Justia U.S. 3rd Circuit Court of Appeals Opinion Summaries

A jury awarded more than $4.5 million to a class of dancers at the Penthouse Club, a Philadelphia “adult gentleman’s club,” owned and operated by 3001 Castor, for unpaid minimum wages and unjust enrichment under Pennsylvania law. The Third Circuit affirmed concluding that, as a matter of “economic reality,” the dancers were employees of Castor, not its independent contractors. The court rejected Castor’s “novel argument” that the federal Fair Labor Standards Act precluded the class’s claims for unjust enrichment. Castor is not entitled to any credit or offset against the jury award for payments already received by the dancers. View "Verma v. 3001 Castor Inc" on Justia Law

Matheis, a retired police officer who has successfully managed a diagnosis of PTSD, routinely and safely donated plasma roughly 90 times in an 11-month period at CSL’s plasma donation facility. CSL barred him from making further donations when he brought his new service dog, Odin, to the facility, citing its policy to bar any individual who is prescribed daily more than two separate anxiety medications or who uses a service animal to manage anxiety. The company required Matheis to provide a letter from his doctor stating he had no need for a service animal before it would screen him for further plasma donation. He sued under the Americans with Disabilities Act, 42 U.S.C. 12181. The Third Circuit reversed the district court. Plasma donation centers are “service establishments,” subject to the ADA’s prohibition on unreasonable discrimination. CSL violated the ADA by imposing a blanket ban on prospective donors who use a psychiatric service animal. Public accommodations like CSL must permit disabled individuals to use service animals unless they can show a regulatory exception applies, “based on actual risks and not on mere speculation, stereotypes, or generalizations about individuals with disabilities.” View "Matheis, Jr. v. CSL Plasma Inc" on Justia Law

After a confrontational screening at Philadelphia International Airport in 2006, during which police were called, Pellegrino asserted intentional tort claims against TSA screeners. Under the Federal Tort Claims Act, the government generally enjoys sovereign immunity for intentional torts committed by federal employees, subject to the “law enforcement proviso” exception, which waives immunity for a subset of intentional torts committed by employees who qualify as “investigative or law enforcement officers,” 28 U.S.C. 2680(h). The Third Circuit first affirmed the dismissal of Pellegrino’s suit, holding that TSA screeners are not “investigative or law enforcement officers.” On rehearing, en banc, the court reinstated the suit. The words of the proviso dictate the result: TSOs are “officer[s] of the United States” empowered to “execute searches” for “violations of Federal law.” View "Pellegrino v. Transportation Safety Administration" on Justia Law

Haberle’s long-time partner, Nixon, suffered from severe mental illness. Nixon committed suicide during an encounter with the Nazareth Police Department. Haberle alleged that the Department’s failure to accommodate mentally disabled individuals constituted a violation of the Americans with Disabilities Act, 42 U.S.C. 12101–213. After a remand, Haberle filed an amended complaint. The district court dismissed it for failure to allege intentional discrimination. The Third Circuit again reversed and remanded. Haberle’s complaint raises a plausible claim that the Police Department was deliberately indifferent in failing to enact policies accommodating mental disability. Haberle alleges Department officers and its chief “routinely” encountered “mentally challenged individuals,” including two named individuals and that officers were often “verbally abusive” and “harassing,” and performed arrests without accommodating the individuals’ disabilities. In response to those and similar events, Officer Lahovski drafted a policy to guide Department interactions with disabled individuals, relying on his personal mental health training, Police Department procedures, and consultation with mental health professionals. Haberle alleged that in drafting that proposed policy, Lahovski identified the grave risks to mentally challenged persons as a result of the Police Department continuing to operate without proper policies and procedures for the accommodation of mentally disabled persons, but the Department did not adopt that or any other accommodation policy. View "Haberle v. Borough of Nazareth" on Justia Law

Penn boarded Fantasy’s horses. After some of its horses became sick or injured and even died, Fantasy refused to pay boarding invoices totaling $65,707. Fantasy told Penn’s veterinarian, Edelson, that it was considering suing him; they entered into an agreement releasing “any and all persons, firms, or corporations liable or who might be liable . . . [from liability] arising out of or in any way relating to any injuries and damages of any and every kind . . . [in] the care and/or treatment of any [Fantasy] horses stabled at Penn.” Penn sued for breach of contract and defamation, based on emails sent to individuals in the industry blaming Penn for the deaths of Fantasy’s horses, calling the staff “inexperienced,” and accusing Penn of trying to conceal the problems. Fantasy counterclaimed, alleging negligence, breach of contract, and breach of fiduciary duty. The district court rejected the negligence counterclaims, based on the Edelson release. A jury awarded Penn $110,000 for breach of contract, $1 in nominal damages for defamation, and $89,999 in punitive damages. The court reduced the punitive damages to $5,500. The Third Circuit affirmed, except as to punitive damages. If the court finds, on remand, that the $89,999 award is unconstitutionally excessive, it should explain why it is not within the range of reasonable punitive damages for this claim and why a lower award reflects the reprehensibility of the conduct. View "Jester v. Hutt" on Justia Law

The Pennsylvania House of Representatives begins most legislative sessions with a prayer. Plaintiffs challenged two practices: the House invites guest chaplains to offer the prayer, but it excludes nontheists (those who do not espouse belief in a god or gods, though not necessarily atheists) from serving as chaplains on the theory that “prayer” presupposes a higher power and visitors to the House chamber pass a sign asking them to stand for the prayer, and the Speaker of the House requests that audience members “please rise” immediately before the prayer. At least once a House security guard pressured visitors who refused to stand. The Third Circuit upheld the practices as to the Establishment Clause because only theistic prayer can satisfy the historical purpose of appealing for divine guidance in lawmaking, the basis for the Supreme Court taking as a given that prayer presumes a higher power. Legislative prayer is government speech and not open to challenges under the Free Exercise, Free Speech, and Equal Protection Clauses. With respect to the statement “please rise” for the prayer, the court held that the single incident involving pressure from a security guard is moot. The sign outside the House chamber and the Speaker’s introductory request that guests “please rise” are not coercive. View "Fields v. Speaker of the Pennsylvania House of Representatives" on Justia Law

The Federal Railway Safety Act (FRSA) provides that if railroad carriers retaliate against employees who report safety violations, the aggrieved employee may file a complaint with OSHA within 180 days after the alleged retaliation, 49 U.S.C. 20109(d)(2)(A)(ii). The Secretary of Labor then has 210 days to issue a final decision. If the Secretary takes too long, the employee may file suit. Guerra, a Conrail conductor and brakeman, alleged that Conrail urged him to ignore safety regulations. When he refused, Conrail threatened him and eliminated incidental perks of his job. Guerra reported this to Conrail’s compliance office. He says he was told that if he kept reporting safety issues, there would be “undesirable consequences.” Soon after Guerra filed complaints about allegedly defective braking systems, a train Guerra was operating failed to brake properly and ran through a railroad switch. On April 6, 2016, Conrail notified Guerra that he would be suspended. On May 10, Guerra’s attorney, Katz, allegedly filed a FRSA complaint. Receiving no response, on November 28, Katz followed up with OSHA by email. OSHA notified Guerra that his claim was dismissed as untimely because OSHA first received Guerra’s complaint 237 days after the retaliation. Guerra attempted to invoke the common-law mailbox rule’s presumption of delivery. The district court dismissed for lack of jurisdiction. The Third Circuit affirmed on other grounds. FRSA’s 180-day limitations period is a non-jurisdictional claim-processing rule. Guerra’s claim still fails because he has not produced enough reliable evidence to invoke the common-law mailbox rule. View "Guerra v. Consolidated Rail Corp" on Justia Law

Wolfington brought a claim under the Truth in Lending Act, 15 U.S.C. 1601, stemming from reconstructive knee surgery he received from Reconstructive Orthopaedic Associates (the Rothman Institute). Wolfington alleged that Rothman failed to provide disclosures required by the Act when it permitted him to pay his deductible in monthly installments following surgery. The district court entered judgment, rejecting Wolfington’s claim because it determined he had failed to allege that credit had been extended to him in a “written agreement,” as required by the Act’s implementing regulation, Regulation Z. The court also sua sponte imposed sanctions on Wolfington’s counsel. The Third Circuit affirmed in part, agreeing that Wolfington failed to adequately allege the existence of a written agreement, but concluded that counsel’s investigation and conduct were not unreasonable. In imposing sanctions, the district court placed emphasis on the statement by Rothman’s counsel, not Wolfington’s. The statement by Wolfington’s counsel did not amount to an “unequivocal” admission that there was no written agreement. View "Wolfington v. Reconstructive Orthopaedic Associates II, PC" on Justia Law

Under the Fair Labor Standards Act, 29 U.S.C. 207, employers must pay employees one-and-a-half times their “regular rate” of pay for all hours worked above a 40-hour work week. “[R]egular rate” includes “all remuneration for employment paid to, or on behalf of, the employee,” subject to eight enumerated exemptions but “remuneration for employment” is not defined in the overtime provisions or elsewhere in the Act. The Department of Labor asserted that employers are bound to include bonuses from third parties in the regular rate of pay when calculating overtime pay, regardless of what the employer and employee may have agreed. The district court, agreeing with the Department, concluded that the incentive bonuses at issue must be included in the regular rate of pay because they are remuneration for employment and do not qualify for any of the statutory exemptions. The Third Circuit vacated in part. Incentive bonuses provided by third parties are not necessarily “remuneration for employment” under the Act, depending on the understanding of the employer and employee. In this case, the factual record did not support a finding that all of the incentive bonuses were necessarily remuneration for employment. View "Secretary United States Department of Labor v. Bristol Excavating, Inc." on Justia Law

Stone sued Troy Construction, on behalf of herself and others similarly situated, alleging a willful violation of the Fair Labor Standards Act (FLSA). She claims that Troy paid local employees per diem compensation that should have been classified as wages and included in the regular rate of pay, which would have affected the calculation of overtime pay. The district court granted Troy summary judgment, holding that there had been no willful violation of the FLSA. Whether a violation is willful determines the length of the applicable statute of limitations; the court applied a two-year statute of limitations and concluded that Stone’s claims were time-barred. The Third Circuit vacated. The district court required a showing of conduct worse than recklessness while recognizing that Troy “appear[ed] to agree that excluding per diem[s] when calculating overtime rates for [out-of-state] employees is acceptable under the statute.” Troy therefore knew that per diems for non-local employees were implicated and permissible under the FLSA, but Troy’s professed ignorance about the implications of the same per diems paid to local employees did not meet the court’s standard. That analysis did not give Stone the benefit of a fair inference that Troy did recognize the implication of the per diems paid to local employees. View "Stone v. Troy Construction LLC" on Justia Law