I enjoyed chatting with Ron Sykstus on his “Next Lawyer Up” podcast.
My friend, Ron Sykstus, recently invited me to participate in his Next Lawyer Up podcast. Ron is an awesome attorney who is a partner with the Bond & Botes law firm. Next Lawyer Up has 130 podcast episodes featuring attorneys across the Southeast. The podcast is a “show where lawyers talk about lawyering and how they got into law.”
In addition to the practice of law, the podcast touches on news, politics, career building and philanthropy. Notable lawyers from around Alabama have been guests, including former Lt. Governor Bill Baxley, former Lt. Governor and prominent trial lawyer Jere Beasley, and U.S. Senator Doug Jones.
OSHA could not issue a citation for violating the “general duty” clause when it also promulgated a specific safety regulation for forklifts.
The Occupational Safety and Health Administration has been stepping-up its enforcement efforts recently. Anecdotally, I’m seeing and hearing about more workplace inspections and more citations from OSHA inspectors. Recently, the Eleventh Circuit Court of Appeals issued an opinion that will help employers defend against OSHA citations. See Chewy, Inc. v. U.S. Department of Labor, No. 22-11626, 2023 WL 3713222 (11th Cir. May 30, 2023).
One of OSHA’s favorite weapons is the “general duty” clause. Employers have a “general duty” to provide employees with a safe workplace. See 29 U.S.C. § 654(a)(1). An employer fails this general duty when it: (1) fails to render the work place free of a hazard; (2) the hazard was recognized; (3) the hazard caused, or was likely to cause, death or serious physical harm; and, (4) the hazard was preventable. Ga. Elec. Co. v. Marshall, 595 F.2d 309, 320-21 (5th Cir. 1979). So, if an employee is injured at work, and an employer does not violate a specific safety standard, OSHA will frequently issue a citation for violation of the “general duty” clause.
You would logically think that OSHA would not issue a “general duty” citation if an employer complied with a specific OSHA safety standard. Not so fast, my friend. In the Chewy case, the employer complied with a specific safety standard for forklift safety. Even so, OSHA decided to issue a citation for an alleged violation of the “general duty” clause.
The Chewy case involved “under-ride” accidents which occur when the chassis of a forklift is short enough to can pass under warehouse shelves without colliding with them — such that the driver’s body collides with the shelves. OSHA’s specific safety standards require forklift operators to receive safety training, look in the direction of travel, keep a clear view of the path of travel and maintain a safe speed. See 29 C.F.R. § 1910.178.
Chewy, Inc. complied with those standards but there were still two under-ride accidents within six months. OSHA cited Chewy for violating the “general duty” clause and an Administrative Law Judge upheld that citation.
The Eleventh Circuit reversed. The Court relied upon Department of Labor regulations, an OSHA administrative decision and prior case law to find that “compliance with an applicable safety standard bars general duty liability.” Chewy, Inc., 2023 WL 3713222 at *2. OSHA tried to argue that its specific forklift safety standard did not cover the danger of under-rides. But, the Eleventh Circuit rejected that argument. Because Chewy complied with OSHA’s forklift safety standards, it could not be cited for a “general duty” violation.
This is an important victory for employers. Obviously, employers need to comply with OSHA safety standards. But, they also need to be confident that they cannot be cited if they comply with those standards. If OSHA tries to issue a “general duty” citation to your business, double-check to see if you have complied with any applicable specific safety standards. If so, you may have an additional defense to the citation.
If a federal judge asks you to explain a “misrepresentation” to the Court, you probably shouldn’t say the judge has been “overly literal” and “hasty.”
Here’s a cautionary tale for lawyers: Don’t tell a federal judge that a fact is “undisputed” when it is in dispute. And, don’t double-down on calling it undisputed when the Judge holds a hearing to ask you about it. See McClinton v. Capstone Logistics, LLC, No. 2:20-cv-543-AMM, 2023 WL 3274937 (N.D. Ala. May 4, 2023).
Richard McClinton sued Capstone Logistics claiming that he was discriminatorily fired in violation of federal law. Capstone claimed there was no discrimination and that McLinton was fired falsifying a Corrective Action Form. McLinton testified at deposition that he did not falsify the form. McLinton’s former supervisor said that McLinton did falsify the form. This is the quintessential dispute of material fact which is submitted to a jury for resolution.
Nevertheless, Capstone’s lawyers filed a summary judgment brief asking for dismissal of the case and repeatedly claiming it was undisputed that McLinton falsified the form. McLinton responded and demonstrated that this crucial fact was in dispute. “On reply, Capstone’s counsel did not withdraw but rather persisted in their misrepresentation that it was undisputed that Mr. McLinton doctored the Corrective Action Notice.” McLinton, 2023 WL 3274937 at *3.
United States District Court Judge Anna M. Manasco denied Capstone’s motion for summary judgment and scheduled a hearing for its lawyers to explain “why this misrepresentation does not violate their duty of candor to the court and Federal Rule of Civil Procedure 11(b)(3).” McLinton, 2023 WL 3274937 at *3.
Most lawyers would come to the hearing hat-in-hand and beg for forgiveness. Capstone’s lawyer took a different approach. He claimed that the summary judgment argument was merely “unclear.” Judge Manasco told the attorney that his argument was “nonresponsive to the Court’s concern about misrepresentation.” McLinton, 2023 WL 3274937 at *4. Nevertheless, counsel persisted in calling his summary judgment brief “unclear.” Id. Moreover, he persisted with his argument “[e]ven after the court explained that Capstone’s pleading had not been merely ‘unclear,’ but had been ‘the opposite of … true.” Id.
At the conclusion of the hearing, Judge Manasco ordered counsel to “brief the issue of appropriate sanctions.” McLinton, 2023 WL 3274937 at *5. At this point, most lawyers would roll over and play dead. But, Capstone’s lawyers decided to challenge the judge. They claimed: (1) she was acting “in contravention of Rule 11”; (2) their filings “accurately stated the undisputed facts”; and, (3) sanctions weren’t appropriate because Judge Manasco wasn’t actually misled by any representation. Id. To make matters worse, they said that Judge Manasco had applied an “overly literal” and “hasty” reading of their summary judgment brief. Id.
Unsurprisingly, Judge Manasco was not convinced to withhold sanctions. Instead she found:
Based on Capstone’s post-hearing brief, the court finds that Capstone’s counsel did not inadvertently, overzealously, or even recklessly stumble into a regrettable mistake—after they deliberately misrepresented a fact, they later repeated that misrepresentation, and still later were not discouraged or deterred by the court’s inquiry, nor by the clearly stated risk of sanction.
McLinton, 2023 WL 3274937 at *5.
Ouch.
Judge Mansaco issued the sanction of admonishment with circulation. “The admonishment is to not make material misrepresentations to a tribunal.” McLinton, 2023 WL 3274937 at *8. She also ordered that the admonishment must be circulated to every attorney in Capstone’s law firm, which is composed of more than 500 lawyers in 36 offices across the United States.
It’s easy for me to Monday Morning Quarterback this case. I don’t know all of the facts or the strategies that went into Capstone’s arguments. But, based on Judge Manasco’s version of events, I probably would have adopted a different strategy.
It should also be noted that Judge Manasco was also unhappy with Mr. McClinton’s lawyer. In a separate opinion she sanctioned him with a public reprimand for willfully failing to comply with her orders regarding length, formatting and filing of briefs. McLinton v. Capstone Logistics, LLC, No. 2:20-cv-543-AMM, 2023 WL 3274937 (N.D. Ala. May 4, 2023).
An attorney who claims that he was fired for posting on social media will be allowed to sue the attorney who allegedly got him fired.
What you say on social media can get you fired. But, sometimes you can sue for it. That’s the lesson to be learned from the Alabama Supreme Court’s recent case in Flickinger v. King, No. SC-2022-0721, 2023 WL 3029709 (Ala. Apr. 21, 2023).
Daniel Flickinger was an associate attorney for a Birmingham law firm who posted the following message about George Floyd on Facebook:
Things I think about: If I were a seven-time felon, with my most recent prison stint stemming from robbing and holding a pregnant woman at gunpoint in her home, would I choose to die in a fentanyl and methamphetamine numbed strangulation if it meant being worshipped in a nationwide funeral and my family receiving millions of dollars? Purely hypothetical.
The next day, Flickinger was called into a meeting with the partners at his law firm and forced to resign. During that meeting, the partners showed Flickinger social media posts allegedly generated by Lawrence King – another attorney at a completely different law firm. Flickinger claimed that King created a “counterfeit” social media profile with his law firm photograph and law firm information. The partners told Flickinger that they communicated with King who could “control” the distribution of information favorably for the partners and their firm. After Flickinger resigned, King issued social media posts speaking favorably about the firm. King also issued other posts “gloating” about his ability to get people fired if he disagreed with their opinions.
Flickinger sued King and King’s law firm for: (1) defamation; (2) invasion of privacy; and (3) tortious interference with Flickinger’s employment. The trial court granted a motion to dismiss all claims and Flickinger appealed. The Alabama Supreme Court affirmed dismissal of Flickinger’s defamation and invasion of privacy claims but reversed dismissal of the tortious interference claim.
King tried to argue that Flickinger must show “fraud, force or coercion” that led to Flickinger’s termination. The Court rejected that argument and noted that the “fraud, force or coercion” requirement was eliminated from Alabama case law in 2009. The Court also noted that Flickinger was terminated almost immediately after King contacted his law firm.
To be clear, this was a reversal of a motion to dismiss. To survive dismissal, Flickinger was only required to allege the basic requirements of a tortious interference claim – and the Supreme Court found that he met that lenient standard. Flickinger must now go through discovery and prove that King got him fired.
At the end of the day, I imagine both Flickinger and King are regretting their conduct on social media. Actions have consequences. Flickinger spoke out and lost his job. King allegedly gloated on social media and got sued. Be careful what you say on social media, because it can (and will) be used against you.
I am excited to announce that I will be a speaker at the 2023 DRI Employment and Labor Law Seminar to be held from May 3-5, 2023 in New Orleans. The name of my session is: “Litigation Workshop: An Off-The-Record Discussion About The Record At Trial And On Appeal.” I will be moderating a discussion with The Honorable Cory Wilson, Fifth Circuit Court of Appeals The Honorable Donna Phillips Currault, United States Magistrate Judge, New Orleans, LA.
This is a truly unique opportunity to improve your litigation skills. Judge Wilson and Judge Currault will provide unique insight from their experience on their strategy for creating an effective record for trial and appeal.
To register, please click the following link then the “Register Now” button.
Employers need to review their handbook disclaimers to ensure that they are not accidentally creating an employment contract.
Alabama employers should immediately review their employee handbooks to ensure that they are not creating an employment contract with their employees. Most employers know that they need to have a disclaimer at the beginning of their handbooks. But, a recent case from the Alabama Supreme Court demonstrates that some disclaimers are not as effective as others. See Davis v. City of Montevallo, No. 1210016, 2023 WL 180252 (Ala. Jan. 13, 2023).
A quick review of Alabama employment law. In the absence of an employment contract, all employment in Alabama is “at will” — meaning that the employment relationship can be terminated by the employer or employee at any time for no reason whatsoever. But, an employee handbook can create an employment contract if it offers specific promises that are accepted by the employee. Employers can avoid accidentally creating an employment contract by including a provision in their handbook that essentially says: “This handbook is not a contract.”
In Davis, the City of Montevallo distributed an employee handbook with a disclaimer, but the handbook also contained a promise that specific procedures would be followed in the event of termination (including notice and a hearing). Even though Mr. Davis was an “at will” employee, he argued that the City was still required to follow the termination procedures before he could be fired. The language of the disclaimer was crucial to the Court’s decision:
I acknowledge having been given a City of Montevallo Personnel Handbook and have been asked to carefully read it. I have been informed that I may ask my supervisor any questions that I do not understand. I understand that nothing in this Handbook can be interpreted to be a contract for employment for any specified period of time or to place a limitation on my freedom or the City’s freedom to terminate the employment relationship at any time. I also understand that the City retains the freedom to change the Policies and Procedures with the approval of the Mayor and City Council.
The Supreme Court distinguished between the reason for terminating an employment relationship and the means used to terminate the relationship. The Court found that Montevallo’s disclaimer permitted the city to terminate for no reason, but that the procedural language in the handbook also provided a promise regarding the means by which Mr. Davis would be terminated. The Court reversed dismissal of Mr. Davis’s lawsuit. Presumably, he will be reinstated and given notice and a termination hearing.
Fortunately, the Court also provided clear guidance on how to avoid Montevallo’s fate by noting that a different result would occur if different handbook language was used:
“This Handbook and the policies contained herein do not in any way constitute, and should not be construed as a contract of employment between the employer and the employee, or a promise of employment.”
or
“The policies in this booklet are not an expressed or implied contract of employment.”
The key lesson from Davis is that some disclaimers are better than others at preventing the creation of an employment contract. Therefore, Alabama employers should immediately review their handbooks to make sure that their disclaimer language unequivocally says: “This handbook is not a contract.”
Join me Wednesday, November 17, for a FREE webinar discussing federal vaccine mandates.
Do you have questions about the federal vaccine mandates? Are you struggling with federal compliance in the face of Alabama’s new law limiting vaccine requirements?
If so, please join me next Wednesday, November 17 at 1:00 CST for a free webinar discussing the mandates and compliance issues. I’m teaming with ADP to provide guidance on, and potential solutions to, many of the issues employers are facing.
Most federal judges find that insurance does not cover claims for business losses related to COVID-19.
COVID-19 has wreaked havoc on the lives of almost every American. It has also devastated many businesses which were forced to shut down by government order or simple lack of customers. Faced with devastating losses, many businesses have attempted to get insurance coverage to reimburse them. The general idea is: My business closure for COVID-19 reasons is no different from closure because of a fire. So, my insurance should pay for my COVID-19 losses in the same manner as a closure for a fire.
Insurance companies disagree with that basic analysis. In most cases, insurance companies are denying coverage for COVID-19 businesses losses. As a result, businesses around the country are suing trying to get courts to award them coverage. Usually, these claims are litigated in federal court. And, the vast majority of federal courts are holding that COVID-19 business claims are not covered by insurance.
An insurance policy is a contract. So, courts deciding these coverage issues have to interpret the contract. The language of almost every policy only provides coverage for: “direct physical loss or damage.” As a result, most insurance companies differentiate between a “physical loss” to fire and a non-physical loss caused by COVID-19. After all, the brick-and-mortar business is still standing. Additionally, some policies have exclusions — provisions that deny coverage for specific reasons. Many policies specifically exclude any loss or damage caused by a virus. Because of those provisions, most federal judges in Alabama have found that COVID-19 business losses are not covered by insurance.
Hillcrest Optical, Inc. v. Continental Cas. Co., No. 1:20-CV-275-JB-B, 2020 WL 6163142 (S.D. Ala. Oct. 21, 2020). Judge Beaverstock focused on the word “physical” and found that there must be some “tangible” alteration to the property. Because COVID-19 does not tangibly alter property, business losses are not covered.
Part Two, LLC v. Owners Ins. Co., No. 7:20-cv-01047-LSC, 2021 WL 135319 (N.D. Ala. Jan. 14, 2021). Judge Proctor found that coverage was precluded by a virus exclusion.
Pure Fitness, LLC v. Twin City Fire Ins. Co., No. 2:20-CV-775-RDP, 2021 WL 512242 (N.D. Ala. Feb. 11, 2021). Judge Proctor again found coverage barred by a virus exclusion.
The Woolworth, LLC v. Cincinnati Ins. Co., No. 2:20-CV-01084-CLM, 2021 WL 1424356 (N.D. Ala. Apr. 15, 2021). Judge Maze found that there was no physical damage or loss. “A virus does not physically alter the property it rests on. A virus does not require property to be repaired, rebuilt or replaced. A virus can simply be wiped off the surface with disinfectant, so there is no ‘physical damage,’ no ‘physical loss,’ and no ‘period of restoration’ of property.” Notably, Judge Maze also relied upon a 2020 decision from the Eleventh Circuit Court of Appeals, applying Florida law to hold that “dust and debris” in a restaurant cannot be a “direct physical loss” because it “merely needs to be cleaned.” See Mama Jo’s, Inc. v. Sparta Ins. Co., 823 Fed. Appx. 868 (11th Cir. 2020).
Ascent Hosp. Mgmt. Co, LLC v. Employers Ins. Co. of Wausau, No. 2:20-cv-770-GMB, 2021 WL 1791490 (N.D. Ala. May 5, 2021). Magistrate Judge Borden found that “direct physical loss must be a loss requiring repair or replacement.” He also applied a contamination exclusion to deny coverage.
Dukes Clothing, LLC v. The Cincinnati Ins. Co., No. 7:20-cv-860-GMB, 2021 WL 1791488 (N.D. Ala. May 5, 2021). Judge Borden again denied coverage, finding that “direct physical loss or damage required an actual physical change to property that COVID-19 particles cannot cause.”
Against this tide of decisions stands one federal judge in Alabama: Judge Haikala. Each of the foregoing six cases was dismissed immediately after filing. In a recent opinion, however, Judge Haikala refused to follow that trend. See Serendipitous, LLC v. The Cincinnati Ins. Co., No. 2:20-cv-00873-MHH, 2021 WL 1816960 (N.D. Ala. May 6, 2021). Notably, the insurance policy in Judge Haikala’s case did not have a virus exclusion. Thus, she was only confronted with the issue of whether COVID-19 business closure was the result of “accidental physical loss or accidental physical damage.” Judge Haikala focused on “physical loss,” noting that “loss” can be defined as “the act of losing possession.” And, the restaurants in Judge Haikala’s case alleged that they were forced to “close completely” either as a result of government orders or the need to clean when an employee tested positive. Consequently, she refused to dismiss the restaurants’ complaint.
Almost certainly, Judge Haikala’s case will continue and the parties will conduct discovery on the exact nature of damages suffered by the restaurants. And, after discovery the insurance company will again move to dismiss the claim at the summary judgment stage. There is some possibility that Judge Haikala could change her analysis in the interim. Also, the Eleventh Circuit might issue a decision directly addressing the “physical loss or damage” issue. But, for now, Judge Haikala has provided a path that businesses might try to follow to obtain coverage for their COVID-19 losses.
Non-competition agreements that are part of the sale of a business can be binding even after the death of the person is who is supposed to refrain from competition.
The old saying goes: Nothing in life is certain but death and taxes. Well, the Alabama Supreme Court just made sure that your non-competition agreement is certain — even after you die. See Boyd v. Mills, No. 1190615, 2021 WL 1589331 (Ala. Apr. 23, 2021). At first blush, this seems like a ridiculous premise: How can I compete with anybody after I’m dead????
On closer examination, it looks like the Supreme Court was just trying to reach a fair result. In 2006, Thomas Batey sold his company, Batey & Sanders, to John Boyd for $2,136,631.62. Boyd was supposed to pay that amount in 120 equal monthly payments starting on December 1, 2006. Unfortunately, Batey died in April 2013 before the purchase price was paid-off. Boyd continued to make payments to Batey’s estate until December 2013. When he stopped, he still owed three years’ of payments totaling $640,989.36. Boyd claimed that he didn’t have to pay the remainder because the non-competition agreement was a personal services agreement by Batey (the service being a lack of competition). Since Batey’s death meant he could no long provide that service, Boyd thought he shouldn’t have to pay.
The Supreme Court addressed one issue: “whether the buyers’ obligation under the noncompete survived Batey’s death.” Thus, the real issue was not whether Batey was competing, but whether the buyer (Boyd) was still required pay. And, under the particular facts of this case, the Court found that Boyd should continue payments even after Batey’s death. In particular, the Court relied upon a decision from Georgia which held: “when a noncompetition agreement ancillary to the sale of a business does not also require the seller to affirmatively provide services to the buyer, the essential benefit to the buyer is purchasing the business’s goodwill (as opposed to the seller’s expertise) … [s0] the seller’s death does not deprive the buyer of his benefit.”
So, upon closer examination, the Batey case is not focused on competition as much as doing-the-right-thing. The main thing that Boyd bought in the transaction was the goodwill of Batey’s business. He shouldn’t get that goodwill at a steep discount simply because of Batey’s death.
The Court left-open the possibility that it could reach a different result in a case where a non-competition agreement was connected to employment or specific skills of the seller. So, there might be a more-important lesson to learn from the Batey case: Parties negotiating a non-competition agreement with installment payments should include a provision that clearly states the obligations of the parties if either dies.
Frank Lockwood at work — shortly before the fight of his life.
Many of my friends have shared or commented on a video making the rounds on social media from a group called “Frontline Doctors.” At least one of the “shares,” explicitly called COVID-19 a “hoax.” Apparently, some of my friends are upset that Facebook and Twitter are removing the video. I hope that they have actually watched this video. I have.
In the video, a doctor from Houston claims that there is a “cure” for COVID and no need to wear masks. According to her, hydroxychloroquine, combined with other regimens, is the solution.
In my opinion, those statements are irresponsible and openly encourage life-threatening conduct. Therefore, I wholeheartedly endorse removal of those statements from social media platforms.
Some of my friends believe that we should have a public debate about the benefits of hydroxychloroquine. That’s fine. But, please don’t rely solely upon this one doctor’s opinion.
My brother is a true Frontline Doctor. He is a family practice doctor in Stockbridge, Georgia. He treats people with COVID-19. He probably contracted COVID-19 performing his duty for patients. When he got sick, he checked himself into a hospital where he knows the physicians who are treating him. Now, he’s on a ventilator fighting for his life.
If there was a “cure” for COVID, I choose to believe that my brother and/or his team of physicians would have used it. To think otherwise would condemn Frank and millions of other physicians in this country. They would be endangering themselves and their patients by refusing to implement a simple remedy.
I’m not a doctor. I’m not a researcher. I have no way of personally knowing whether hydroxychloroquine helps to fight COVID. But, I know a lot of physicians and I’ve been talking to them regularly as Frank has fought this virus. None of them has suggested hydroxychloroquine would help. And, some of them have explicitly said that it won’t help. If I contract this disease, I’m going to place my life in their hands and follow their treatment.
Please, reach your own conclusions. If you have physicians who are friends, talk with them. To me, they are the best source of information. I’m not qualified to know which studies on the internet are trustworthy. (You may even review my timeline and see that I jokingly shared a link with some friends, who love Korean food, touting the remedial benefits of kimchi. It was later pulled by Facebook for spreading false information.) Instead, I am relying upon my known, trusted sources of information to reach my conclusion.
If you reach the conclusion that hydroxychloroquine can provide benefits in treatment, I support you one-hundred-percent. But, please, also try to determine if hydroxychloroquine is a “cure” for COVID-19. Figure out if there is a need for social distancing. Is there is a need to wear a mask in public?
