Labor & Employment Law Daily Over $25K in sanctions against attorney for filing a ‘clearly time-barred’ ADA suit upheld
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Monday, October 1, 2018

Over $25K in sanctions against attorney for filing a ‘clearly time-barred’ ADA suit upheld

By Lorene D. Park, J.D.

Affirming $25,995.32 in sanctions against an attorney for “vexatiously” filing a “clearly time-barred” suit, the Sixth Circuit found that he provided no excuse for filing the ADA suit 200 days after the limitations period had run following issuance of the EEOC’s right-to-sue letter. Even after opposing counsel provided him case law definitively barring the suit under the statute of limitations, he maintained it all the way through to summary judgment. Though the attorney also raised a “grab bag of objections to the court’s calculations” of attorneys’ fees, none established an abuse of discretion. Before reaching these merits, the appeals court departed from prior precedent in holding that the lower court’s error in the standard of review it applied to the magistrate’s sanction calculation was not a jurisdictional issue (Carter v. Hickory Healthcare Inc., September 27, 2018, Sutton, J.).

A nursing home employee had asthma and could not be around cigarette smoke. Though the employer exempted her from monitoring patients’ smoke breaks, a new supervisor changed course in 2007 and told the employee to work smoke breaks. She refused and was fired.

Discrimination charge. That month, the employee filed a discrimination charge with the Ohio Civil Rights Commission. The state agency informed her that it filed a parallel charge with the EEOC under the ADA. For the next six years, her complaint inched its way through the state system. In November 2013, the Commission ruled in her favor and ordered the employer to reinstate her and pay lost wages. She then asked the EEOC for a right-to-sue letter. Because she had moved to a new location without notifying the agency, though, it sent the letter to her old address.

Over the next few months, her attorney contacted the agency, learned of the address error, and in November 2014, the employee’s attorney procured a copy of the right-to-sue letter dated February 20, 2014. The employee filed suit on December 9, 2014.

Attorney sanctioned for filing “clearly time-barred” suit. The district court held that the suit was time barred because it was filed more than 90 days after the date of her right-to-sue letter. The court also granted the employer’s motion to sanction the attorney for “unreasonably and vexatiously” maintaining a “clearly time-barred action.” The court referred the matter to a magistrate judge to compute the amount and the magistrate ordered the attorney to pay $25,995.32. The attorney appealed.

Error in reviewing magistrate order not jurisdictional issue. Before considering the merits, the appeals court had to deal with the fact that sanctions under 28 U.S.C. § 1927 count as a final, appealable judgment against an opposing attorney, so the district court should have reviewed the magistrate’s order de novo. The court erred, though, by reviewing for clear error. Though a Sixth Circuit decision from 25 years ago held that a district court’s error in reviewing a magistrate’s dispositive order deprived the court of appeals of jurisdiction, the appellate court now explained that the prior decision was no longer good law.

Since the prior Sixth Circuit decision, the Supreme Court drew a “helpful line between mandatory jurisdictional requirements and mandatory procedural rules” by stating that a mandatory procedure does not divest a court of jurisdiction unless Congress gives a “clear indication” it wanted the rule to be jurisdictional. Here, neither the Magistrates Act nor any other statute precluded the appeals court from hearing this appeal. Because the standard of review requirement created a mandatory, but not jurisdictional, rule, the parties could waive it. That’s what happened here because neither party raised the issue below or on appeal.

No excuse for filing suit 200 days late. On the merits, the appeals court affirmed the sanctions. The right-to-sue letter was dated February 20, 2014, which gave the attorney until May 26, 2014 to file suit. But he filed on December 9, almost 200 days late. Even after opposing counsel provided him case law definitively barring the employee’s ADA claim under the statute of limitations, he maintained the suit all the way through to summary judgment.

Though the attorney raised several arguments trying to excuse the late filing, the appeals court was unswayed. There was no evidence the Ohio agency misled the employee and his argument that she could rely on an assumption that the state agency would tell the EEOC of her address change was contrary to precedent. As to his assertion that the lower court erred by sanctioning him punitively, the appeals court explained, “these sanctions are meant to be ‘punitive.’”

Also rejected were the attorney’s challenges to the magistrate’s failure to reduce the fee award more to account for clerical tasks lawyers performed and to account for what he thought to be “excessive billing” on the part of defense counsel. “[I]f abuse of discretion review means anything,” wrote the court, “it must mean that we cannot readjust this type of judgment call absent a good explanation.” Because the attorney provided none, the sanctions were affirmed.

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