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Although the number of women attending law school has outnumbered the number of men attending law school for several years now, it seems those women have a harder time climbing the corporate ladder than their male counterparts once they graduate from law school. According to a recently proposed class action lawsuit against Jones Day, the law firm allegedly maintains a fraternity-type culture that consistently treats men better than women – especially women who are pregnant and/or already have children.

The proposed class action gender discrimination lawsuit was filed by Andrea Mazingo, Nilab Rahyar Tolton, and four other women who have chosen to remain anonymous, on behalf of all female associates who are working for or have worked for Jones Day in Irvine, California. Despite the fact that the firm hires the same number of male and female associates, their situations allegedly vary drastically once they get the job. Female associates are allegedly paid less than their male counterparts and are significantly less likely to make partner. The law firm also allegedly has a practice of regularly firing women who get pregnant and retaliating against women who speak up.

By contrast, the lawsuit alleges male associates were consistently mentored, groomed for partnership, and given better assignments and more access to clients than their female counterparts. Mazingo alleges she was encouraged to wear high heels, another plaintiff claims she was told to smile more, and another was allegedly referred to as “eye candy.” Continue reading ›

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Last month, the United States Supreme Court issued a unanimous opinion resolving a long-standing circuit split concerning when a copyrighted work is considered “registered” for the purposes of initiating a copyright infringement lawsuit. The Supreme Court held that a lawsuit for copyright infringement can only be filed after the U.S. Copyright Office actually issues a registration certificate for the work.

The case, Fourth Estate Public Benefit Corp. v. Wall-Street.com, LLC, centered on whether Fourth Estate, an online news organization, could sue Wall-Street.com for copyright infringement after the defendant canceled its license agreement but continued to display Fourth Estate’s content on its website. The fourth Estate filed its infringement suit after it had filed applications to register the articles with the Register of Copyrights but before it received registration certificates for the articles. Continue reading ›

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The district court granted summary judgment to a bank on a breach of contract claim where a bank customer was precluded from suing bank for payment of fraudulent checks because customer did not report fraud within 90 days of receiving statement containing copy of first fraudulent check, and account agreement specified that fraud was required to be reported within 90 days.

Designer Direct, Inc. has a bank account with PNC Financial Services Group, Inc. Three of Designer Direct’s officers are authorized signers on its bank account. Between October 2016 and May 2017, Designer Direct’s former office manager, Kristiana Ostojic, forged one of those officers’, Stephen Rebarchak, signature on thirty-nine checks drawn on the account. Each check was made payable either to Ostojic or KO Development. The sum total of the fraudulent checks was $185,421.94

Ostojic deposited each check at either US Bank or JP Morgan Chase. The checks were then eventually presented to PNC for payment and were processed during the normal course of business through an automated system. PNC mailed account statements to Designer Direct each month. Each statement identified checks drawn on the account by date, check number, and amount. PNC also included copies of drawn checks with each statement.

Rebarchak reviewed all of the statements sent by PNC but did not see the electronic check copies because Ostojic intercepted the online statements and removed the check images before he could see them. When Rebarchak did finally see one of the checks, in May 2017, he was immediately aware of the fraud and notified PNC the next day. Designer Direct eventually sued PNC in federal district court in the Northern District of Illinois for breach of contract, alleging that PNC breached the account agreement by failing to exercise ordinary care in the payment of the checks. Continue reading ›

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Employers in New Jersey must review their current policies and practices to ensure compliance with a new statutory prohibition on the inclusion of non-disclosure provisions in employment contracts or settlements involving discrimination, harassment, or retaliation claims. The new law, signed by New Jersey governor, Phil Murphy, on March 18, 2019, and effective immediately, states that employers cannot insist that employees keep confidential the details of such claims or settlements. The law makes clear though that it should not be construed as prohibiting employers and employees from entering into non-compete agreements and confidentiality agreements relating to proprietary information, such as non-public trade secrets, business plans, or customer lists or information.

The law renders any provision in an employment contract that waives “any substantive or procedural right or remedy relating to a claim of discrimination, retaliation or harassment … against public policy and unenforceable against a current or former employee who is a party to the contract or settlement.” The law also does not permit prospective waivers of any right or remedy under the New Jersey Law Against Discrimination, or any other state statute or case law. The new provisions, however, do not apply to collective bargaining agreements. Continue reading ›

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Although non-compete agreements were originally invented to keep executives from running off to competitors with trade secrets and/or client relationships, many businesses have started taking advantage of noncompete agreements by including them in employment contracts with all their workers – even those at the bottom rung of the corporate ladder.

Workers earning minimum wage (or close to it) doing things like making sandwiches and entering data into a computer system are being made to sign employment agreements that prohibit them from working in any capacity for a similar company. Despite the fact that these are unskilled jobs (often held by people who don’t even have a high school diploma), and certainly don’t include access to any important trade secrets, workers are being made to sign such agreements as a condition of employment. And when agreeing to all the terms of the contract is the difference between getting the job and going without a paycheck, most workers don’t consider it much of a choice.

Although signing the employment contract might get them the job, it makes it much harder for them to move up the corporate ladder because the non-compete agreement often means they can’t leverage their experience to get a better paying position with another company. Their options are to try to move up the ladder in their own company or stay in their position where they’ll continue to earn the same low wage.

If employees try to take a new job in violation of the non-compete agreement, they can be prevented from doing so or even made to leave their new job after they’ve settled into it. In many cases, the clause prevents workers from even looking for new employment or asking for a raise for fear of retaliation from their employer. And when they’re not allowed to seek out a similar position with another company that pays better, they have no leverage to ask for a raise. Continue reading ›

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As fewer physicians are forming their own practices, they are finding one potential disadvantage to hospital or physician group employment: non-compete agreements. Physician employment contracts, particularly for specialists, increasingly include non-compete agreements or non-solicitation agreements (sometimes referred to collectively as restrictive covenants). This can lead to expensive, protracted legal disputes when doctors attempt to leave one physician group for another or desire to form their own practices. Further, many patients lose contact with their doctors when they switch practices. In a recent survey of nearly 2,000 primary care doctors in 5 states, 45% of the physicians surveyed had covenants-not-to-compete or other restrictive covenants in their employment agreements.

As large health systems look for ways to remain profitable, many are turning to physician practices to expand specialty offerings and attract new patients (or obviate the need for patients to go to other hospitals or practice groups for different medical needs). From 2015 to 2016, hospitals acquired 5,000 physician practices and employed more than 14,000 physicians, according to a study conducted by the Physician Advocacy Institute. According to the study, between 2012 and 2016, hospital-owned physician practices doubled and there was a 63% increase in hospital-employed doctors. Nothing in recent health care trends indicates an end to this movement. Continue reading ›

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Where a class of consumers sued an energy company for breach of contract, fraud, and unjust enrichment, the district court dismissed some, but not all, of the claims. The district court found that the consumers had sufficiently alleged that the energy company violated its agreement to charge rates for electricity based on market conditions and that the consumers had pled a claim for unjust enrichment in the alternative. However, the court found that the consumers failed to allege adequate details of a fraudulent scheme.

Verde Energy USA, Inc. was sued by a class of consumers in federal court for the Northern District of Illinois. The consumers alleged that Verde violated the Illinois Consumer Fraud and Deceptive Business Practice Act, breached its contract, or alternatively was guilty of unjust enrichment with respect to the class. The consumers’ complaint alleged that Verde had taken advantage of the deregulation of the Illinois energy market, convincing consumers to switch from their prior energy company to Verde by offering a teaser rate that was lower than the utilities’ actual rates for electricity. The consumers alleged that, after the teaser rate expired, Verde switched consumers to a variable rate that was not based on market conditions as required by the contract the consumers had with Verde. Continue reading ›

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Where an employee was free to take the knowledge he had accumulated over his nearly 30-year long career into his next job as a consultant, representing buyers of the products of his former employer.

Archer Daniels Midland is one of the largest manufacturers of corn-based sweeteners in the United States. In its most recent fiscal year, the sweeteners division of ADM realized a profit of $600 million. ADM sells its sweeteners to a few hundred buyers in the United States, including Sensory Effects, Inc. and PMP, Inc.

ADM categorizes buyers in one of two categories: toll contract or flat rate. Toll contract buyers contract to buy a fixed quantity of sweetener from ADM during a year, with the price fluctuating in response to the price of corn. Toll contracts may be entered into at any time of the year. Flat rate contracts can be entered into only during ADM’s annual contracting season, which lasts 30 to 60 days, beginning in the late summer. Under a flat rate agreement, the buyer agrees to pay a fixed price for a full year’s supply of sweetener.

Lane Sinele worked for ADM from January 1990 until his retirement in August 2018. At his retirement, Sinele was the manager of national accounts for ADM’s sweetener division. Sinele represented ADM, soliciting, procuring, and servicing buyers of sweeteners. Sinele handled the accounts for both Sensory Effects and PMP. As part of his employment, Sinele signed two non-disclosure agreements, though he did not sign either non-compete or non-solicitation agreements. During his career, Sinele had access to ADM’s Tableau system, which contained proprietary information about freight systems, factories, customer orders, manufacturing costs, and margins. Continue reading ›

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When a water main was damaged by work performed by a telecommunications company, causing a pharmacy to flood and sustain damage, the circuit court did not err in granting summary judgment to the insurance company. The Illinois appellate court found that the policy’s exclusion of coverage for damages relating to water from under the surface of the ground applied to water that originated underground, even if the damage caused by that water occurred above ground.

In December 2015, Prekshot Professional Pharmacy was operating in leased space in Peoria, Illinois. Preckshot had a contract of insurance with its insurer, Pharmacists Mutual. AT&T and its subcontractor were performing directional boring behind Preckshot’s premises. The boring damaged a water service line near the Preckshot premises, causing a discharge of water that flooded the Preckshot pharmacy above the ground.

Preckshot subsequently filed a claim with Pharmacists Mutual pursuant to its insurance policy. Pharmacists dispatched an investigator to determine the precise cause of the damages. The inspector concluded that the water from the ruptured line flowed through under a concrete slab and came up through the ground to infiltrate the interior of the pharmacy. Pharmacists then denied Preckshot’s claim, stating that coverage was excluded by a provision in the policy which excluded perils caused by water below the surface of the ground. Continue reading ›

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What if you were a college student and you realized one of your professors kept a seating chart that included comments about each student’s race and judgments on their physical appearance? That’s the possibility that Elmhurst College students faced when an article was published in the student newspaper, The Leader, about Professor Timothy Hays, the music business director at Elmhurst College. A student allegedly took a photo of Hays’s seating chart when he was out of the room and sent it to the school newspaper.

The seating chart allegedly contained notes beneath each student’s name relating to their physical appearance, including “black,” “Hispanic,” and, for a female student, “cute.” While such notes might seem harmless to the professor, they could be in the view of some of the students and the college administration, ways of separating minority students out from the “normal” white, male students, and such notes some students and the administration could argue have a profound effect on the way the professor treats those students, even if he’s not consciously aware of it. Some will claim that such views simply reflect political correctedness and that private notes should not be a basis for taking action against a professor abesent proof that he has ever acted in such a discriminatory fashion. However, benign discrimination is always hard to detect.

Hays argued that the notes were intended to be private and were never meant to be publicly distributed and were simply a tool to help him identify and remember students and their classroom contributions. Hays then allegedly made the situation worse for himself after the initial article was published by allegedly lashing out at students in his class after the article was published. Some Students complained to college officials and got them to bring in a new professor for the class and The Leader published another article about Hays relating to the incident.

Another student alleged Hays cornered her in a stairwell and looked down her shirt. She said she told college officials about it, but nothing was done until the third article about Professor Hays was published, detailing the incident. Continue reading ›

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