Labor & Employment Litigation Award
Mary Welch, Daily Report
Every day Lisa ("Lee") Schreter goes to her Buckhead office and plays an "elaborate game of Whac-A-Mole."
Schreter, chairman of the board and co-chairman of the wage and hour practice group at Littler Mendelson, says she and her team "are ready and waiting for wherever we think they [opposing counsel] are going to pop up—and then it's Whac-A-Mole."
The strategy involves "looking for the earliest out," says Angelo Spinola, shareholder. "Our clients love it. We collaborate with our clients, we're invested in their results and we win cases."
Littler Mendelson, which won the Daily Report's Litigation Department of the Year Award for Labor & Employment, nationally has 166 litigation partners and 232 litigation associates. For 2013, the litigation department accounted for 39.29 percent of the firm's 2013 revenue.
To Schreter, there are two ways to approach a case: backward and forward. "If you look backward you work with the claims as they are defined. You can look forward and shape the evidence, change or challenge the facts, and sometimes you can develop the case differently. We don't want to be defined by what happened in the past. We want to see if we can shape it to make it a better risk and a better consequence for our client."
An example of this is Cavallaro v. UMass Memorial Healthcare, where Schreter, Spinola and colleague Brad Strawn led a team that not only resulted in a win for the largest hospital system in central Massachusetts, but also set precedent.
The system was swallowed up in a wave of class actions descending on hospitals. The suits were initiated by aggressive plaintiffs counsel who filed simultaneous complaints in state and federal courts seeking relief under the Fair Labor Standards Act (FLSA), Employee Retirement Income Security Act (ERISA), Racketeer Influenced and Corrupt Organizations Act (RICO), state wage and hour laws and what the Littler team calls a "veritable kitchen's sink of common-law claims."
"I love having the ability to create creative and unique arguments on complex issues," says Spinola. "We'll be the aggressor and set them back on their heels. We were able to push the agenda and drive the case. I love having the opportunity to add something to the client's case or do something that's never been done before."
In this situation, UMass retained Littler. The firm warned the hospital system as well as another hospital system in Massachusetts that they were at risk for being sued. "UMass Memorial Healthcare is a good example," says Schreter. "The client retained us and Angelo and I worked
on that case together. There was a law firm involved that we knew had been filing other cases. In fact, we had actually spoken to the client before the law suit was filed. They were one of a number of clients that we had spoken to say that this law firm is going up and down the East Coast suing health care systems and you're of the size that we think you may be a likely target and one thing we think you should be thinking about doing is what we call called a ‘Day One Litigation Analysis’ and to see how you'd perform against that. And, for the two clients we were talking to in Massachusetts, one we were actually, the day we were there talking to them about this with them, was the day the law suit was served."
"We were in the meeting and we were telling them you're at real risk for being sued by this firm and we were planning what they would do and how they would start preparing now. and while we were in the meeting someone came in and said the law suit had been filed," says Spinola.
Was the client impressed? "I think what the client actually said was 'I wish you were right on this,'" adds Schreter.
The Littler team analyzed what the plaintiffs lawyers were doing and found that they were "just taking the same complaint, changing the names and using [the same argument] case after case after case," he said. "They started making mistakes and taking the facts from one case and transporting it onto another."
The team identified the plaintiffs' routine, process and strategies. "We had a very good sense of where we thought they would go," Schreter says. "Angelo then plotted out what we could expect and built a box saying 'this is what they are going to do and this is what we're going to do.' We saw that they always used the same expert witness and we hired that person before they could. It's that kind of thinking that is emblematic of how we approach our cases."
Adds Spinola, "We look at every opportunity; every case is different. One approach isn't going to work. We look at the judge, the lawyers on the other side. We look into a crystal ball and figure out that most of the opposition has a routine. They follow a process. We look and figure out what we can expect them to do in the next case. We develop a strategy where we know where they're going to go and we'll build our case with that. We know what they're going to do so they fall into our traps."
After removing the case to federal court, the Littler team waged its battle. The RICO claim was dismissed, and many of the common-law claims were preempted. Mediation failed and both parties urged the court to reconsider its ruling. Littler urged dismissal of more claims. The court dismissed all of the state law claims as well as the RICO and ERISA claims. The judge not only granted Littler's motions in their entirety, Spinola says, but created new precedent by applying a hospital exemption that Littler argued was applicable to its client, thereby making a Massachusetts state wage statute inapplicable to the system.
Although 16 different hospitals were slapped with suits, the two named plaintiffs had each worked in only one hospital. Littler argued the plaintiffs did not have the constitutional standing
in the other hospitals. The team based its argument on an exemption that had been ignored by attorneys and courts that made a state wage statute inapplicable to the system. "The exemption had never been interpreted before under Massachusetts law. No one thought the exemption was a real exemption," Spinola said.
The district court agreed and granted a motion to dismiss the class action case on the pleadings. The court also refused to permit plaintiffs to amend their complaint. Eventually the First Circuit affirmed the dismissal with prejudice of the 13 state law claims and agreed with the dismissal of the federal law claims. On remand the plaintiffs filed an amended complaint against nine entities; Littler moved to dismiss eight of them and the motions were granted. A settlement was reached for the remaining defendant.
"We kept them locked up for three years and they never got into discovery," Spinola says. "They couldn't get past the complaints because we were ready for whatever they said. By the time they got it right, there was nothing left to argue."
There were several keys to that case, Schreter says. "It sounds obvious, but we looked at the law and saw this exemption." The second is that as the "largest labor and employment law firm in the world, there isn't a subject matter that we don't have expertise in." Although the team was based out of Littler's Atlanta office, Schreter says her Boston colleagues were instrumental in the wins.
A little closer to home, a case with far-reaching ramifications was Wendy Cabrera and the EEOC v. The HoneyBaked Ham Company of Georgia involving a Colorado store manager who had been terminated for three separate store security violations. The manager, Wendy Cabrera, alleged she was fired in retaliation for previously complaining about sexual harassment by her general manager at the store. The U.S. Equal Opportunity Employment Commission, on behalf of Cabrera and 21 other female employees, filed a class action lawsuit alleging the company violated Title VII of the Civil Rights Act and sought compensatory and punitive damages. It also sought to expand the case to include several women in three states.
After nearly two years of litigation, the EEOC was sanctioned by the U.S. District Court of Colorado for discovery abuses and several of the class members' claims were dismissed. The entire class action lawsuit was resolved for a fraction of the EEOC's initial demands.
The lawsuit was resolved for an amount that was less than 8 percent of the EEOC's initial monetary demand and was the lowest recovery in Colorado "per class member" for EEOC litigation in the past 10 years. In addition, Spinola says the lawsuit was resolved for less than the attorney fees and costs the company would have incurred to obtain a complete defense verdict at trial.
"The case just unraveled and resulted in the lowest settlement in Colorado, which is an aggressive EEOC state," says Spinola. "In addition, the judge granted sanctions against the EEOC, saying their actions made the defendants' discovery efforts 'more time-consuming, laborious and adversarial than it should have been.'"
The Littler team learned from Cabrera's former roommate of some Facebook posts and other communications among the plaintiffs that would be damaging to their claims. The roommate allowed them access to her Facebook page. "It was a gold mine," he says.
Littler served discovery, requesting the same Facebook posts they had collected. When the plaintiffs failed to turn them over, Littler produced the Facebook posts to the EEOC and demanded an explanation as to why they were not produced. The court, agreeing that the EEOC had not acted properly, ordered the EEOC to pay for a third-party vendor to collect the information.
"Let me tell you, you rarely get a judge to sanction the EEOC," says Schreter.
Littler "appreciates teamwork and they are tremendously responsive," says John Camperlengo, senior vice president, general counsel, chief compliance officer and secretary at Atlanta-based client Gentiva Health Services. "They are instructive about the nuances of the law and respectful of time commitments."
Littler worked with Gentiva when home health clinicians working for Gentiva brought a class and collective action under the Fair Labor Standards Act and New York and North Carolina law. As of last month, each of the claims had been dismissed on summary judgment by the U.S. District Court for the Northern District of Georgia. The only claims remaining are the plaintiffs' FLSA claims, which have been conditionally certified. More than 100 opt-in plaintiffs have been dismissed from the class and as of September 2013, 999 named and opt-in plaintiffs remain on the case.
As of last month, each of the state law claims had been dismissed.
Schreter, who prior to law school held a variety of management positions in human resources, including one with Haverty Furniture Co., says that her background also influences her strategies.
"I look at it from the in-house client's perspective because they are going to have to deal with a case long after it's gone," Schreter says. "We get to defend, but they have to live with the ramifications.
"Litigation is never a goal," she adds. "It's disruptive, invasive and really a nightmare. It's a test of an organization. But a change in how an employee is classified can be a business changer."