National Litigation Hotline

Boss contended that because the Sarbanes-Oxley Act conferred jurisdiction on federal courts to hear whistleblowers' claims, it followed that such claims were not to be arbitrated. The court noted that in Oldroyd v. Elmira Savings Bank, 134 F.3d 72 (2d Cir. 1998), the Second Circuit had rejected an identical argument with regard to a claim brought under the Financial Institutions Reform, Recovery, and Enforcement Act (FIRREA). (The court also observed that similar arguments had been made ' and rejected ' with regard to the Age Discrimination in Employment Act of 1967, ERISA, and the Sherman Antitrust Act.)

Citing Oldroyd, the court acknowledged that Congress may over-ride the presumption in favor of arbitration if it manifests its intent to do so in the text of the statute, its legislative history, or an inherent conflict between arbitration and the statute's underlying purpose. However, the court determined that there was nothing in the text of the Sarbanes-Oxley Act or its legislative history demonstrating Congress' intent to pre-empt arbitration of claims under the statute, nor was there an inherent conflict between arbitration and the statute's purposes. Consequently, it held that Boss' claim were arbitrable, and granted Salomon's motion to stay the litigation and compel arbitration.

No Duty to Reinstate Employee When Position Has Been Eliminated

The Tenth Circuit has held that an employer was not obligated under the ADA to reinstate an employee whose position had been eliminated while he was on indefinite disability leave. Crano v. Graphic Packaging Corp., 2003 WL 21290912 (10^th Cir. June 5, 2003).

Plaintiff Crano was a packer inspector for Graphic Packaging Corp. (GPC) for over 10 years. In July 1996, he went on indefinite medical leave for treatment of liver disease, during which time GPC decided to eliminate the packer inspector position. Crano sought to return to work in the spring and summer of 1998, during which time he made formal accommodation requests for reinstatement as a packer inspector (initially with a 4-hour work day, and gradually increasing), and also for assignment to any other position for which he was qualified. GPC responded by informing Crano that the packer inspector position had been eliminated, that he was no longer a current employee under GPC's continuous service and leave policies, and that he would have to apply for open positions on the same basis as any other non-employee applicant. Consequently, Crano brought suit claiming, inter alia, that GPC unreasonably failed to accommodate his disability. The district court granted GPC's motion for summary judgment.

The Tenth Circuit affirmed, citing two of the district court's rationales. The court first held that GPC had no duty to reinstate Crano as a packer inspector after the position had been eliminated while he was on indefinite leave. The court noted that the ADA did not require GPC to create jobs or vacancies to accommodate Crano, nor did GPC's failure to make an exception to its leave policies (ie, preserve Crano's job for him until his return) constitute a failure to make a reasonable accommodation. Further, the Court also held that after Crano's status as a current employee expired, GPC was not required to reassign him to another job within the company. The Court noted that when GPC informed Crano that he could apply for open positions, coupled with GPC's disclaimer had no intention of discriminating against him. This action satisfied GPC's obligations under the ADA.

Employee's FLSA Claims Precluded By VPA

A federal district court recently held that the Volunteer Protection Act of 1997 (VPA) bars claims under the FLSA by a former employee against the board members of a youth center. Armendarez v. Glendale Youth Ctr Inc., 2003 WL 21241210 (D. Ariz. May 20, 2003).

Plaintiff Ana Armendarez was hired as the President and CEO of the Glendale Youth Center, Inc. (GYCI), an organization traditionally funded by grants. In early 1996, GYCI incurred serious debt. Armendarez decide to leave GYCI, but after getting the organization out of debt. However, in late 1996 and early 1997, Armendarez realized that GYCI would not be able to pay her a salary. GYC contended that Armendarez chose to stay without a salary to get the debts under control, but Armendarez believed that the board promised to pay her. Armendarez brought suit under the FLSA for her unpaid wages. GYCI asserted that the VPA precluded any claims under the FLSA.

The court agreed, and granted a motion to dismiss based upon the VPA. The VPA provides that volunteers of non-profit organizations or governmental entities cannot be held liable for acts on behalf of the organization in certain circumstances. Importantly, the VPA states that it 'preempts the laws of any State to the extent that such laws are inconsistent ' ' 42 U.S.C. ' 14502(a). The Court held that the text of '14502(a) cannot be interpreted to prevent the application of the VPA to federal law. Further, the legislative history of the VPA made no distinction between federal and state claims.

Moreover, the court noted that the VPA contains specific limitations on liability that includes both federal and state laws (eg, section 16 of Title 18). As Congress declined to list the FLSA as an exception, the court held that it could not imply that the FLSA was an exception to the VPA's limitations on liability.

The National Litigation Hotline was prepared by Jason S. Aschenbrand, an associate in the labor and employment department of Winston & Strawn's New York offices.

Plaintiff Crano was a packer inspector for Graphic Packaging Corp. (GPC) for over 10 years. In July 1996, he went on indefinite medical leave for treatment of liver disease, during which time GPC eliminated the packer inspector position. Crano sought to return to work in the spring and summer of 1998, during which time he made formal accommodation requests for reinstatement as a packer inspector (initially with a 4-hour work day, and gradually increasing), and also for assignment to any other position for which he was qualified. GPC responded by informing Crano that the packer inspector position had been eliminated, that he was no longer a current employee under GPC's continuous service and leave policies, and that he would have to apply for open positions on the same basis as any other non-employee applicant. Consequently, Crano brought suit claiming, inter alia, that GPC unreasonably failed to accommodate his disability. The district court granted GPC's motion for summary judgment.

The Tenth Circuit affirmed, citing two of the district court's rationales. The court first held that GPC had no duty to reinstate Crano as a packer inspector after the position had been eliminated while he was on indefinite leave. The court noted that the ADA did not require GPC to create jobs or vacancies to accommodate Crano, nor did GPC's failure to make an exception to its leave policies (ie, preserve Crano's job for him until his return) constitute a failure to make a reasonable accommodation. Further, the Court also held that after Crano's status as a current employee expired, GPC was not required to reassign him to another job within the company. The Court noted that when GPC informed Crano that he could apply for open positions, coupled with GPC's disclaimer had no intention of discriminating against him. This action satisfied GPC's obligations under the ADA.A federal district court recently held that the Volunteer Protection Act of 1997 (VPA) bars claims under the FLSA by a former employee against the board members of a youth center. Armendarez v. Glendale Youth Ctr Inc., 2003 WL 21241210 (D. Ariz. May 20, 2003).

Plaintiff Ana Armendarez was hired as the President and CEO of the Glendale Youth Center, Inc. (GYCI), an organization traditionally funded by grants. In early 1996, GYCI incurred serious debt. Armendarez decide to leave GYCI, but after getting the organization out of debt. However, in late 1996 and early 1997, Armendarez realized that GYCI would not be able to pay her a salary. GYC contended that Armendarez chose to stay without a salary to get the debts under control, but Armendarez believed that the board promised to pay her. Armendarez brought suit under the FLSA for her unpaid wages. GYCI asserted that the VPA precluded any claims under the FLSA.

The court agreed, and granted a motion to dismiss based upon the VPA. The VPA provides that volunteers of non-profit organizations or governmental entities cannot be held liable for acts on behalf of the organization in certain circumstances. Importantly, the VPA states that it 'preempts the laws of any State to the extent that such laws are inconsistent ' ' 42 U.S.C. ' 14502(a). The Court held that the text of '14502(a) cannot be interpreted to prevent the application of the VPA to federal law. Further, the legislative history of the VPA made no distinction between federal and state claims.

Moreover, the court noted that the VPA contains specific limitations on liability that includes both federal and state laws (eg, section 16 of Title 18). As Congress declined to list the FLSA as an exception, the court held that it could not imply that the FLSA was an exception to the VPA's limitations on liability.

The National Litigation Hotline was prepared by Jason S. Aschenbrand, an associate in the labor and employment department of Winston & Strawn's New York offices.

Sarbanes-Oxley Claims Not Exempt from Mandatory Arbitration

A federal district court in the Southern District of New York has recently held that claims brought under the Sarbanes-Oxley Act were not exempt from mandatory arbitration. Boss v. Salomon Smith Barney Inc., 2002 WL 21146653 (S.D.N.Y. May 16, 2003).

Plaintiff Kenneth Boss was employed by Salomon Smith Barney as a research analyst. Boss claimed that contrary to established rules, policies, and procedures, he was directed to share a draft research report with Salomon's investment bankers, and that he was pressured by Salomon to change his recommendations. Boss further alleged that when he failed to do so, Salomon retaliated by terminating his employment. Boss commenced a lawsuit seeking damages and reinstatement, to which Salomon responded by bringing a motion to stay the litigation and compel arbitration. In support of its motion, Salomon cited several internal documents (including its employee handbook), which stated that arbitration was the 'required and exclusive forum' for resolution of all employment disputes (including those brought under any federal, state or local statute, regulation, or common law doctrine regarding termination of employment). Salomon also referred to a U-4 application for registration with the NASD that Boss had executed, which called for arbitration of all disputes between Boss and Salomon.

Boss contended that because the Sarbanes-Oxley Act conferred jurisdiction on federal courts to hear whistleblowers' claims, it followed that such claims were not to be arbitrated. The court noted that in Oldroyd v. Elmira Savings Bank , 134 F.3d 72 (2d Cir. 1998), the Second Circuit had rejected an identical argument with regard to a claim brought under the Financial Institutions Reform, Recovery, and Enforcement Act (FIRREA). (The court also observed that similar arguments had been made ' and rejected ' with regard to the Age Discrimination in Employment Act of 1967, ERISA, and the Sherman Antitrust Act.)

Citing Oldroyd, the court acknowledged that Congress may over-ride the presumption in favor of arbitration if it manifests its intent to do so in the text of the statute, its legislative history, or an inherent conflict between arbitration and the statute's underlying purpose. However, the court determined that there was nothing in the text of the Sarbanes-Oxley Act or its legislative history demonstrating Congress' intent to pre-empt arbitration of claims under the statute, nor was there an inherent conflict between arbitration and the statute's purposes. Consequently, it held that Boss' claim were arbitrable, and granted Salomon's motion to stay the litigation and compel arbitration.

No Duty to Reinstate Employee When Position Has Been Eliminated

The Tenth Circuit has held that an employer was not obligated under the ADA to reinstate an employee whose position had been eliminated while he was on indefinite disability leave. Crano v. Graphic Packaging Corp., 2003 WL 21290912 (10^th Cir. June 5, 2003).

Plaintiff Crano was a packer inspector for Graphic Packaging Corp. (GPC) for over 10 years. In July 1996, he went on indefinite medical leave for treatment of liver disease, during which time GPC decided to eliminate the packer inspector position. Crano sought to return to work in the spring and summer of 1998, during which time he made formal accommodation requests for reinstatement as a packer inspector (initially with a 4-hour work day, and gradually increasing), and also for assignment to any other position for which he was qualified. GPC responded by informing Crano that the packer inspector position had been eliminated, that he was no longer a current employee under GPC's continuous service and leave policies, and that he would have to apply for open positions on the same basis as any other non-employee applicant. Consequently, Crano brought suit claiming, inter alia, that GPC unreasonably failed to accommodate his disability. The district court granted GPC's motion for summary judgment.

The Tenth Circuit affirmed, citing two of the district court's rationales. The court first held that GPC had no duty to reinstate Crano as a packer inspector after the position had been eliminated while he was on indefinite leave. The court noted that the ADA did not require GPC to create jobs or vacancies to accommodate Crano, nor did GPC's failure to make an exception to its leave policies (ie, preserve Crano's job for him until his return) constitute a failure to make a reasonable accommodation. Further, the Court also held that after Crano's status as a current employee expired, GPC was not required to reassign him to another job within the company. The Court noted that when GPC informed Crano that he could apply for open positions, coupled with GPC's disclaimer had no intention of discriminating against him. This action satisfied GPC's obligations under the ADA.

Employee's FLSA Claims Precluded By VPA

A federal district court recently held that the Volunteer Protection Act of 1997 (VPA) bars claims under the FLSA by a former employee against the board members of a youth center. Armendarez v. Glendale Youth Ctr Inc., 2003 WL 21241210 (D. Ariz. May 20, 2003).

Plaintiff Ana Armendarez was hired as the President and CEO of the Glendale Youth Center, Inc. (GYCI), an organization traditionally funded by grants. In early 1996, GYCI incurred serious debt. Armendarez decide to leave GYCI, but after getting the organization out of debt. However, in late 1996 and early 1997, Armendarez realized that GYCI would not be able to pay her a salary. GYC contended that Armendarez chose to stay without a salary to get the debts under control, but Armendarez believed that the board promised to pay her. Armendarez brought suit under the FLSA for her unpaid wages. GYCI asserted that the VPA precluded any claims under the FLSA.

The court agreed, and granted a motion to dismiss based upon the VPA. The VPA provides that volunteers of non-profit organizations or governmental entities cannot be held liable for acts on behalf of the organization in certain circumstances. Importantly, the VPA states that it 'preempts the laws of any State to the extent that such laws are inconsistent ' ' 42 U.S.C. ' 14502(a). The Court held that the text of '14502(a) cannot be interpreted to prevent the application of the VPA to federal law. Further, the legislative history of the VPA made no distinction between federal and state claims.

Moreover, the court noted that the VPA contains specific limitations on liability that includes both federal and state laws (eg, section 16 of Title 18). As Congress declined to list the FLSA as an exception, the court held that it could not imply that the FLSA was an exception to the VPA's limitations on liability.

The National Litigation Hotline was prepared by Jason S. Aschenbrand, an associate in the labor and employment department of Winston & Strawn's New York offices.

Plaintiff Crano was a packer inspector for Graphic Packaging Corp. (GPC) for over 10 years. In July 1996, he went on indefinite medical leave for treatment of liver disease, during which time GPC eliminated the packer inspector position. Crano sought to return to work in the spring and summer of 1998, during which time he made formal accommodation requests for reinstatement as a packer inspector (initially with a 4-hour work day, and gradually increasing), and also for assignment to any other position for which he was qualified. GPC responded by informing Crano that the packer inspector position had been eliminated, that he was no longer a current employee under GPC's continuous service and leave policies, and that he would have to apply for open positions on the same basis as any other non-employee applicant. Consequently, Crano brought suit claiming, inter alia, that GPC unreasonably failed to accommodate his disability. The district court granted GPC's motion for summary judgment.

The Tenth Circuit affirmed, citing two of the district court's rationales. The court first held that GPC had no duty to reinstate Crano as a packer inspector after the position had been eliminated while he was on indefinite leave. The court noted that the ADA did not require GPC to create jobs or vacancies to accommodate Crano, nor did GPC's failure to make an exception to its leave policies (ie, preserve Crano's job for him until his return) constitute a failure to make a reasonable accommodation. Further, the Court also held that after Crano's status as a current employee expired, GPC was not required to reassign him to another job within the company. The Court noted that when GPC informed Crano that he could apply for open positions, coupled with GPC's disclaimer had no intention of discriminating against him. This action satisfied GPC's obligations under the ADA.A federal district court recently held that the Volunteer Protection Act of 1997 (VPA) bars claims under the FLSA by a former employee against the board members of a youth center. Armendarez v. Glendale Youth Ctr Inc., 2003 WL 21241210 (D. Ariz. May 20, 2003).

Plaintiff Ana Armendarez was hired as the President and CEO of the Glendale Youth Center, Inc. (GYCI), an organization traditionally funded by grants. In early 1996, GYCI incurred serious debt. Armendarez decide to leave GYCI, but after getting the organization out of debt. However, in late 1996 and early 1997, Armendarez realized that GYCI would not be able to pay her a salary. GYC contended that Armendarez chose to stay without a salary to get the debts under control, but Armendarez believed that the board promised to pay her. Armendarez brought suit under the FLSA for her unpaid wages. GYCI asserted that the VPA precluded any claims under the FLSA.

The court agreed, and granted a motion to dismiss based upon the VPA. The VPA provides that volunteers of non-profit organizations or governmental entities cannot be held liable for acts on behalf of the organization in certain circumstances. Importantly, the VPA states that it 'preempts the laws of any State to the extent that such laws are inconsistent ' ' 42 U.S.C. ' 14502(a). The Court held that the text of '14502(a) cannot be interpreted to prevent the application of the VPA to federal law. Further, the legislative history of the VPA made no distinction between federal and state claims.

Moreover, the court noted that the VPA contains specific limitations on liability that includes both federal and state laws (eg, section 16 of Title 18). As Congress declined to list the FLSA as an exception, the court held that it could not imply that the FLSA was an exception to the VPA's limitations on liability.

The National Litigation Hotline was prepared by Jason S. Aschenbrand, an associate in the labor and employment department of Winston & Strawn's New York offices.