Today’s blog entry deals with the question of whether title I of the ADA applies to foreign flagged cruise ships. We know that under this case, Spector v. Norwegian Cruise Lines, title III of the ADA applies to foreign flagged cruise ships under some circumstances. However, this is a title I case. It’s a really interesting question. So, I thought it would be worth exploring here. The decision is from the Southern District of Florida decided on June 5, 2020. The case is Schultz v. Royal Caribbean Cruises, Ltd. It is actually a seventy-seven page decision, but we will break it down to more manageable levels. As usual, the blog entry is provided into categories and they are: facts; court’s reasoning extra territoriality; court’s discussion of Supreme Court precedent; court’s reasoning on how do you determine location of a plaintiff’s employment; court’s reasoning on the conflict with foreign laws exception; court’s reasoning on proving up an ADA claim; court’s reasoning on did the plaintiff have a disability; court’s reasoning on whether plaintiff is qualified; court’s reasoning on pretext; and my take on Spector and thoughts/takeaways. Of course, the reader is free to concentrate on any or all of the categories.
Plaintiff, a thirty-three year old Wisconsin resident and U.S. citizen, is an opera singer who applied for employment as part of an opera program onboard the Azamara Journey. The vessel was scheduled to embark on a fourteen-week voyage from Singapore to Stockholm on March 25, 2018 to June 29, 2018. Defendant gave Plaintiff a job offer with a condition that Plaintiff successfully completes a pre-employment medical examination (“PEME”) under the guidelines of the International Labour Organization (“ILO”).
The examining physician completed a form noting that Plaintiff was fit for duty at sea despite a history of depression and anxiety. However, the physician also included a note that Plaintiff needed psychiatric clearance. A reviewing doctor, a physician at Broward Health, agreed with that assessment and recommended that Plaintiff undergo a psychiatric evaluation. Defendant then informed Plaintiff that he needed to obtain a psychiatric evaluation that would address his history of depression, his current mental status, and his fitness for duty at sea.
To comply with this request, Plaintiff arranged a video session with his former treating psychiatrist, Dr. Bernard Gerber (“Dr. Gerber”). Dr. Gerber wrote a letter, following the session, that Plaintiff was mentally fit for duty at sea. Dr. Gerber also stated that, although Plaintiff suffered from major depression since the age of 9 and survived a prior suicide attempt, Plaintiff had been in remission with the help of medication and psychotherapy. Dr. Gerber found that that there was little to no risk of harm to Plaintiff or others and that the risk of suicidal ideation was low.
Defendant’s chief medical consultant, Dr. Benjamin Shore (“Dr. Shore”), then reviewed Plaintiff’s medical file in March 2018. This included a review of Plaintiff’s disclosures on his medical forms and Dr. Gerber’s letter. Based on this information, Dr. Shore concluded that Plaintiff was not fit for duty at sea under the applicable ILO guidelines because of Plaintiff’s history of major depression. More specifically, Dr. Shore found that Plaintiff’s depression was persistent or reoccurring within the meaning of the ILO guidelines because Plaintiff continued to receive treatment for depression in the form of psychotherapy and medication. Dr. Shore also determined that he could not exclude the possibility that Plaintiff’s major depression would reoccur if Plaintiff were on a cruise ship for an extended period without access to medical services. Based on Dr. Shore’s assessment, Defendant withdrew its employment offer and Plaintiff filed this action seeking relief under the ADA and the FCRA.
Finally, as we will see below, prior to the conditional job offer being withdrawn plaintiff had spent two months rehearsing in Florida and being paid for same.
Court’s Reasoning Extra Territoriality
- A long-standing principle of American law is that unless a contrary intent of Congress appears, any legislation is meant to apply only within the territorial jurisdiction of the United States.
- Where a foreign flagged vessel is operating in U.S. waters, that foreign flagship sailing in the U.S. waters is not extraterritorial. Under Spector, U.S. laws are presumed to apply if the interests of the United States or its citizens rather than the interest internal to the ship are at stake.
- Absent a clear statement of congressional intent, general statutes do not apply to foreign flagged vessels insofar as they concern matters involving only the internal order and discipline of the vessel rather than the peace of the port.
- If the failure to hire plaintiff intruded upon the internal affairs of a foreign flagged vessel, then a clear congressional statement is necessary in order for title I of the ADA to apply.
- Title I of the ADA does not have such language in it. Rather, there is only a general statement that the law applies extra territorially.
Court’s Discussion of Supreme Court Precedent
- Spector v. Norwegian Cruise Lines Limited held that a clear congressional statement is required for U.S. law to apply to foreign vessels operating in domestic waters when the law implicates the internal order of the foreign vessel rather than the welfare of American citizens.
- U.S. laws are presumed to apply to foreign vessels operating in U.S. waters unless the law implicates the internal order of a vessel. If it doesn’t implicate the internal order of the vessel, only then is explicit congressional intent required.
- Plaintiff never made it onboard a seagoing vessel. Rather, plaintiff complains of a vessel’s employment practices under the ADA taking place entirely on U.S. soil. That is, plaintiff, a U.S. citizen, was denied employment before he ever boarded a foreign vessel in international waters.
- In the 11th Circuit, the internal affairs doctrine generally has been applied where application of American law interferes with relations between the ships foreign owner and the owner’s foreign born crew, which isn’t the case here. The Florida Supreme Court has said the same.
- It is reasonable to assume that Congress intended a statute to apply to entities in U.S. territory serving, employing, or otherwise affecting American citizens, or that affect the peace and tranquility of U.S. even where those entities happen to be foreign flagged ships.
- Spector enforced the ADA against a foreign flagged vessel doing most of its business in and from from the United States.
- Spector never considered the question of whether the physical barriers at issue in the case interfered with the ship’s internal affairs. Instead, it remanded the question to the Fifth Circuit.
- In a footnote, the court noted that the Second Circuit has found that title VII, the ADA, and the ADEA all apply to a foreign company’s domestic operations. The Second Circuit also noted that U.S. subsidiaries of foreign corporations are generally subject to U.S. antidiscrimination laws, and absent treaty protection, U.S. branch of a foreign corporation is not entitled to immunity not enjoyed by such subsidiaries.
- What is the location of the plaintiff’s employment becomes critical in trying to figure out whether title I of the ADA applies.
Court’s Discussion of How Do You Determine Location of a Plaintiff’s Employment
- One possible test is the primary workstation test. The primary workstation test focuses on the place where the work is actually performed disregarding other factors, such as the location where plaintiff is hired or trained.
- The primary workstation test is vague and overly simplistic in this case for several reasons: 1) plaintiff never made it onboard a foreign flagged vessel; 2) it may or may not matter if a plaintiff worked in conjunction with a third party and whether time spent working on U.S. soil outweighs a future working relationship abroad that never materialized; 3) the primary workstation test never dealt with the situation involving employment in the United States; 4) and the primary workstation test cases neither contemplated a plaintiff first working in the United States nor contemplated the situation where employment overseas was intended to be temporary.
- Another test is the center of gravity test. That test takes into account the entire employment relationship between a plaintiff and an employer.
- The center of gravity test involves looking at several factors, including: 1) had any employment relationship in fact been created at the time of the alleged discrimination; 2) if so, where was that employment relationship created and where were the terms of the employment negotiated; 3) the intent of the parties concerning the place of employment; 4) the actual or contemplated duties, benefits, and reporting relationship for the position at issue; 5) the particular locations where the plaintiff performs those employment duties and receive those benefits; 6) the relative duration of the employee’s assignments in various locations; 7) the domicile of the parties; and 8) the place where the allegedly discriminatory conduct took place. The list is not exclusive. The center of gravity is determined based upon the totality of the circumstances.
- In looking at the factors for the center of gravity test, the following conclusions are reached: 1) the employment relationship was created in Florida when the defendant gave plaintiff a conditional job offer; 2) the terms of the employment relationship are also tied to the U.S. as a result of an addendum added to the contract by the defendant; 3) the terms of the employment relationship were decided in the U.S.; 4) while the parties intended plaintiff to be trained and to attend rehearsals in the United States, they also anticipated plaintiff to be an opera singer in international waters and to report to a vessel owner while on the high seas; 5) U.S. is the only location where the plaintiff actually performed any duties and received benefits when he rehearsed for two months and received payment of compensation for his services; 6) plaintiff’s domicile is in the U.S. and no evidence existed that plaintiff intended to change that domicile at any time.
- Defendant did not offer a single case where allegations of unlawful conduct occurred solely in the United States where the plaintiff performed any job related duties in the same location, and where a court still found that a plaintiff’s complaint intrudes on the internal affairs of a seagoing vessel.
- Accordingly, defendant has failed to show that the denial of plaintiff’s employment categorically interfered with matters concerning only the ship’s internal operations.
Court’s Reasoning on Conflict with Foreign Laws Exception
- 42 U.S.C. §12112(c)(1) provides that if complying with the ADA would cause a covered entity to violate the law of the foreign country where the workplace is located, then the entity does not have to comply with that particular provision of the ADA.
- Defendant failed to submit any expert opinions on whether compliance with the law of Malta would violate the ADA. In fact, there may not even be a conflict at all because the defendant failed to point to a single provision of Maltese law supporting that a conflict even exists. They also never relied on a single piece of expert testimony on how to interpret and apply Maltese law.
- Defendant failed to reference a case where a court has allowed a party to raise a genuine issue of material fact as to the interpretation and application of foreign law based upon speculation, guesswork, and the absence of any competing expert testimony.
Court’s Reasoning on Proving up an ADA Claim
- Establishing a prima facie case of discrimination for violating the ADA means showing: 1) plaintiff was a person with a disability; 2) plaintiff was qualified to perform the job; and 3) plaintiff was subjected to an adverse employment action because of his disability.
- The burden of proof and the results are different depending upon whether the case involves direct or indirect evidence. Also, convincing mosaic is an independent standard that can be looked at as well. In this case, looking at convincing mosaic is unnecessary because the case is clearly one for indirect evidence and the McDonnell Douglas burden shifting scheme.
- In the 11th Circuit, direct evidence only occurs when there is no other possible intent that could be presumed from the evidence.
- Direct evidence only applies to the question of whether the defendant took the adverse employment action with discriminatory intent and not to the other elements of a prima facie claim.
- If a plaintiff meets the prima facie elements and has direct evidence, that means the case is strong enough to go to the jury.
- This case is clearly a disparate treatment case because it does not involve a neutral policy with a disproportionate effect on people with his medical history.
- Withdrawal of a conditional job offer is an adverse employment action.
Court’s Reasoning on Whether Plaintiff Has a Disability
- A person has a disability under the ADA, 42 U.S.C. §12102(1), if: 1) they have a physical or mental impairment that substantially limits one or more major life activities; 2) a record of such an impairment; or 3) is regarded as having such an impairment.
- Substantially limits, 29 C.F.R. §1630.2(i), refers to whether a person is unable to perform a major life activity that the average person in the general population can perform or is significantly restricted as to the condition, manner or duration under which an individual can perform a particular major life activity as compared to the condition, manner, or duration for which an average person in the general population can perform that same major life activity.
- With respect to the actual disability definition, a person is substantially limited when that individual is unable to perform a major life activity as compared to most people in the general population, and the term gets interpreted broadly in favor of expansive coverage to the maximum extent permitted by the ADA. See 29 C.F.R. §1630.2(j)(1)(i).
- In figuring out whether a substantial limitation on the major life activity exist, you look at: 1) the nature and severity of the impairment; 2) the duration or expected duration of the impairment; and 3) the permanent or long-term impact, or the expected permanent or long-term impact of or resulting from the impairment. Most of the time you do not need to consider medical or statistical evidence to figure that out. See 29 C.F.R. §1630.2(j)(1)(iv)-(v).
- With respect to the record of prong of the ADA, that provision protects an individual with a record of past disability even if that individual is no longer disabled.
- Under the regarded as prong, 42 U.S.C. §12102 (3)(A), that works if a plaintiff can establish that the employer perceived a physical or mental impairment regardless of whether that impairment limited or is perceived to limit a major life activity. A person cannot claim regarded as protection if the impairment is transitory and minor. See this blog entry for example.
- For a regarded as claim to work, a plaintiff has to show that the perceived disability involved a major life activity and that the perceived disability is substantially limiting and significant.
- Since the employer withdrew the offer because of a risk that plaintiff might take his own life, it is the regarded as prong at issue.
Court’s Reasoning on Whether the Plaintiff Is a Qualified Individual
- Whether an individual is qualified under the ADA involves first determining whether the plaintiff satisfied the position’s prerequisites, including sufficient experience and skills, and the adequate educational background, or the appropriate licenses for the job. Then, it becomes a question of figuring out whether the plaintiff can perform the essential functions of the job.
- The EEOC has a seven factor test for figuring out what is an essential function. Essential functions are the fundamental job duties of the employment position and not the marginal ones.
- Plenty of evidence was offered to show that a genuine material issue of fact exists with respect to whether the plaintiff was qualified under the ADA.
Can the Plaintiff Show Pretext on the Part of the Employer
- Employer gets to use the honest belief rule.
- Plenty of evidence exists on both sides to raise a question of fact as to whether the withdrawal of the conditional job offer was due to intentional discrimination v. legitimate safety concerns.
My Take on The Spector Decision And Thoughts/Takeaways
- The court notes that whether the plaintiff prevails on damages depends entirely on whether the internal operations of the ship are involved. Just what are the internal operations of the ship? That, as we will see below, is extremely complicated.
- In Spector, Justice Kennedy said that when it came to physical barriers for persons with disabilities on that ship, such a problem might well go to the internal affairs of the ship because different countries might have different architectural requirements. Justice Thomas believed that the ADA would not be applicable to structural modifications as he believed that would go to the ship’s internal affairs. Justice Ginsburg and Justice Souter believed that internal affairs only came into play where the ADA conflicts with international obligations.
- The Justices in Spector agreed that internal affairs was the line of demarcation for ADA liability. However, a majority could not agree on what that term meant. Also, Spector arose in the context of architectural barriers and not with respect to the employer employee relationship. Accordingly, it’s really difficult to tell how the Supreme Court would attack this case for several reasons. First, obviously the makeup of the court has changed. Second, Spector involved architectural barriers and not employment at all. So, anybody’s guess as to how the Supreme Court might attack this. Certainly relevant to this decision, is going to be the Supreme Court decision in the LGBT cases, which we discussed here, because of the majority’s discussion of but for causation. That is, when it comes to pretext, it is now a brand-new ballgame.
- I fully expect this case to make its way to the 11th Circuit at some point since the case is on the very cutting edge of the ADA.
- If you are going to use the foreign conflict exception to the ADA, expert testimony is critical.
- Depending upon the Circuit, convincing mosaic may be the only standard or a third possibility when it comes to direct or indirect evidence.
- What constitutes direct evidence also varies from jurisdiction to jurisdiction. So, be sure to check on how your jurisdiction be used direct evidence. The jurisdiction’s view of direct evidence will go a long way to figuring out whether a plaintiff will automatically get past a summary judgment motion.
- Direct evidence v. indirect evidence or convincing mosaic only goes to whether a discriminatory intent existed and not to the other elements of a prima facie case.
- To proceed under a regarded as theory, despite what Schultz seem to say all you have to show is the employer perceived a physical or mental impairment.
- I’m not convinced that the plaintiff only satisfied the regarded as prong here. From reading the case, a strong argument seems to exist that the plaintiff satisfied all three prongs of the ADA’s definition of disability.