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The United States Supreme Court unanimously held that the National Collegiate Athletic Association (“NCAA”) cannot restrict education-related benefits provided by its member schools to student-athletes.  The decision in NCAA v. Alston, 141 S. Ct. 2141 (2021) arises out of a class-action lawsuit filed by current and former Division I student-athletes against the NCAA alleging anti-trust violations that restrict student-athletes from receiving a fair market rate for their labor. Anti-trust laws operate to promote competition between businesses and organizations to prevent monopolies by creating an even playing field among similar businesses.

The appeal to the Supreme Court stems from a federal district court ruling that permitted the NCAA to continue restricting benefits unrelated to education like cash payments to student-athletes in the form of salaries but prohibited the NCAA from restricting education-related benefits such as graduate school scholarships, post-graduate internships, and free laptops. The 9th Circuit Court of Appeals affirmed the decision of the district court, and the decision was appealed to the Supreme Court. The scope of the decision pertained only to the subset of NCAA rules restricting education-related benefits enjoined by the district court, not an across-the-board challenge to the NCAA’s rules restricting student-athlete compensation.

The NCAA urged the Court to overrule the 9th Circuit, arguing the lower courts misapplied the anti-trust standard of review, endorsing a less stringent examination to preserve the institution and integrity of American collegiate sports. Adding to this, the NCAA advanced the argument that because the NCAA is a joint venture offering its customers a unique product of intercollegiate athletic competition, the Association and its member schools are not a commercial enterprise, but are institutions advancing the societal objective of undergraduate education. In response, the athletes argue that the NCAA is asking for a complete exemption from federal anti-trust laws based on the NCAA’s reliance on a loose and inconsistent concept of “amateurism” and its importance in the realm of higher education. Pointing to the rapid ascension of college sports into the mainstream, the athletes underscore that the NCAA is a multi-billion-dollar business with television contracts in the billions per year that is only made possible by maintaining monopsony power – monopoly control on the buyer side – over the labor market for college athletes and price-fixing the ceiling on those labor costs.

A supervisor’s use of isolated but offensive racial slurs directed at and in the presence of an employee can give rise to a claim for a hostile work environment under New Jersey’s Law Against Discrimination (LAD) on their own. Rios v. Meda Pharm., Inc., 2021 N.J. LEXIS 553 (June 16, 2021). This is because the use of a racial epithet exacerbates its severity when uttered by a supervisor.

Plaintiff Armando Rios, Jr., a Hispanic employee, worked at Meda Pharmaceutical, Inc and alleged that his supervisor subjected him to a hostile work environment on account of two racial slurs directed at him while at work. According to Rios, during a conversation with his supervisor about Rios’ intentions to purchase a new home, his supervisor allegedly said, “it must be hard for a Sp– to have to get FHA loans.” About a month later, Rios’ supervisor allegedly made another racial comment while casting a role for a commercial that an actress “would work if she didn’t look too Sp–ky.” Rios claims he met with Human Resources after each incident and reported his supervisor’s comments, however, the Human Resources Director was dismissive and did not take action to remedy the situation. Rios filed a complaint asserting claims under, inter alia, the LAD, alleging a hostile work environment was created by his supervisor’s use of racial slurs. The trial court granted defendants’ motion for summary judgment, finding no rational factfinder could conclude Rios’ supervisor’s comments were sufficiently severe or pervasive to create a hostile work environment. The Superior Court Appellate Division affirmed those findings, and the issue was appealed to the State Supreme Court.

The overarching goal of the LAD is “nothing less than the eradication of the cancer of discrimination.” Fuchilla v. Layman, 109 N.J. 319, 334 (1988). To state a claim for a hostile work environment under the LAD and defeat summary judgment, a plaintiff must allege that the complained-of conduct (1) would not have occurred but for the employee’s protected class; and (2) it was severe or pervasive enough to make a (3) reasonable Hispanic person believe that (4) the conditions of employment are altered, and the working environment is hostile or abusive. Lehmann v. Toys ‘R’ Us, 132 N.J. 587, 603-04 (1993) (hostile work environment claim based on supervisor’s acts of alleged sexual harassment). The Lehmann standard applies generally to hostile work environment claims, including claims based on racial comments. Id.; See Taylor v. Metzger, 152 N.J. 490, 498-500 (1998). Hostile work environment claims must be evaluated in light of all of the circumstances, including the frequency of the discriminatory conduct, its severity, whether it is physically threatening or humiliating, or merely an offensive utterance, and whether it unreasonably interferes with an employee’s work performance. Cutler v. Dorn, 196 N.J. 419, 432 (2008).

Under New Jersey’s Law Against Discrimination (LAD), when an employee suffers injury due to their employer’s failure to accommodate his or her disability, the employer is liable for discrimination under LAD even when no direct economic harm or other form of adverse employment action was taken by the employer against the employee. Richter v. Oakland Board of Education, 2021 N.J. LEXIS 548, 2021 WL 2324982  (decided June 8, 2021). This is because the wrongful discriminatory act under LAD is the employer’s failure to perform its duty to accommodate an employee’s disability such as the one suffered by schoolteacher Mary Richter.

Plaintiff Mary Richter, a science teacher in the Oakland School District, is a type 1 diabetic and experienced a hypoglycemic event in a classroom, which resulted in severe, life-altering injuries.  At the start of the 2012-2013 school year, Richter’s lunch was scheduled for 1:05 p.m. Richter believed such a late lunch would negatively impact her blood sugar levels and asked the defendant, the principal of the school, if the schedule could be changed to allow her to have lunch earlier to better maintain her diabetic condition.  No change was made. Richter resorted to ingesting glucose tablets to maintain her blood sugar levels. An adjustment was made during the second marking period; however, in the third marking period, Richter was again scheduled for lunch at 1:05 p.m. In that third marking period, Richter suffered a hypoglycemic event in the class period before her scheduled lunch, seizing up, losing consciousness, and striking her head upon her fall, which resulted in extensive bleeding and injury. Richter was not terminated, demoted, or reassigned to another position, but filed an action against the school board under the LAD for failure to accommodate her disability. Prior to filing an action under the LAD, Richter filed a workers’ compensation claim for the work-related injuries and recovered for her medical bills and disability benefits.

Under the LAD, there is no explicit section addressing a reasonable accommodation or claim; however, New Jersey courts have consistently found the LAD requires employers to reasonably accommodate for an employee’s disability. Royster v. NJ State Police, 227 N.J. 482, 499 (2017). An employer is obligated to accommodate for an employee’s disability “unless it would impose an undue hardship on the operation on the business.” Potente, 187 N.J. at 110 (quoting N.J.A.C. 13:13-2.5(b)). To establish a failure-to-accommodate claim under the LAD, a plaintiff must establish that he or she (1) qualifies as an individual with a disability or is perceived as having a disability; (2) is qualified to perform the essential functions of the job with or without reasonable accommodation; and (3) that the defendant failed to reasonably accommodate his or her disabilities. Royster, 227 N.J. at 500.

Older doctors in New Jersey who are required to undergo medical screening examinations as a condition of maintaining hospital staff privileges likely have the right to sue for age discrimination under New Jersey’s Law Against Discrimination, N.J.S.A., 10:5-1, et seq. (“LAD”). Supporting this conclusion is the belief held by the federal Equal Employment Opportunity Commission (“EEOC”) that age-based medical screenings of doctors violates federal discrimination laws.

In February 2020, the EEOC filed a lawsuit against Yale New Haven Hospital Inc. (“Yale”), charging the health system with violating the Age Discrimination in Employment Act (“ADEA”), 29 U.S.C. § 621, et seq. and the Americans with Disabilities Act (“ADA”), 42 U.S.C. 12101, et seq. Specifically, the EEOC alleges Yale’s “Late Career Practitioner Policy” discriminates against medical practitioners on the basis of age. The hospital’s policy requires medical practitioners who are seventy (70) years or older to take ophthalmological and neuropsychological evaluations to test cognitive and eye function.  Yale claims the hospital policy has the salutary aim of screening to identify the potentially compromised abilities of older physicians. The EEOC lawsuit filed in 2020 in the U.S. District Court for the District of Connecticut (EEOC v. Yale New Haven Hospital, Civil Action No. 3:20-cv-00187) seeks relief against Yale including, inter. alia., a permanent injunction preventing Yale from carrying out the policy or other policies that “discriminate on the basis of age,” as well as to obtain back wages and liquidated damages on behalf of those doctors negatively affected by the policy. This lawsuit remains unresolved and pending as of this writing.

Should such age-based screening of doctors be found violative of the ADA and ADEA, it is predictable that our state courts will conclude these screenings equally violate New Jersey’s LAD.   This is because New Jersey courts generally interpret the LAD by reliance upon federal court decisions construing the analogous federal antidiscrimination statutes. Chisolm v. Manimon, 97 F. Supp. 615, 621 (D. N.J. 2000). For example, in LAD employment discrimination cases, federal precedents under Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e to 2000e-17, provide a key source of interpretive authority. Lehmann v. Toys `R’ Us, Inc., 132 N.J. 587, 600 (1993). In LAD cases specifically involving age discrimination in employment, New Jersey courts adopt the analysis of federal Title VII cases and federal cases under the ADEA. Giammario v. Trenton Bd. of Educ., 203 N.J. Super. 356, 361 (App. Div. 1985). Further, in LAD disability discrimination cases, the New Jersey courts look to the standards established in federal ADA cases. Lawrence v. National Westminster Bank New Jersey, 98 F.3d 61, 70 (3d Cir. 1996).

The failure to establish a causal nexus between protected whistleblowing activity and the termination of her employment was the demise of plaintiff’s whistleblowing claim in a recently issued Appellate Division opinion in Brown v. Regina Foley, et. al. 2021 N.J. Super. Unpub. LEXIS 957 (decided May 20, 2021).  In Brown, the reviewing court also affirmed that representations made in an employee handbook promising an employee a pre-termination disciplinary hearing are unenforceable when accompanied by a prominently displayed disclaimer making clear that representations contained in the handbook do not create an express or implied contractual obligation requiring the employer to comply with its own policies and procedures.

Plaintiff, Anne Brown (“Brown”), a pharmacy manager at Bayshore Community Hospital (“Bayshore”), asserted claims for wrongful discharge in violation of, among others, the New Jersey’s Conscientious Employee Protection Act (“CEPA”), N.J.S.A.  34:19-1 to -14. Bayshore terminated Brown for failure to report the undocumented and unauthorized removal of fentanyl vials from the hospital pharmacy’s drug dispensary cabinet, finding her failure to take any steps to report the missing vials to the Drug Enforcement Agency to be “egregious”. Brown argued in her complaint that the nonretaliatory reasons offered by Bayshore to justify her firing were pretext and that the true reason for her firing was, inter. alia., that she along with the hospital’s Chief Operating Officer had in the past complained about the alleged inferiority of a new automated system for dispensing controlled drugs. Brown also alleged she was not legitimately terminated because of the hospital’s failure to abide its prescribed disciplinary procedures when it failed to hold for her a review hearing prior to terminating her employment. Brown appealed the trial court’s grant to Bayshore of a motion for summary judgment dismissing her CEPA claim along with her other pled legal claims.

New Jersey’s CEPA law is designed to protect employee “whistleblowers,” making it unlawful for employers to take adverse employment action against employees who engage in protected, “whistleblowing” activities. N.J.S.A. §§ 34:19-1 et. seq.   To survive a motion for summary judgment in a CEPA action, a plaintiff must demonstrate that: (1) he or she reasonably believed that his or her employer’s conduct was in violation of a law, rule, regulation, or a clear mandate of public policy; (2) he or she performed a “whistle-blowing” activity described in N.J.S.A. 34:19-3(c); (3) an adverse employment action was taken against him or her; and (4) a causal connection exists between the whistle-blowing activity and the adverse employment action. Chiofalo v. State, 238 N.J. 527, 541 (2019).  A plaintiff-claimant bringing an action under CEPA need not show that his or her employer actually conducted fraudulent or illegal activity, rather they are only required to produce sufficient evidence to support an objectively reasonable belief that a violation has occurred. Dzwonar v. McDevitt, 177 N.J. 451, 463 (2003).

The New Jersey Supreme Court recently addressed, among other issues, the question of whether a “suggested course of action” by a supervisor to a subordinate can suffice as a reasonable belief under New Jersey’s whistleblower law that the supervisor wants the subordinate to engage in conduct that violates law or public policy.  Allen v. Cape May County, 2021 N.J. LEXIS 392 (decided May 12, 2021). The unclear answer provided by the majority in Allen to this question is that it depends on the facts and circumstances underlying the communications between supervisor and subordinate. Justice Albin’s opinion in dissent (in part) was as equivocal.

Kim Allen (Allen) was the Purchasing Agent for Cape May County (County) under a renewable contract of employment. She reported to Gerald Thorton (Thorton), the County Freeholder Director. The story begins when a law firm named Capehart & Scatchard (Capehart) submitted a bid to represent the County in its workers compensation cases specifying only a proposed hourly rate rather than the County’s preferred per-case quote. Upon learning this, Jeffrey Lindsay, who as Director of Human Resources and Thorton’s stepson, oversaw the department that handled workers’ compensation matters for the County, approached Allen, and asked whether Capehart could fax a new proposal page to supplement the bid. Allen told Lindsay that it would be “illegal” to accept a substituted page (no page was ever switched out on the bid). Subsequent thereto, Allen told attorneys from a law firm named Ballard Spahr who were hired as independent investigators of an unrelated matter, about her exchange with Lindsay and how concerning it was to her. Ballard Spahr’s findings were submitted to the Freeholders in which the firm concluded that Lindsay had done nothing wrong.

Following this, the Freeholders nonrenewed Allen’s contract based on Thorton’s recommendation.  Thorton claimed he made this recommendation because a number of department heads had complained about Allen’s job performance. Consequently, Allen filed a wrongful discharge whistleblowing lawsuit under New Jersey’s Conscientious Employee Protection Act (CEPA) alleging that her response to Lindsay’s inquiry about Capehart’s bid proposal and her statement to the Ballard Spahr investigator about that inquiry constituted CEPA-protected conduct.

Attorneys who violate the “Golden Rule” when providing a closing summation to a jury at trial risk losing a verdict for their clients, so says the New Jersey Superior Court, Appellate Division in Morgan v. Willie Maxwell II, et. al., 2021 N.J. Super. Unpub. LEXIS 718 (decided April 26, 2021). Plaintiff Shawna Morgan (Morgan) was an administrative assistant for musical rap artist Willie Maxwell, II a/k/a “Fetty Wap”, his touring company Fetty Wap Touring, Inc (collectively the Fetty Wap Defendants), and Goodfella4life Ent., d/b/a RGF Productions, Inc. (RGF), his recording label. Prior to the trial, the Fetty Wap Defendants settled Morgan’s claims alleging breach of contract damages and defamation.  Following a 5-day trial the jury entered a verdict in favor of Morgan and against RGF, the remaining defendant, in the sum of $1,167,065.63, representing an award of $980,000 for RGF’s alleged defamation of plaintiff, breach of contract damages totaling $66,294.42, and pre-judgment interest in the sum of $120,771.21. RGF appealed the verdict.

In addition to claims for unreimbursed expenses and unpaid commissions, Morgan’s lawsuit alleged the defendants defamed her when subsequent to her firing in April 2017, TMZ, a gossip website, published an article based on falsehoods propagated by the defendants alleging Morgan was fired for stealing money, and then RPG maliciously double-downed when it falsely alleged Morgan had misrepresented herself as a booking agent and illegally charged outside fees for her services.

At the close of trial, Morgan’s attorney argued to the jury:

Vincent Hager suffered serious work-related back injuries on a construction job while working for M&K Construction. He underwent surgeries and was prescribed opioid medication for his chronic pain which did not provide him adequate relief. Hager then enrolled in New Jersey’s medical marijuana program for pain management and to overcome his opioid addiction. He requested his M&K’s workers compensation carrier to reimburse him for the ongoing cost of his prescription marijuana.  Following a trial, the workers compensation court ordered M&K to reimburse Hager for the cost of his prescribed marijuana use. The Appellate Division affirmed, and the case was appealed by M&K to the New Jersey Supreme Court. On appeal, M&K argued: 1) that New Jersey’s Jake Honig Compassionate Use Medical Cannabis Act (the Compassionate Use Act) was preempted by the federal Controlled Substances Act, 2) medical marijuana is not reimbursable under the New Jersey Workers’ Compensation Act (WCA) as a reasonable or necessary treatment, and 3) that medical marijuana use fits within an action to the Compassionate Use Act and therefore is not a reimbursable expense. The New Jersey Supreme Court in affirming the courts below, rejected M&K’s arguments. Hager v. M&K Construction, 2021 N.J. LEXIS 332 (decided April 13, 2021).

The Court began its analysis by explaining how the Compassionate Use Act, N.J.S.A. 24:6I-1 to -30, was enacted in 2010 in recognition of the beneficial uses of marijuana and to protect authorized individuals from criminal and civil penalties. Wild v. Carriage Funeral Holdings, Inc., 458 N.J. Super. 416, 427 (App. Div. 2019) aff’d 241 N.J. 285 (2020). (See Mashel Law’s blog article posted on March 29, 2019 discussing the Appellate Division opinion in Wild). The Compassionate Use Act articulates legislative findings that, “[m]odern medical research has discovered a beneficial use for cannabis in treating or alleviating the pain or other symptoms associated with certain medical conditions”. The Court recognized that although the selling and distribution of medical marijuana is prohibited under federal law, many states like New Jersey have legalized it, and states are not required to enforce federal law. Id. at *14.

As to M&K’s argument that it need not reimburse Hager for his medical marijuana costs because under the Compassionate Use Act reimbursement for medical marijuana costs is not required of “a government medical assistance program or private health insurer,” the Court concluded that the Legislature did not intend for workers’ compensation insurers to be treated as private health insurers or government medical assistance programs under the Compassionate Use Act. Therefore, M&K is not exempt from its reimbursement obligation. Id. at *18 -*19.

Although there is no bright-line rule as to what constitutes an adverse employment action, New Jersey state and federal courts have held that actions causing direct economic harm (such as hiring, firing, failing to promote, or adjusting wages or benefits) qualify as adverse actions sufficient to support a prima facie case of employment discrimination. Domino v. Cty. of Essex, 2021 U.S. Dist. LEXIS 26261 (D.N.J. decided February 11, 2021); see also Campbell v. Supreme Court of New Jersey, 2014 U.S. Dist. LEXIS 176647, 2014 WL 7343225, at *6 (D.N.J. Dec. 23, 2014) (citing Durham Life Ins. Co. v. Evans, 166 F.3d 139, 152-53 (3d Cir. 1999)). However, this leaves open the question of whether a disabled employee may pursue a failure to reasonably accommodate disability discrimination claim under New Jersey’s Law against Discrimination (LAD) when there has been no direct economic harm adverse employment action taken against the employee. In Richter v. Oakland Bd. Of Educ., 459 N.J. Super. 400 (App. Div. 2019) our Appellate Division answered this question and did so in the affirmative.

Plaintiff Mary Richter was a middle school teacher who suffers from diabetes, alleges she fainted while teaching due to low blood sugar levels when she was unable to eat lunch at an earlier class period and suffered significant and permanent injuries. She contends the accident would not have occurred had the Oakland Board of Education defendants granted her accommodation as required under New Jersey’s LAD to miss cafeteria duty so that she court eat lunch earlier to avoid a decrease in her blood sugar levels. The Defendants claimed to the contrary that they did not require Ms. Richter to work cafeteria duty and because they did not deny her a requested accommodation, they did not violate the LAD.

Because Richter was not fired or reassigned to another position, the motion judge below determined Richter could not establish a prima facie case of adverse employment action, and the motion judge concluded as well that plaintiff’s injuries were not due to defendants’ action but rather due to Richter’s personal decision to continue attending cafeteria rather than eating.  Accordingly, the judge granted defendants’ motion for summary judgment dismissing Richter’s complaint, denied Richter’s cross-motion for summary judgment, and denied reconsideration of the dismissal. Richter appealed.

Following a trial at the Law Division and an appeal to the Appellate Division, the New Jersey Supreme Court was asked to resolve whether a plaintiff could recover damages under a promissory estoppel theory of liability because he relied on defendant’s promise in quitting his prior employment. Goldfarb v. Solimine, 2021 N.J. LEXIS 161, 245 A.3d 570, 2021 WL 626991 (decided February 18, 2021). In Goldfarb, Plaintiff Jed Goldfarb claimed defendant David Solimine reneged on a promise of employment after Goldfarb quit his job to accept the promised position. Although an employment agreement and its terms were never reduced to writing, plaintiff asserts that he received specific promises of a base salary and return on investments for managing in-house the sizeable investment portfolio of defendant’s family. In response, Solimine argued that because an employment contract was never reduced to writing as required by New Jersey’s Uniform Securities Law of 1997 (the Securities Law) Goldfarb was barred from pursing an action against him. The Securities Law intends to forbid the enforcement of an investment advisory contract that has not been reduced to writing. In resolving the issue before it in favor of plaintiff Goldfarb, the Court distinguished between a breach of contract claim where the Court found Goldfarb could not pursue a claim because of the Securities Law’s requirement that contracts be writing, and the reliance-based doctrine promissory estoppel open to Goldfarb because it had no such requisite.

To begin its analysis, the Court pointed to well established case law instructing that “[a] contract is an agreement resulting in obligation enforceable at law.” Borough of West Caldwell v. Borough of Caldwell, 26 N.J. 9, 24 (1958). “[T]he basic features of a contract” are “offer, acceptance, consideration, and performance by both parties.” Shelton v. Restaurant.com, Inc., 214 N.J. 419, 439 (2013). “A contract arises from offer and acceptance, and must be sufficiently definite ‘that the performance to be rendered by each party can be ascertained with reasonable certainty.'” Weichert Co. Realtors v. Ryan, 128 N.J. 427, 435  (1992) (quoting Caldwell, 26 N.J. at 24-25).  For a viable breach of contact claim a party may pursue benefit-of-the-bargain or expectation damages, that is, damages that plaintiff would have earned had the contact not been breached.  See Coyle v. Englander’s, 199 N.J. Super. 212, 214 (App. Div. 1985) (characterizing expectation damages, “i.e., loss of  the benefit of the bargain,” as the “traditional” form of damages for breach of contract). The purpose of such compensating damages “is to put the injured party in as good a position as if performance had been rendered.” Totaro, Duffy, Cannova & Co., L.L.C. v. Lane, Middleton & Co., L.L.C., 191 N.J. 1, 13 (2007) (ellipsis omitted) (quoting Donovan v. Bachstadt, 91 N.J. 434, 444 (1982)). [*23]

A promissory estoppel claim is different than a breach of contract claim. Promissory estoppel is made up of four elements: (1) a clear and definite promise; (2) made with the expectation that the promisee will rely on it; (3) reasonable reliance; and (4) definite and substantial detriment.” Toll Bros., Inc. v. Bd. of Chosen Freeholders of Burlington, 194 N.J. 223, 253 (2008); see Model Jury Charges (Civil), 4.10K “Promissory Estoppel” (approved May 1998). It has been long recognized that promissory estoppel is “a departure from the classic doctrine of consideration that the promise and the consideration must purport to be the  motive each for the other,” providing instead that the operative “reliance is on a promise.”  [*24], Friedman v. Tappan Dev. Corp., 22 N.J. 523, 536 (1956).  Under promissory estoppel a successful plaintiff is entitled to reliance damages. In contrast to contract-based expectation damages, reliance damages look backward.

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