I promised Jon Hyman of the Ohio Employer’s Law Blog that I would hold down the fort with respect to blogging while he and his family jetted off to Italy for vacation. So, here goes. Today’s case, Reed v. Columbia St. Mary’s Hospital, comes out of the Seventh Circuit, and was decided on February 8, 2019. It is notable in a couple of respects. First, of late, the Seventh Circuit has not been kind to persons with disabilities at all. Second, the case goes into quite a bit of detail discussing the religious exemption to title III of the ADA, which simply doesn’t get a lot of litigation associated with it usually. Finally, it also discusses affirmative defenses and what happens if they are not laid out when they are supposed to be laid out. As usual, the blog entry is divided into categories, and they are: 1) Facts; 2) court’s reasoning discussing affirmative defenses generally; 3) court’s reasoning finding District Court abused its discretion by allowing religious exemption defense; 4) court’s reasoning reversing summary judgment on the Rehabilitation Act claims and failure to accommodate claims; and 5) takeaways. Of course, the reader is free to concentrate on any or all of the categories.

I

Facts

Plaintiff alleged that the hospital failed to accommodate her disability by deliberately withholding from her a device needed for her to speak and discriminated against her by putting her in the seclusion room to punish her. Defendant responded with answers to both the complaint and the amended complaint that at no time raised the religious exemption. In granting summary judgment for the defendant, the District Court held that the hospital did not have to comply with title III of the ADA because of the religious exemption in 42 U.S.C. §12187. It also dismissed plaintiff’s Rehabilitation Act claim finding that the discrimination alleged was not premised solely on her disability.

II

Court’s Reasoning Discussing Affirmative Defenses Generally

  1. 42 U.S.C. §12187 specifically exempts from title III coverage both “religious organization,” and, “entities controlled by religious organization, including places of worship.”
  2. The religious exemption in title III is an affirmative defense because it assumes the plaintiff can prove everything in order to establish her claim, but still loses because of the affirmative defense.
  3. It makes perfect sense for a defendant claiming the title III religious exemption to bear the burden of pleading and proof with respect to its religious control. After all, the facts are ordinarily within the knowledge and control of the defendant.
  4. A defendant’s failure to plead an affirmative defense can result in either a waiver of the defense if the defendant has relinquished it knowingly and intelligently, or it can result in a forfeiture of the defense if the defendant failed to preserve the defense by not pleading it.
  5. The purpose of the pleading requirement for an affirmative defense is to avoid surprise and undue prejudice to the plaintiff by providing for notice and the opportunity to demonstrate why the defense should not prevail.
  6. A defendant remains obligated to act in a timely fashion when it comes to affirmative defenses. Once the availability of an affirmative defense is reasonably apparent, the defendant has the obligation to alert the parties and the court of his intent to pursue that defense. A defendant cannot be permitted to lie behind a log and ambush a plaintiff with an unexpected defense. In that situation, the appropriate thing for a defendant to do is to promptly seek the court’s leave to amend the answer. Failure to do that, risks a finding the defense has been waived.
  7. Many efficiencies are lost when claims or defenses are left out pleadings and a party then attempts to assert them at later stages.
  8. It is the same set of problems that occur when plaintiffs try to raise new theories or claims for the first time when opposing summary judgment. The concerns about unfair surprise and prejudice with non-pleaded affirmative defenses are similar. That is, late assertions of affirmative defenses, including the title III religious exemption defense, make litigation more costly and difficult. It also makes it unfairly difficult for plaintiff to pursue her claims.
  9. The title III religious exemption is based on facts in the defendant’s control and clearly falls within the category of affirmative defenses that must be pleaded.
  10. The fact that a witness possibly alluded to a religious exemption defense being possible, doesn’t mean that the plaintiff was on fair notice that the religious exemption defense was in play. The statement made by the witness is not comparable to a lawyer’s statement that the party intends to assert a defense. The statements by the witness in her deposition did not put the plaintiff on fair notice that the hospital would be asserting the religious exemption and that the plaintiff was going to have to spend the time and money to conduct extensive discovery on whether the hospital can satisfy the ADA’s religious exemption.
  11. The fact that plaintiff knew when she filed the suit that the hospital was at least nominally associated with the Catholic faith is of no help to defendant either. Nominal association tells a plaintiff nothing about the availability of the religious exemption because the statutory test is the control exercised by the religious organization. After all, all kinds of entities have names associated with religions but are not subject to religious control.
  12. With respect to the facts of this case, it turns out that the hospital had two lines of control (Catholic and non-sectarian).

III

Court’s Reasoning Finding District Court’s Abused Its Discretion in Allowing the Religious Exemption Defense

  1. The hospital offered no excuse or explanation for failing to plead the defense in its answers or for raising the defense so late.
  2. Absent a credible excuse for the delay, the hospital’s late invocation of the defense looks like a straight ambush of the plaintiff when it was too late for the plaintiff to put together a comprehensive rebuttal.
  3. The religious exemption defense ordinarily depends on facts within the knowledge and control of the defendant.
  4. The defendant did not deploy this defense until after discovery had closed. That means both parties had already invested a good deal of time and money in the case on the legitimate expectation they knew what the issues were.
  5. Allowing a last-minute defense introduces new factual and legal issues after discovery has closed, adds to the cost of litigation, and allows the party that was at least negligent in failing to plead the defense to take unfair advantage of the opposing party.
  6. The District Court’s rationale for allowing the defense to be used so late doesn’t hold up. Here, a few relevant facts to the affirmative defense came up briefly in one deposition, but that cannot be reasonably treated as fair notice that the hospital would actually assert the defense thereby causing the plaintiff to have to spend time and money needed to meet that defense. Accordingly, the plaintiff was entitled to rely on Federal Rules of Civil Procedure 8(c) requiring affirmative defenses to be pleaded in answers.
  7. It was not the plaintiff’s obligation to raise the defense.
  8. If Rule 8(c) is not to become meaningless, attempts to invoke defenses at the 11th hour, without excuse and without adequate notice to the plaintiff, cannot be tolerated.
  9. The prejudice to the plaintiff from the delayed assertion of the defense is especially problematic here because the relevant law and the facts are not clear.
  10. The ADA does not define what it means to be a religious organization or to be controlled by a religious organization. Further, no federal appellate court has yet analyzed this religious exemption.
  11. With respect to the District Courts analyzing the religious exemption, the issue is very complex on a factual and legal level. What the courts have done is look at the Department of Justice interpretation of its rules in 28 C.F.R. part 36 to try and figure things out. That interpretation says the religious exemption test is a factual one. That is, the focus is on whether the church or other religious organization controls the operations of the school or of the service. That test also focuses on whether the church or religious organization operates the place of public accommodation and not upon the individuals receiving the services of that public accommodation.
  12. Here, the religious exemption defense means assessing a whole bunch of facts that are very much in dispute and need to be explored in some depth. Before summary judgment briefing, the plaintiff had no notice that she needed to prepare to meet that defense.
  13. Where a defendant offers no credible excuse for delay, the normal rule is forfeiture of non-pleaded defenses.
  14. Any reopening of discovery would impose additional delay on the plaintiff, and there are no mitigating factors favoring anything other than treating the defense as forfeited.

IV

Court’s Reasoning Reversing the District Court’s Granting of Summary Judgment on the Rehabilitation Act Claim and on the Failure to Accommodate Claim

  1. Making out a prima facie case for violation of §504 of the Rehabilitation Act involves showing: 1) the plaintiff is a handicapped individual; 2) the plaintiff is otherwise qualified for participation in the program; 3) the program receives federal financial assistance; and 4) the plaintiff must have been denied the benefits of the program solely because of his or her handicap.
  2. The ADA and the Rehabilitation Act are very close to each other in their substance, but the Rehabilitation Act prohibit discrimination only if it is solely by reason of a person’s disability. Whereas, the ADA permits mixed motive claims.
  3. While the Rehabilitation Act does not contain an explicit accommodation requirement, the United States Supreme Court has found a duty to accommodate in the statute generally.
  4. A review of the facts shows that a jury could find that nothing the plaintiff conceded happened would have justifiably led to the hospital taking her to the seclusion room. That is, the material facts leading to the plaintiff being placed in seclusion are very much in dispute. So much so, that a reasonable jury could find that the hospital intentionally discriminated against the plaintiff solely on the basis of her disability.
  5. The court also reversed the summary judgment with respect to the plaintiff’s reasonable accommodation claim finding that the hospital had not argued that the decisions it made were done in the exercise of professional judgment to treat plaintiff’s mental illness.

V

Takeaways

  1. Religious exemption is an affirmative defense. Make sure you plead it in the answer. Failure to do so will likely result in forfeiture of the defense.
  2. Remains to be seen whether the hospital might pursue a malpractice action against its attorneys. After all, it’s possible had the religious exemption defense have been alleged in its answer, the hospital would have gotten a get out of jail free card. Also, the court actually uses the term “negligence,” when discussing the failure to plead an affirmative defense.
  3. If during the course of discovery, it becomes clear to the defense that the religious exemption is in play, be sure to seek leave from the court to amend your answer.
  4. It is entirely possible that a defendant may be aware of the religious exemption defense but for a variety of reasons elects not to pursue it.
  5. Religious exemption affirmative defense claims are very complex factually and legally. The legal complexity may be about to get a whole lot worse with the expected decision from the United States Supreme Court in Kisor (oral argument on that case will take place next week, but the result- getting rid of Auer deference-, is a foregone conclusion, though I could be wrong).
  6. For the religious exemption to apply, nominal association with the religious entity is not going to work.
  7. The religious exemption focuses on the control exercised by the religious organization and not upon the people receiving the services.
  8. The court uses the term “handicapped,” which is a term very much out-of-favor and has been for some time. The better language to use is a person with a disability. 29 U.S.C. §794 (§504 of the Rehabilitation Act), does use the term disability.
  9. The Seventh Circuit acknowledges that causation is different between Rehabilitation Act cases and ADA cases. That causation is different between the Rehabilitation Act and the ADA is something readers of this blog have known for a long time, see here, but it is significant that a Court of Appeals is saying as much.
  10. Prevailing on a religious exemption affirmative defense at the summary judgment stage is going to be very difficult after this case.
  11. In case you are wondering why your place of worship (it is a real problem in the Jewish faith from what I have read), is not accessible to a person with a disability, this blog entry gives you your answer.

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