2024 saw several important decisions rendered by the Supreme Court of the United States. In this 5 part series, we take a look at some key decisions and the cases that led to those decisions. These are the case summaries decided by SCOTUS that most affect our clients and the courts in which we practice. Case summaries were prepared by Christian & Small summer law clerks Katie Applebaum and Eric Posas along with Partners Sharon D. Stuart and Bill D. Bensinger.
Part 5: Employment and Public Accommodations
Acheson Hotels v. Laufer, 601 U.S. 1 (decided 12/5/23) – ADA “tester” case
The Supreme Court vacated and remanded a decision for mootness concerning whether a “tester” plaintiff may sue an establishment that she does not intend to patronize.
Plaintiff Deborah Laufer, who suffered physical disabilities and vision impairments, sued Acheson Hotels and hundreds of other hotels for failing to publish information about their accessibility on their website, which is required under the Americans with Disabilities Act (ADA). Laufer was considered a “tester” plaintiff, that is, a person who seeks to identify violations but does not necessarily intend to visit or patronize the business which is being investigated. The District Court found that Laufer lacked standing to sue because she had no plans to visit the hotel and thus suffered no injury. The trial court accordingly dismissed the suit. The First Circuit, however, reversed and determined that Laufer’s lack of intent to book a room at the defendant hotel did not negate the fact of injury. Laufer “singlehandedly generated” a circuit split: the Second, Fifth, and Tenth Circuits held that she lacks Article III standing; the First, Fourth, and Eleventh Circuits held that she has it. However, the issue of standing was not determined by the Supreme Court, because Laufer voluntarily dismissed her pending suits with prejudice, including her complaint against Acheson.
Justice Barrett, writing for the majority, declared the case moot and vacated the judgment. Barrett determined that Laufer’s voluntary dismissal of her suit against Acheson after a lower court sanctioned her lawyer was not evidence of an effort to evade review. Although the Court was sensitive to the defendant’s concerns over settling the circuit split, it reserved its discretion to hear the issue later. Justice Thomas and Justice Jackson both filed concurring opinions. Justice Thomas argued that the Court should hear the standing issue and argued that Laufer does not have standing under Article III. Justice Jackson disagreed with the decision to vacate the judgment.
Unfortunately, there is no resolution of the “tester” question due to the mootness ruling. And, if Laufer sticks with her decision to refrain from suing hotels, it is possible that this specific question will not arise again. For now, plaintiffs may prevail on ADA claims in which they have not visited and do not intend to visit the defendant establishments. There are concerns about similar “tester” plaintiffs in the First, Fourth, and Eleventh Circuits, where precedent exists allowing this behavior.
Muldrow v. St. Louis, 144 S. Ct. 967 (decided 4/17/24) – Title VII transfer decisions
The Court held that a Title VII claimant must show some harm arising from her forced transfer, but she does not need to satisfy a heightened significance standard to prove her claim.
Sergeant Jatonya Clayborn Muldrow filed a Title VII claim against her employer, the St. Louis Police Department, after the Department transferred her to a uniformed job in the Fifth District. Prior to the transfer, Muldrow served as a plainclothes officer within the Department’s specialized Intelligence Division ¬– a role which afforded numerous perks including FBI credentials and a traditional Monday-through-Friday work schedule. Captain Michael Deeba transferred Muldrow out of the Intelligence Division and into the Fifth District against her wishes. Deeba testified that a male police officer seemed a “better fit for the Division’s ‘very dangerous’ work.” Muldrow’s rank and pay remained the same, but she lost the perks of her previous job.
Muldrow filed a Title VII claim against the City of St. Louis, arguing that the City “discriminate[d] against” her on the basis of sex “with respect to the terms [or] conditions” of her employment. Muldrow claimed she lost both career opportunities and material benefits because of the forced transfer. The District Court granted summary judgment for the City, citing Circuit precedent that required Muldrow to show that her transfer resulted in a “significant” change in working conditions which produced a “material employment disadvantage.”
In a unanimous decision, the Court vacated and remanded the judgment. Justice Kagan asserted that nothing in the anti-discrimination provision in the workplace discrimination statute establishes an additional burden on the plaintiff to prove significant harm. 42 U.S.C. § 2000(e)-2(a)(1). The Court rejected the City of St. Louis’s arguments based on statutory interpretation, precedent, and policy. An employee must still prove that 1) her employer discriminated against her on the basis of a protected classification, 2) the injury concerns the terms or conditions of her employment, and 3) some harm occurred as a result of the action. The Court concluded that the lower courts erroneously granted summary judgment in favor of the City and found that Muldrow suffered at least some injury as a result of the forced transfer.
Muldrow v. St. Louis lowered the standard by which Title VII plaintiffs must prove a discrimination claim. With this opinion, the Court marked a distinct shift from the requirement of the adverse employment action prong of the prima facie workplace discrimination claim. The Court altered the employment law landscape by merely requiring the claimant to show some harm resulting from a discriminatory action relating to the terms or conditions of the plaintiff’s employment. Because the adverse employment prong requiring a “material” or “significant” standard of harm was so pervasive throughout the field of employment law, many jurisdictions will need to alter or completely change their analysis of Title VII to be in accord with the Supreme Court in this opinion.
Starbucks v. McKinney, 144 S. Ct. 1570 (decided 6/13/24) – NLRB test on requests for injunctions
The Supreme Court clarified that district courts must apply the traditional four factors articulated in Winter v. Natural Resources Defense Council, Inc., 555 U.S. 7 (2008), when considering the National Labor Relations Board (NLRB)’s requests for a preliminary injunction under § 10(j).
Petitioners were Starbucks employees who filed charges against Starbucks with the NLRB. The complaint alleged that Starbucks violated the National Labor Relations Act (NLRA) by engaging in “unfair labor practice[s].” 29 U.S.C. §§ 158 (a), (b). The Board investigated the claim and issued a complaint against Starbucks. The regional Director then filed a § 10(j) petition in the United States District Court for the Western District of Tennessee, seeking a preliminary injunction. A § 10(j) petition authorizes a federal district court “to grant… such temporary relief… as it deems just and proper” during the pendency of the Board’s administrative proceedings. § 160(j).
The District Court applied the two-part test established by Sixth Circuit precedent in deciding whether the Board was entitled to a preliminary injunction. This test simply asked whether “there is reasonable cause to believe that unfair labor practices have occurred,” and whether injunctive relief is “just and proper.” McKinney v. Ozburn-Hessey Logistics, LLC, 875 F. 3d 333, 339 (2017) (internal quotation marks omitted). The Sixth Circuit affirmed. The Supreme Court granted certiorari to decide which test should be applied when deciding a § 10(j) petition.
The Court vacated and remanded the judgment, declaring the four-part criteria identified in Winter to guide § 10(j) decisions. This default rule is that a plaintiff seeking preliminary injunction must make a clear showing that “he is likely to succeed on the merits, that he is likely to suffer irreparable harm in the absence of preliminary relief, that the balance of equities tips in his favor, and that an injunction is in the public interest.” Winter, 555 U.S. at 22. In Justice Thomas’s view, the Winter test fits squarely with the “strong presumption that courts will exercise [the authority to grant equitable relief] in a matter consistent with traditional principles of equity.” Section 10(j)’s statutory directive to grant injunctive relief when the district court “deems” it “just and proper” invokes the discretion that courts have traditionally exercised when faced with requests for equitable relief. Therefore, absent a clear command from Congress, courts must adhere to the traditional four-factor test articulated in Winter when deciding a § 10(j) petition.
By upholding the Winter test, the Court placed a heightened burden on the plaintiff to prove that her claim has substance. This decision also benefits employers due to the certainty that the NLRB will be subject to a uniform standard across jurisdictions when seeking the relief of a preliminary injunction from a federal court. However, the Starbucks v. McKinney decision may result in a slow resolution of disputes under the NLRA due to the protracted administrative review.
Part 1: Federal Arbitration/Federal Agency
Part 2: Bankruptcy/SEC Sarbanes Oxley
Part 3: Social Media
Part 4: Whistleblowers, Preemption, and Choice of Law
Sharon D. Stuart is a founding partner of Christian & Small and has been with the firm since 1993. She devotes her practice to civil trial work and arbitration. She focuses on complex commercial and insurance litigation, and she handles a variety of pharmaceutical and medical device products liability litigation as national, regional or local counsel. Sharon’s trial experience includes a wide range of business tort claims, contract disputes, commercial and insurance fraud and bad faith suits, and wrongful death cases. She has defended dozens of class action lawsuits in areas as diverse as product liability/toxic tort, financial products, insurance, and employment law.
Bill D. Bensinger focuses his practice on commercial dispute litigation, bankruptcy and restructuring litigation. He represents creditors, franchisors, landlords, unsecured creditors’ committees and financial institutions in a wide variety of matters, including preference and avoidance actions, workout transactions and insolvency matters. Bill represents franchisors in bankruptcy, including matters concerning the assumption of franchise agreements, and represents landlords in bank matters concerning the assumption of commercial leases.
Contributors Katie Applebaum and Eric Posas, Christian & Small Summer Law Clerks
About Christian & Small
Christian & Small LLP represents a diverse clientele throughout Alabama, the Southeast, and the nation with clients ranging from individuals and closely held businesses to Fortune 500 corporations. By matching highly experienced lawyers with specific client needs, Christian & Small develops innovative, effective, and efficient solutions for clients. With offices in Birmingham, metro-Jackson, Mississippi, and the Alabama Gulf Coast, Christian & Small focuses on the areas of litigation and business, is a member of the International Society of Primerus Law Firms, and is a Mansfield Rule™ Certified Plus Law Firm. Our corporate social responsibility program is focused on education, and diversity is one of Christian & Small’s core values. Please visit www.csattorneys.com for more information.
No representation is made that the quality of legal services to be performed is greater than the quality of legal services performed by other lawyers.