Cal Biz Lit

How Not to Give References

Most employer's attorneys advise their clients that when an inquiry is made about a former employee, the employer should limit the response to confirming the former employee's dates of employment and job title.  There are two reasons for this:  avoiding liability to the prospective employer for misleading information about a problem employee, and avoiding liability to the former employer for defamation.  This is certainly conservative legal advice and probably a good way to avoid litigation risk.

There are also a significant number of employers who consider this advice to be overkill, and who continue to give out information about past employees. Their logic is that the hiring process is a difficult one, and employers should help one another.  CalBizLit is not unsympathetic with this view, although as an employer, it tends to err on the side of risk avoidance.

But here's something everybody can agree is a bad idea.  Verdict Search
(Subscription Requ'd) reports on the case of William Dozier v. Lithia Ford of Fresno and Mike Leal, Fresno Superior Court No. 05CECG02456.  The news report from the Fresno Bee also appears at the web site for Oren & Paboojian, who represented Dozier.

This was an arbitrator's decision, not a jury verdict.  Plaintiff was a salesman for Lithia Ford.  He left to take another job.  His former  manager faxed posters to his new employer, depicting him as "wanted" for being a traitor and backstabber.  Dozier sued for defamation.

Here's the twist:  Dozier was a Vietnam veteran sniper.  When he was in Vietnam, the Viet Cong circulated wanted posters with his photo on it.  He claimed that the posters caused flashbacks to his service time, caused him to start drinking again, and resulted in VA hospitalization.  His alcohol use caused him to lose his job and the family home.

The arbitrator found that the posters were defamatory and all the damages were caused by the defamation.  He awarded $775,000.

Not Such A Good Way to Defend A Prop 65 Case

Under Proposition 65 (Health and Safety Code Section 25249.5 and following), a private party enforcer (or bounty hunter) can sue any employer of ten or more persons who has exposed persons to carcinogens or reproductive toxicants on the governor’s lists.  I’ve blogged about this here, and have a white paper on the subject here.

Anyway, before filing suit, the bounty hunter has to give sixty days notification to the potential defendant and the attorney general under section 29249.7(d)(1).  That’s what the bounty hunter did in CKE Restaurants, Inc. v. Alicia Moore (January 24, 2008) ___ Cal.App.4th ___ (Fourth Dist., 2nd Civil No. B197077).

CKE, which owns a bunch of Carl’s Junior Restaurants, responded by suing Moore for declaratory relief that its restaurants were in fact in compliance with Proposition 65.  CKE contended it was basing its suit on the declaratory relief mechanism authorized by the Court of Appeal in Baxter v. Denton (2004) 120 Cal.App.4th 333.  (Full disclosure: CalBizLit’s alter ego, Bruce Nye, was co-lead counsel in the Baxter trial and lead appellate counsel.)  Unfortunately, the evidence in support of its contention consisted of test results from one set of fried food products from one restaurant in the chain.

Ms. Moore filed a special motion to strike against CKE under California’s anti-SLAPP (“strategic lawsuit against public participation”) statute, Code of Civil Procedure section 425.16.  The court held that the filing of a Proposition 65 notice is a protected activity in furtherance of her right of petition or free speech (something previously decided by the Supreme Court in Equilon Enterprises v. Consumer Cause, Inc. (2002) 29 Cal.4th 53, 68.  Thus, the defendant, CKE, had the burden of showing a probability it would prevail on the merits, or its complaint would be stricken.

The problem is, CKE had done its testing on the cheap: instead of conducting an in depth survey of all of its restaurant, sampling on different times, different places, under different conditions, CKE had its attorney go to one store, and buy orders on one occasion of a small amount of food from that single restaurant.   It then had a lab test the food and offer evidence that those samples didn’t contain enough of the chemical in question (naphthalene) to exceed the “no significant risk level.”  Since the sampling was inadequate, and Plaintiff’s own testing showed quantities of napthalene well in excess of the NSRL, the court held that CKE had not met its burden, and its complaint was properly stricken.

California’s anti-SLAPP statute is a really interesting subject for businesses, and I'm going to try to post a white paper on the subject some day soon.

Off-topic post:

Here's some great Count Basie for your Friday:

Attorneys' Fees in Motions to Compel Arbitration

California's appellate courts have issued many decisions in the past several years on binding arbitration provisions in consumer and employment contexts, which are typically non-negotiated contracts of adhesion.  But here's a commercial arbitration case (involving negotiated contracts and equal and sophisticated parties) with implications for all disputes over contractual arbitration provisions.

More after the jump.

How Not to Write An Employee Handbook

The Peters Law Group in Southern California is a small firm representing employees in discrimination, harassment and other litigation.  They also publish the often excellent California Employee Rights Blog.

Over the weekend, they published an amazing post on Tribune Co.'s (owner of the L.A. Times, which also covered the story here) new employee manual, designed to get rid of "mind-numbing lawyer gobbeldygook" and replace it with "common sense."  But the manual, apparently written by a PR executive,  is full of mistakes, and ripe for an enterprising employee-side lawyer to use against Tribune in a future discrimination and harassment case. 

The many gaffes should remind every company doing business in this state that it needs meaningful, written employment policies, and those policies should be vetted by an employment lawyer who knows what she / he is doing, not by the company flack. 

My favorite is the description in the manual of sexual harassment:

    4.2 Working at Tribune means accepting that sometimes you might hear a word that you…might not use…experience an attitude you don’t share…[or] hear a joke that you might not consider funny.

    4.3 This should be understood, should not be a surprise and is not considered harassment.

    4.4 Harassment means being told that a raise, promotion or other benefit is dependent on you going on a date with your boss or some other similar activity.

Well, no, not actually.  While harassment is sometimes "quid pro quo" harassment (the type described in section 4.4 above), the much more common type is "hostile environment" harassment, which apparently isn't described anywhere in the manual.  While I agree that use of "a word that you…might not use…[or] an attitude you don’t share…[or]  joke that you might not consider funny" is not usually sexual harassment, when a sexually charged atmosphere is created by conduct which is severe or pervasive -- including the use of words, jokes or expressed attitudes in some instances -- an employer might well face liability for harassment.  And a lawyer representing an employee making claims of this type against Tribune would love to cross-examine Tribune's executives about language like this in an employee handbook or manual.