November 12, 2014

New York Law Journal / Written by: Harvey M. Stone, Peter R. Schlam

This column reports on several significant, representative decisions handed down recently in the U.S. District Court for the Eastern District of New York. Topics include: hostile work environments, expert's fees and fair debt collection practices.

Hostile Work Environment

In Garone v. United Parcel Service, 00 CV 6722 (EDNY, July 12, 2001), Judge I. Leo Glasser dismissed claims of gender discrimination against a UPS employee because his isolated comment to plaintiff did not show a "hostile work environment."

Plaintiff brought this action against UPS and eight UPS employees pursuant to Title VII and related provisions of both the New York State and City Human Rights Laws (NYSHRL and NYCHRL) proscribing hostile work environment and retaliation. Defendant DiMarco moved to dismiss four causes of action against him.

Plaintiff began working for UPS in 1993 as an Office Management Specialist. She alleges that in 1996 and 1997 her supervisor made sexually harassing and derogatory remarks to her. When she complained separately to two UPS managers, they purportedly told her, "Keep quiet, otherwise they will say you are a problem." In September 1997, another supervisor allegedly made sexually harassing remarks to her and she complained to him, but to no avail. Plaintiff complained again, this time to a division manager, in October 1998. He transferred her to another department.

Plaintiff's sole mention of supervisor DiMarco in her 62-paragraph complaint is that in January 1999 he said, "I had better watch what I say in front of you. You might start screaming sexual harassment." The complaint details subsequent acts of retaliation and harassment by other employees, leading to her "constructive discharge" in April 1999.

Judge Glasser agreed with Mr. DiMarco that the one comment attributed to him was not so severe or pervasive as to create a hostile or abusive environment. See, similarly, Trigg v. New York City Transit Authority, 99 CV 4730 (EDNY, July 26, 2001) (Glasser, J.) ("Seabrook's two boorish comments could not conceivably be regarded as anything other than the isolated, sporadic and gender-related utterances of an intolerant, narrow-minded man"). Nor was the court persuaded by plaintiff's contention that, under the "totality of circumstances," Mr. DiMarco was "complacent" about the harassment and therefore liable. The "totality of circumstances inquiry," the court noted, is relevant to the issue of employer liability for discrimination. E.g., Harris v. Forklift Systems, Inc., 510 U.S. 17 (1993). By contrast, the issue here was the liability of an employee in his individual capacity under New York State and City law. As Judge Glasser observed:

[Plaintiff] attempts to transform the innocuous into the sinister by arguing that DiMarco is liable for his "complacency" and "perpetuation of harassment" based on the acts of UPS and other individual defendants. (Slip op. 4).

In the court's view, Mr. DiMarco's alleged remark was arguably not even an offensive utterance that altered the conditions of plaintiff's employment. In this regard, Judge Glasser pointed to the Supreme Court's advice to the lower courts to be cognizant of the realities of human interaction: "Common sense, and an appropriate sensitivity to social context, will enable courts and juries to distinguish between simple teasing or roughhousing ... and conduct which a reasonable person in the plaintiff's position would find severely hostile or abusive." Oncale v. Sundowner Offshore Services, Inc., 523 U.S. 75, 82 (1995).

After next rejecting plaintiff's retaliation claims, Judge Glasser considered plaintiff's attempt to hold Mr. DiMarco individually liable as an "aider and abetter" of discriminatory practices under NYSHRL and NYCHRL. Though, as Judge Glasser discussed, the reported decisions dealing with this theory are not entirely consistent with each other, plaintiff could not prevail under any of the applicable cases. This is because (a) there are no allegations in the complaint that Mr. DiMarco had any ownership interest in UPS or otherwise had authority to make personnel decisions about her; and (b) Mr. DiMarco's single comment can hardly amount to "active participation" in the discriminatory conduct of others.

Expert's Fees

In Aiello v. Town of Brookhaven, 94 CV 2622 (EDNY, July 5, 2001), Judge Frederic Block redirected the Town to pay the entire fee of a court-appointed expert rather than apportioning the fee among the parties.

In a prior decision dated March 14, 2001 (reported in this column, The New York Law Journal, April 13, 2001, p. 3), Judge Block found the Town liable under the Resources Conservation and Recovery Act for contaminating waters abutting plaintiffs' properties. The court also assessed the full cost of the court-appointed expert to the Town and required the Town to object to the amount of the expert's invoice within ten days.

Instead, the Town objected to the assessment of fees entirely to the Town, but submitted no documentation to support its contention that the fees were excessive. The court treated the Town's objection as a motion for reconsideration, but adhered to its prior decision and gave the Town an additional opportunity to contest the amount of the fees.

Judge Block rejected the Town's contention that the expert should not be paid until after final judgment. It would be unfair, the court said, to make the expert, who was appointed in connection with the issue of liability, to wait any longer for payment. Next, the court reviewed the four factors underlying its decision to assess all the expert's fees to the Town: (1) the nature of the case, which involved ordinary citizens seeking to protect the environment; (2) the unequal status of the parties, with a well-funded government as violator pitted against working-class people living in modest homes with limited financial resources; (3) the Town's suspect behavior, which led the court to seek its own expert; and (4) the financing of the litigation by Town taxpayers, including plaintiffs. These factors, Judge Block explained, justified apportionment of the entire expert's fees to the Town. Finally, the court determined that no constructive purpose would be served by requiring plaintiffs to submit financial data demonstrating their inability to pay, since such a requirement would result in unneeded litigation.

Debt Collection

Fair Debt Collection Practices Act. In Arroyo v. Solomon & Solomon, P.C., 99 CV 8302 (EDNY, July 19, 2001), Judge Allyne R. Ross granted summary judgment on liability to plaintiff Valerie Tranumn on her claim that defendant, a law firm, violated her rights under the Fair Debt Collection Practices Act (FDCPA) by making false and misleading statements in connection with debt collection.

Plaintiff executed a promissory note for a student loan that was reinsured by the Department of Education under the Higher Education Assistance Act (HEAA). Plaintiff defaulted on the loan. The Department of Education reimbursed the guarantor bank under its reinsurance agreement and referred the loan to the Department of Justice for collection. Defendant contracted with DOJ to collect the debt. Defendant insisted that plaintiff make payments of $150 per month for three years to pay off the loan, even after plaintiff stated that she could pay only $15 to $20 per month.

The court held that defendant provided false and misleading information by failing to inform plaintiff that under the FDCPA she was required only to make monthly payments that were reasonable and affordable in light of her financial circumstances. As Judge Ross noted, defendant repeatedly failed to inform plaintiff of her right to make reasonable and affordable payments under the HEAA, starting with the initial collection notice and continuing through numerous telephone conversations.

Judge Ross rejected defendant's contention that the DOJ and defendant were not bound by the HEAA because the statute does not specifically refer to the DOJ. To the contrary, given the HEAA's purpose of encouraging student loans, restriction of collection efforts would be meaningless if all the Department of Education had to do to avoid them was to refer a case to the DOJ for collection. Slip op. 9.

The court also rejected defendant's "bona fide error" defense under the FDCPA because "mistakes of law or reliance on erroneous legal advice cannot form the basis of a bona fide error defense." Slip op. 11. Moreover, defendant's error in informing plaintiff that she would be required to repay the loan in full within three years resulted from an established policy, not an unintentional error.

Magistrate Judge Pro Se Cases. In Shareholder Glendora v. Lemle, 99 CV 0922 (EDNY, July 10, 2001), Judge Reena Raggi granted the United States Attorney's motion to dismiss a frivolous suit against a number of judges, two Pretrial Services Officers and several other "federal defendants" on grounds of absolute immunity, but denied the motion for an order barring plaintiff from filing additional civil actions of any kind without prior leave of the court.

No Broad Relief Needed

As Judge Raggi noted, the factors relevant to an application to bar additional civil actions including plaintiff's "well-established reputation for vexatious and often unintelligible filings" "weigh heavily" against her. Nevertheless, there was no need at this point for such broad relief. Judge Raggi explained:

. . . the Board of Judges has recently selected a magistrate judge, Lois Bloom, who will focus primarily on pro se cases. As a part of her routine review of newly filed cases, the magistrate judge will issue orders to pro se litigants who file seemingly frivolous claims directing them to show cause why their suits should not be dismissed. This procedure should minimize, if not totally eliminate, the burden on adversaries that was endured by the federal defendants in this case. Should this process prove inadequate to deter vexatious filings by [plaintiff] or any other litigant, the magistrate judge can certainly recommend more stringent limitations. (Slip op. 8).

Peter R. Schlam and Harvey M. Stone are partners at Schlam Stone & Dolan. Bennette D. Kramer, a partner of the firm, assisted in the preparation of the article.

[Reproduced with permission from New York Law Journal Volume 226, Friday, August 10, 2001.  Copyright 2001 ALM Properties, Inc.  All rights reserved.]