Delaware, New Jersey, Pennsylvania

Supreme Court’s employee test has broader reach

In a precedential decision on April 29, the 3rd Circuit broadened the reach of the test to determine if an individual is an employee that the Supreme Court laid out in Clackamas Gastroenterology Associates v. Wells. That decision applied to cases brought under the Americans with Disabilities Act (ADA), but in Robert Mariotti v. Mariotti Building Products, the 3rd Circuit said the test also applies in the context of Title VII of the Civil Rights Act of 1964.

Robert Mariotti was a director, shareholder and employee of Mariotti Building Products, a family business. After his “religious awakening” caused strain among the family members, he was fired. He sued the company over religious discrimination and a hostile work environment, and the district court dismissed his complaint, saying he was not an employee.

Using the Clackamas test to determine whether a shareholder-director of a company counts as an employee in ADA contexts, the 3rd Circuit affirmed the district court’s ruling, saying the Clackamas test applies in Title VII cases such as Mariotti’s.

 

11th Circuit
Alabama, Florida, Georgia

Court strikes down Florida’s anti-business-with-Cuba law

On May 6, in Odebrecht Construction Inc. v. Secretary, Florida Department of Transportation, the 11th Circuit upheld a district court’s granting of a preliminary injunction against a Florida law that prohibits companies that do business with Cuba from bidding for state or local public contracts.

Florida passed the law, known as the Cuba Amendment, in 2012. Since its inception in 1990, Odebrecht had successfully bid on many public contracts in Florida. Although Odebrecht itself doesn’t do business in Cuba, some of the foreign subsidiaries of its parent company do. About a month before the amendment was set to take effect on July 1, 2012, Odebrecht filed a complaint. The district court found that Odebrecht would have suffered irreparable harm without the injunction, and that it seemed likely to succeed in its arguments that the Cuba Amendment is unconstitutional. The 11th Circuit affirmed.

“The amendment reaches far beyond the federal law in numerous ways and undermines the president’s exercise of the discretion afforded him by Congress to direct our nation’s economic policy towards Cuba,” the court wrote.

 

D.C. Circuit

NLRB’s posting requirement infringes on employers’ free speech

The D.C. Circuit dealt a blow to the National Labor Relations Board’s (NLRB) much-fretted-over posting requirement on May 7 in National Association of Manufacturers v. NLRB.

The rule would have required employers to post notices in the workplace informing employees of their rights under the National Labor Relations Act. Days after the NLRB mandated the postings in 2011, businesses sued, claiming the requirement violated corporate speech rights.

The court agreed, unanimously finding that this requirement was unconstitutional and infringed on employers’ right to free speech. The right to freedom of speech “necessarily protects … the right of employers (and unions) not to speak,” the court wrote. Therefore, employers have the right not to post the notices.

 

Federal Circuit

Bayer’s patent on birth control pill Yaz is invalid

In two cases against pharmaceutical giant Bayer AG, Bayer Healthcare Pharmaceuticals, Inc. v. Watson Pharmaceuticals Inc. and Sandoz Inc. and Bayer Schering Pharma AG v. Watson Pharma and Lupin, Ltd., generic drug companies argued that Bayer’s patent on the birth control pill Yaz was invalid because the company’s claims were obvious. 

A district court in Nevada ruled that the patent was valid, but plaintiffs argued that the lower court overlooked prior art in reaching that decision. On April 16, the Federal Circuit reversed that lower court’s ruling.

“The cited prior art references set forth every limitation required by the asserted claims and provide express motivation to combine those teachings to derive the claimed [oral contraceptive] products,” the court wrote.

Bayer’s patent was set to expire on June 30, 2014, but now several competitors, including Watson Pharmaceuticals Inc., now known as Actavis Inc., and Sandoz Inc. will sell generic versions of Yaz.

Contributing Author

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