Before getting started on the blog entry for the week, I want to wish those who are celebrating a happy and healthy Jewish new year. The new year starts this evening and culminates with the day of atonement next week.

 

The case of the week is Granas v. Union Pacific Railroad Company out of United States District Court for Oregon, here. It discusses what happens when an employer has an inflexible return to work rule, and imposes permanent restrictions without engaging in an individualized analysis. The result is an award of $$952,863 in front as well as back pay and $25 million in punitive damages. As usual, the blog entry is divided into categories and they are: facts; key points revealed through trial; court’s view of compensatory damages; court’s view of punitive damages; court’s review of front pay and back pay under the ADA; and thoughts/takeaways. Of course, the reader is free to concentrate on any or all of the categories.

 

I

Facts (greatly condensed).

 

  1. Ideal plaintiff (moved to area as a child and had to raise himself; served 20 years in the United States Army; worked for Union Pacific for 16 years as a conductor and brakeman; two kids and six grandchildren; built a ranch from scratch).
  2. Injured (dislocated shoulder),while loading a hay wagon on his ranch on his 55th However, received physical therapy, worked a variety of different jobs, and was even stronger than he was before injury. His doctor gave him a release to return to work without restrictions.
  3. Since 2016, Union Pacific has a 1% rule whereby a person is given a permanent restriction of not being able to work in what it calls a safety sensitive job if the person has a 1% chance of reinjuring themselves. The rule was informal and not in writing but nevertheless enforced.
  4. Union Pacific did not engage in an individualized analysis as to whether the plaintiff was a direct threat to self or others or whether he could do his job with the without reasonable accommodations. The 1% rule is absolutely inflexible.

 

II

Key Points Revealed through Trial

 

  1. Expert testimony put on by the plaintiff from a doctor with a great deal of expertise in fitness for duty examinations, explained: 1) when determining whether an employee is fit for duty, a decision-maker needs to understand the nature and components of the job and assess the particular individual in light of their circumstances and medical facts; 2) it is not medically professional to exclude a person from returning to their occupation on the basis of a shoulder dislocation alone without a more individualized evaluation of the employee’s ability to perform the duties of the job; 3) there is no medical basis for the 1% rule or for determining the method by which a 1% rule would apply to a shoulder injury. That is, nothing found in the medical literature or standards that are published suggesting the 1% rule was appropriate under the circumstances of this case or how it was calculated for the plaintiff. In short, no scientific or medical basis exists for applying the 1% rule to terminate the plaintiff; 4) the 1% rule was not uniform across the industry and was an outlier; 5) Union Pacific did not contact any of plaintiff’s treating doctors or therapists and did not obtain his full medical record; 6) Union Pacific did not have a complete picture of plaintiff’s shoulder injury or the status of his rehabilitation; 7) Union Pacific did not do any particular analysis of plaintiff as a person; 8) Union Pacific did not have the plaintiff physically examined; 9) Union Pacific did not seek to discover how successful plaintiff’s rehabilitation was; 10) Union Pacific did not request plaintiff to provide evidence of an MRI to confirm any questions that it might had nor did it bring him to the train yard to perform a physical function test; 11) Union Pacific did not contact any of his treating doctors; 12) Union Pacific should have taken a harder look at the plaintiff as an individual rather than apply the 1% rule to dismiss him; 13) Union Pacific did not follow the medical literature with respect to the plaintiff’s particular injury, which actually showed a lower risk of injury for the plaintiff than for someone much younger; and 14) it is not a best practice to use a uniform, blanket policy to screen out from working as a trainman all employees who had ever had an anterior shoulder dislocation.

 

III

Court’s View of Compensatory Damages

 

  1. Since losing his job, plaintiff had not had the income necessary to pay for the costs to sustain his ranch, which also caused him a great deal of emotional distress.
  2. Losing his job had caused him serious emotional distress and necessitated a completely different financial situation.
  3. It is more probable than not given the evidence for need of income for the ranch and plaintiff’s overall good health, strength, and energy, that plaintiff would have retired at the age of 67 with a full pension. As a result, plaintiff’s total economic net loss for past, present, and future earnings reasonably calculated to be $952,863 with the back pay portion of that being $443,014.

 

IV

Court’s View of Punitive Damages

 

  1. Union Pacific has revenue of $24.3 billion and net income of $6.7 billion in 2024 with $18.5 million a day in profit.
  2. Union Pacific is a sophisticated company aware of unlawful employment practices under the ADA.
  3. Plaintiff’s expert discussing fitness for duty and how they are supposed to work was absolutely critical. Companies would do well to pay attention to that testimony described in this opinion.
  4. To recover punitive damages under the ADA, plaintiff must show that the defendant engaged in a discriminatory practice or discriminatory practices with malice or with reckless indifference to her federally protected rights. That means showing that an employer must at least discriminate in the face of a perceived risk that its actions will violate federal law. In general, intentional discrimination is enough to establish punitive damages liability.
  5. The unanimous jury determined by preponderance of the evidence that Union Pacific intentionally discriminated against the plaintiff based on disability and that it did so with the knowledge that its conduct would likely violate the ADA.
  6. Unanimous jury also determined by the preponderance of the evidence, that Union Pacific’s 1% policy was an unlawful screening policy tending to screen out individuals with disabilities, including the plaintiff.
  7. By a preponderance of the evidence, the court determined that Union Pacific’s 1% policy was unlawful and that it screens out or tend to screen out individuals with disabilities, such as the plaintiff. Union Pacific also excluded the plaintiff from returning to his job because of his injury regardless of his individual condition, which showed that it was more likely than not that had Union Pacific had done an individualized analysis, it would have concluded that plaintiff could return to his job. It didn’t do that and fired the plaintiff based on the 1% policy.
  8. Abundant evidence at trial exists concluding that it was more likely than not that Union Pacific: 1) was aware of antidiscrimination principles and that its policy was facially discriminatory; 2) the policy was directed at employees with a certain medical diagnosis; and 3) Union Pacific used the policy to restrict those employee from work or returning to work. Accordingly, sufficient evidence exists to support a finding that Union Pacific had sufficient malice, or reckless and outrageous indifference to a highly unreasonable risk of harm and acted with a conscious indifference to the health, safety, and welfare of others so as to support an award of punitive damages.
  9. For the same reasons, punitive damages under Oregon State law are justified.
  10. Since the lawsuit also involved Oregon law, the court is free to allocate damages between the federal and state law so as to avoid the federal statutory damages cap.

 

V

Court’s Review of Back Pay and Front Pay under the ADA

 

  1. The Ninth Circuit has held that backpay is an equitable remedy with the court and not the jury having the ultimate discretion regarding the amount of the award. Accordingly, backpay is not subject to the damages cap.
  2. Front pay is a remedy previously authorized under the Civil Rights Act. Congress did not limit the availability of such awards. Instead, Congress expanded the available remedies by permitting the recovery of compensatory and punitive damages in addition to previous available remedies, such as front pay.
  3. The Supreme Court has held that front pay is not an element of compensatory damages within the meaning of the Civil Rights Act. The Supreme Court has said that front pay is a remedy authorized under prior law, so the statutory damage is inapplicable to front pay.
  4. The statutory damage cap applies to punitive damages and compensatory damages, but not backpay or front pay.
  5. The jury’s award is supported by a preponderance of evidence on the record, and departing from the jury’s intent would be impermissibly disregarding those findings.

 

VI

Thoughts/Takeaways

 

  1. From looking at the docket, it looks like that this case may be appealed. As of this writing, plaintiff is in the process of trying to obtain an order specifying the attorney fees plaintiff is entitled to.
  2. Ideal plaintiff
  3. A policy that screens out people with disabilities is a terrible idea. Any inflexible rule results in screening out persons with disabilities.
  4. If you have return to work policies, it should be backed up by medical evidence supporting that policy.
  5. The ADA always requires an individualized analysis. Failing to do that can cost you big time as it did in this case.
  6. Front pay and backpay are not subject to the statutory damages cap per this decision.
  7. Filing under state and federal law claims simultaneously may be a vehicle to enable a plaintiff to get around the statutory damages cap with respect to compensatory and punitive damages.
  8. Intentional discrimination is generally enough to establish punitive damages liability.
  9. Not every legal counsel is knowledgeable about the ADA. Be sure knowledgeable ADA counsel gets involved when necessary. As readers of this blog know, the ADA in every one of its titles is enormously complex.
  10. Unless you are talking about exquisite federal regulation talking about safety sensitive jobs, “safety sensitive,” is not a thing (unless you are talking about the burden of proof), under the ADA. Instead, the question is whether the person with a disability is a direct threat to self or to others per Chevron v. Echazabal, which we have discussed many times in the blog, such as here.