Zion Williamson Case Finally Ends?

The 4th Circuit recently closed down a long running legal case involving the NBA's New Orleans Pelicans star Zion Williamson and a problematic sports agent. I followed this case with particular interest because Williamson played his one year of college basketball at Duke (where I matriculated a long time ago) and I was an NFL agent for several decades. 

This case had all of the elements that make sports agency, and particularly sports agency representing college players about to turn pro, such a messy business.  Williamson was heavily recruited out of high school and widely identified as a potential superstar in the NBA. Or, in layman's terms, a “cash cow.” These kinds of players attract all the wrong attention as agents vie for their business and the potential to make millions. Frequently this vying involves under-the-table cash payments to the player, his family, his friends, or anyone else the agent thinks is likely to help secure the business. And it often involves an unseemly haste to get ink on a deal, often in violation of school recruiting policy and occasionally state law. 

That's what happened here. Williamson signed an agreement with a sports agent who was not licensed to do business in North Carolina. Mistake one. The agent had Williamson sign a representation agreement that did not comply with the requirements of North Carolina law. Mistake two. Court filings indicated that the agent sent Williamson's father $100,000 as an advance on their sports marketing agreement, and obviously as part of an inducement to sign. Mistake three. 

Then Williamson backed out of the agreement and signed with somebody else. The agent sued Williamson for $100 million in federal court. Mistake four. The trial court quickly ruled that the agent's failure to comply with even the most basic elements of North Carolina law rendered her agreement with Williamson void and denied her any recovery of the money she allegedly paid Williamson's father. That decision was upheld on appeal, here.

Lots of morals to this story. I guess the first is not to let greed override your judgment in pursuing that golden calf. That's very likely what happened here- the rush to get to Williamson and sign him to a multi-year agreement that effectively guaranteed a huge payoff for the agent caused her to simply ignore basic legal requirements, about which I'm sure she was aware. Now she's out the 100 grand, her attorney's fees, and very likely her reputation as someone who knows what she's doing. Given how every other sports agent will use this little episode against her, she's likely thinking of some other line of marketing work in the near future. 

Here's where DEI leads you in practice

As you will note from my previous entries in this blog, I believe DEI ("Diversity, Equity, and Inclusion") programs to be problematic and virtually impossible to implement legally under the laws of the United States. Here's an example of how DEI plays out in practice: a media company that committed itself to DEI practices gets sued because, in trying to maintain its writing standards, it did not give black employees full creative control over content creation. 

As is typical with DEI programs, there is no mention of merit with respect to the claims made by the minority writers. Their selection for the jobs in question was to be based solely on their race. 

I can't square this with the requirements of federal civil rights law and I suspect no one else can, either. 

Addendum:  A sure sign that this practice is opening companies up to legal liability (and apparently has adherents who view it like some religion they must defend) is a corporate attempt to rebrand the concept.

No More Non-Competes?

The Federal Trade Commission took the extraordinary step last week of issuing a nationwide ban on non-competition agreements.  The implications of the FTC's actions are significant and worth a quick discussion.

First of all, there is serious doubt whether the Commission has the constitutional authority to rewrite law across the country in such a manner. There is no statute from Congress authorizing such a move; the Commission made this sweeping change based on its determination that non-compete agreements, which are matters of individual employment contracting, fall within the Commission's purview to regulate anticompetitive actions between businesses. Given the Supreme Court's recent and pronounced disfavor with federal executive actions that effectively usurp congressional power, I think it's unlikely that this action will survive even an initial court review. Although it is highly likely to be in effect at least through the presidential elections this fall, which I suppose is the actual goal of the Commission's action.

Secondly, the Commission's action removes an irreplaceable tool for employers to protect their investment in senior management employees. There are very few means for a company to prevent the loss of corporate and business expertise when a manager intimately familiar with product development, marketing demographics, sales strategy, and the like, departs for a competing business.  Often the business expertise of the departing manager developed over years with a particular company and is a direct product of the company's efforts to train and develop her talent. A transferring senior manager instantly makes the gaining company a formidable competitor, but without the time and investment made by the former employer.  

The Commission asserts that current trade secret law is sufficient to protect the losing company's interests.  Sometimes I wonder if the federal bureaucrats making these decisions spend any time working in the private sector. There is no way to extend trade secret or other intellectual property protection to the kind of long-term business practice expertise that non-competes, properly employed, are designed to protect.  The Commission's actions, like the actions of so many of our federal executive agencies, simply add to the burden and risk of hiring employees for the long term.

Acronym Soup-NPR and the NLRA

The saga of Uri Berliner, a senior editor at NPR, has some interesting angles from an employment law perspective.

Berliner published an article in The Free Press that detailed a lack of political and intellectual diversity at NPR that he claimed significantly damaged its journalism. He criticized the monoculture and groupthink mentality that supposedly permeates NPR's decision-making with respect to the stories that it covers and how it covers them. NPR's new CEO came in for specific criticism in the article, which was published without prior coordination from NPR management, and which violates NPR's internal policies.

The organization's reaction was immediate- it suspended Berliner for five days without pay and warned him that if he spoke or provided content to another outside media entity without prior NPR approval he would be fired.

My first reaction upon reading this was that NPR's actions were almost certainly a violation of Section 7 of the National Labor Relations Act, which prohibits employers from retaliating against employees who engage in so-called “protected concerted activity.” “Protected concerted activity” has two elements- the activity, typically a complaint or other demonstration of dissatisfaction, must relate to the terms and conditions of employment, and it must relate to circumstances that affect other members of the organization, not just the individual raising the concern. The term has recently been litigated before the National Labor Relations Board which adopted a “totality of the circumstances” analysis to determine whether employee conduct falls under the coverage of Section 7. 

It's clear that Berliner’s comments fall within the ambit of this term. The issue is whether NPR fired him for this conduct or for the alleged violation of its internal policies. And here I think NPR has some problems. For one thing, there are apparently other instances where NPR members either granted interviews or wrote for other outside media without facing disciplinary action. Perhaps more importantly, the immediate response by NPR management against a long-time senior employee with little or no investigation and only a whiff of progressive discipline is indicative of a response based on the content of the column and not its lack of coordination.

Berliner has indicated he will not challenge the suspension but this widely publicized story is a cautionary tale for management. In situations like this, avoid the immediate, knee-jerk response to hit back at the employee. NPR would have been better served by taking its time, performing an investigation (and especially an investigation that looked at other examples of this conduct and the discipline meted out), and then dealing with the employee. The company may have dodged a bullet here.

EEOC Goes After An AI As An Employer

There's an interesting employment law case developing in California (it's always California) involving the status of a software company as an employer or employment agency for one of its clients.  The case potentially represents a major expansion of employment law liability for companies supplying services that involve employee screening, hiring, or any other kind of concrete employment decision. The implications for artificial intelligence programs in particular look to be very serious. 

The facts are straightforward. An individual made over 100 applications to various employers that used an online application template provided by a company named Workday.  Potential hires would apply online to companies through various hiring sources (e.g., LinkedIn) and were then directed to the Workday app where they would input a resume and personal details, and in some instances take an aptitude test. The plaintiff in this case was rejected for all of his applications (we have no indication of whether he was qualified for the jobs for which he applied). He is now claiming that these rejections were based on his race and disability, which he apparently was revealing as a matter of course in the application process. 

Important safety tip here- while I have not seen the Workday template, I'm reasonably certain that it does not ask for the race and a list of disabling conditions on the part of applicants, At least as part of an initial hiring process. How and why this information was being input at this stage raises an interesting question about whether these were bona fide employment applications. 

In any event, the Workday app reviews the templated information and then forwards qualifying applications on to the employer. There is no interview interaction or any other kind of personal evaluation of the applicant- the software simply screens the application for job requirements and determines if this is a potentially good match based on the criteria from the employer. 

Given its relatively mundane function, imagine Workday's surprise when it found itself in the crosshairs of an employment discrimination lawsuit filed not by one of its employees, but by one of its customer's employees. And to make matters worse, the EEOC has now jumped into the fray, arguing that the company is in fact acting as an employment agency and therefore is subject to Title VII for the employment decisions that are, in essence, being made as a result of the criteria Workday receives from its customers. 

The motion detailing these arguments is here. The implications are much broader than simply whether Workday is acting as an employment agency. Many companies are moving to artificial intelligence algorithms to assist them in making employment decisions involving hiring, firing, promotions, etc. Under the EEOC's theory, the manufacturers of these software systems could find themselves in the Commission's sights either as employers outright or as some kind of quasi-employer. I'm reasonably certain the Commission is attacking AI systems as discriminatory across the board because their widespread use will likely mean the end of affirmative action as we know it.

Imagine you manufacture an AI system that helps employers assess talent for internal promotions. Suddenly you are subject to Title VII liability not only for the employees in your own company, but for the tens of thousands of employment decisions for which your application is used throughout the United States. Sound crazy? I agree. But this is the logical outgrowth of the EEOC's position in this Workday case. 

Stand by for more exciting news from Northern California. 

The NFL and the End of Race-Norming Benefits

The NFL concussion protocol and the legal issues surrounding how to compensate several generations of players who sustained cumulative neurological trauma continue to evolve, albeit at a slower pace than when the litigation was originally started 15 years ago. 

The latest round involves a practice known as "race-norming," which is a methodology of assessing cognitive damage that is as mercenary as it is offensive. In a nutshell, a number of NFL players applying for benefits under the concussion protocol were not subject to the cognitive baseline assessments that are now performed on NFL players at the start of every season. And although these former players were now presenting with clear evidence of cognitive decline as a result of thousands of head impacts, without knowing the individual cognitive starting point, it's impossible to determine the extent of the overall injury and thus the NFL concussion benefit plan's liability. 

To make up for this lack of baseline knowledge, the insurance plan administrators did what they always do-they used an average cognitive baseline for players given their demographic characteristics, which included race. These averages lowered the cognitive baseline for black players based on practices used in a variety of other medical specialties. The upshot of this was that black football players without the individual cognitive baseline assessment had to show a steeper decline in cognitive ability to get the same level of benefits that a white player would receive with a similar cognitive score. 

This all came out in litigation over concussion benefits in 2020 and the picture wasn't a pretty one. The NFL formally stopped the practice in 2022. It looks like the last lawsuit over this issue is now about to be settled, which I'm sure is a very welcome result at the NFL's Park Avenue headquarters. 

Once Again, Basic Management Principles Would Have Helped Avoid A Lawsuit

Occasionally,  I run across a case that is such a model of management missteps that it practically begs to be included in the blog. Here is there another example. 

A female employee had worked her way up through the ranks at Aramark to a senior management position. Her problems started when a new manager came in, one whose actions went apparently unmonitored.

You can read a more complete version of the facts here, but let me summarize a couple of timeless lessons that apply to virtually every employee management situation.

1. Long-term employees, and in particular long-term employees who have worked their way up through the ranks into management positions in the company, are entitled to a basic level of respect in how management deals with them. That respect normally takes the form of some kind of extended due process, especially in termination situations. A company terminating a long-time employee should be particularly diligent in reviewing the circumstances surrounding the termination, and management's actions in dealing with the employee.

2. While employers may generally expect the workforce to adapt to the requirements of new leadership, a radical change in subordinate performance evaluations may well indicate a problem with the leadership rather than the subordinate employees. Company leadership should be sensitive to a new manager finding significant faults with established performers. See, #1, above.

3. Complaints from management-level employees should never be ignored, but instead investigated carefully. That doesn't mean that the employer accepts as true every allegation from a manager, but the company must establish a rational basis for not taking corrective action in response to those allegations.

4. No termination decision should take place in a vacuum. The employer must be aware of all the circumstances within its span of knowledge surrounding an employee who is about to be fired. In this case, someone should have noted that the employee filed an HR complaint days before the termination was effected.

This is relatively common sense stuff, or put another way, Smart and Legal Employee Management 101.  Not following these basic principles gets expensive very quickly.

Thoughtcrimes Now in Vogue at Air Force?

Here's a strange and disturbing story out of the Air Force Academy. It seems that in an effort to police what it believes are incidents of bullying, disinformation, or extremist commentary the AF leadership has set up a social media monitoring mechanism that reviews the personal, off-duty activities of cadets in places like Instagram, TikTok, Facebook, X and the like. 

Now, military members have significantly fewer protections under the Constitution than civilians. This has been clear since the founding of the Republic. Service members are prohibited by law from openly criticizing certain elected officials, for example. But airmen, soldiers and sailors don't forfeit all of their constitutional rights, and the open-ended nature of this monitoring program sounds a clear signal that Academy officials are not interested in just correcting incidents of illegality that might be revealed on social media. Those officials are interested in discovering people who have improper thoughts about, well, who knows? The originator and overseer of the project is quoted as saying, "The goal of monitoring social media is to educate cadets, prevent them from spreading harmful material online and respond when someone is posting content that academy leaders consider harmful to the base’s culture."  

Well. Nothing overreaching or potentially problematic about that. The Air Force cadet squadrons already contain what most of us familiar with the program refer to as political officers- cadets who have been stewed in the military's version of  DEI - to report their wrong-thinking peers for reeduca-, uh, counseling when they express opinions inconsistent with DEI theology. It's not much of an intellectual leap to see how monitoring off-duty and private social communications can greatly assist in ferreting out wrongthink.  

As you can see from the article, several constitutional and privacy law specialists who are real lawyers are raising 4th Amendment questions about this program. My hope is that the monitoring system gets cut before it provides Academy officials with information that their DEI programs aren't being taken seriously by the cadets. If that happens, the program will expand dramatically unless it's curtailed by legal challenge. 

COVID Vaccine Aviation Cases Continue to Lose

One of the major disappointments among the many arising out of the COVID vaccine mandates was the almost complete failure of the US legal system to adequately respond to this unprecedented breach of employment law. There were a couple of big wins- Biden was unable to force virtually the entire US workforce into getting a shot with an unlicensed vaccine against its will, for example- but for the most part employer vaccine mandates have been approved by state and federal courts. This notwithstanding the fact that almost every one of the mandates, and the questions being asked leading up to the mandates, were a clear violation of the Americans with Disabilities Act ("ADA") and Title VII in cases where religious exemptions were in play. 

Examples include cases involving pilots for United Airlines (the only airline that actually terminated employees for refusing to get vaccinated) and Kalitta Air, a cargo carrier. In both cases, pilots who refused the vaccine on religious grounds had their claims disposed of on procedural grounds before any meaningful litigation could take place. 

The story of COVID vaccine employer mandates is one that needs to be explored in much greater detail. Here's my summarized take: The US set up a legal regime under the ADA specifically designed to prevent precisely what happened with the COVID vaccine mandates, namely, a presumption by employers that their employees were disabled because they were contagious, accompanied by unauthorized inquiries into the vaccination status of the workforce. Because no judge wanted to be the one who authorized a shutdown of vaccine mandates in the face of a supposedly terrifying epidemic, these legal issues went basically unexamined. The irony, of course, is that as we learn more about the nature of the disease and the vaccine development itself, there is less reason to support these mandates. I'll hope at some point this story gets the coverage it deserves. 

The Next ERISA Litigation Frontier--Drug Plans and Fiduciary Duty

The Employee Retirement Income Security Act, better known as ERISA, was enacted to provide protections for employee benefit plans that companies were setting up as inducements for hiring and employee retention.  ERISA's requirements are highly technical and involved, part of ERISA's protection scheme against nefarious employers and plan administrators who just don't seem to be able to keep their mitts off the significant amounts of money controlled in these benefit plans. 

As an employment lawyer, my perception of ERISA is that it is a never-ending source of plaintiff's litigation as plan administrators seem to make one misstep after another in handling employee investments and returns. The latest round of endless ERISA litigation involves drug plans and the entities set up by employer health insurance plans to monitor drug costs. Most of this litigation involves an alleged failure by the plan administrators to ensure that drugs covered by employer health insurance plans are the cheapest, most effective, and most readily available. There's a very detailed and boring description of the litigation here-- it looks like the plaintiff's bar has discovered another relatively untapped source of money to exploit with huge class action claims. 

As with most litigation claims under the statute, this new variety should serve as a warning that employers cannot simply dump responsibility for the management of their benefit plans - health, retirement, etc. - to third parties without some type of oversight. Remember, the statute does not require that everything be done on the lowest cost basis, but rather that plan decisions are based on rational and justifiable reasons. It wouldn't hurt to sit down with plan administrators annually and get an explanation for the decisions they are making on your retirement and health insurance programs. 

IDF Pictures and Free Speech in Illinois

One of the first issues I ever dealt with as an employment lawyer involved a personal photograph in a private office. A manager had a picture of his wife in a very skimpy bathing suit displayed on his desk. My recollection is that this was an 8 by 10 photo, large enough for the details to be obvious to anyone who stuck their head in the door. There were the usual complaints from several women in the office who objected to having to look at a mostly uncovered female form every time they had business with this manager. 

We dealt with the problem by telling the manager that the company really didn't want pictures of scantily clad women prominently displayed in the office as a matter of professionalism. That seemed to quell the issue. 

The latest round in the office photo wars is taking place in Illinois, where a female public defender prominently displayed a picture of herself holding an M16 in front of the Israeli flag, taken when she was serving as a volunteer reservist in the Israeli army. 

Apparently, the picture had been in her personal office for some time but after the events of October 7, 2023, she moved the photo to a public area where people in the office displayed personal photos and awards. This drew an immediate and ignorant response from office management who were offended by the Israeli flag as much as they were by the automatic rifle. They initially ordered her to remove the photo from the public display, and then without permission entered her office and removed the photo from there. All of this was done under the guise of some kind of anti-violence policy because the photo could be perceived as “threatening.” Or perhaps it was the Star of David. As is typical with these decisions, the actual rationale gets murkier when people are asked to explain it. 

Because this involves a public employee, the 1st Amendment is implicated, and the lawsuit the former soldier filed reflects this. But for private sector employers, there are additional issues immediately apparent, starting with the potential religious discrimination issue, as well as potential claims involving political discrimination under Illinois law.  I also suspect that there were lots of other potentially objectionable photos on display in that office that were not singled out for attention and didn't happen to involve Jewish artifacts.  

This is a lousy situation for an office that likely has some exposure.  Based on the allegations in the Complaint, I'm hoping that the case doesn't go away and that all of the biases get revealed over the course of discovery.

The Song Remains the Same-SCOTUS Decision Reminds Employers to Keep Better Records

 

A fundamental piece of advice that I give to my clients is to, “keep sufficient documentary records of an employment decision so that we can recreate the analysis that led to the decision several years later.”  In virtually every employment case that ends up in some kind of agency or court setting, the key to prevailing is the ability to convincingly show what transpired between employer and employee that led to the decision at issue. 

This is always crucial in discrimination cases where an employer is usually aware of the employee's protected factor (you can't credibly testify that you didn't know you were dealing with a black female, or a Hispanic male, for example) and is asked to demonstrate that the protected factor did not play a role in the ultimate decision. 

This type of analysis is also crucial in retaliation claims, where the employer has to argue, for example,  that it wasn't the fact that the employee was a gadfly/whistleblower but rather it was her poor performance that caused the company to fire her. Again, an employer must keep solid records of its thought process and the basis for termination, because while most jurors might have difficulty believing that race was a factor in an employment decision, very few of them will have difficulty believing that the company was motivated to strike back at an employee who was causing significant cost and or embarrassment by outing some problematic business practice. 

The Sarbanes-Oxley Act was designed to provide significant whistleblower protections for employees of publicly traded companies to report corporate fraud or securities violations. The SCOTUS recently handed down a decision that should provide plenty of incentive for employers terminating whistleblowers to make sure that they can demonstrate that they are cleaner than Caesar's wife's hound's tooth. 

Sorry for the mixed metaphor but you get the picture. 

The SCOTUS reversed a Second Circuit finding that the SOX Act required an employee to show so-called “retaliatory intent” on the part of an employer to sustain a SOX violation. Instead, SCOTUS unanimously held that all a whistleblower has to show is that the protected activity- in this case, a claim that supervisors at UBS Securities were attempting to pressure an employee to alter his independent reporting- was a contributing factor to the employer's adverse personnel action. In essence, SCOTUS stated that if the employer was aware of the whistleblowing activity, it would have to produce convincing evidence that it would have made the same decision absent its knowledge that the affected employee was a rat, er, whistleblower, to escape liability. 

As noted above, this is a very high bar for the employer. To overcome the perfectly understandable inference that an aggrieved employer would act by retaliating against a problematic employee, a company is going to have to provide substantial evidence that either the aggrieved employee was already almost out the door because of her conduct and that the decision was effectively made before the company became aware of the whistleblowing, or that the conduct for which the employee was terminated was so egregious that his whistleblowing was not even a blip on the employer's radar when it made the call. 

Both of these scenarios require very credible testimony, backed up by credible documentation to show that the whistleblowing was not a factor. 

So, if you find yourself in a situation where you have identified a whistleblower in a SOX environment, your notes, memoranda, and testimony had better be recorded and validated. Otherwise, your next documentation is likely to take the form of a check to the plaintiff.  

Back to the future--Are college athletes employees? Of What, and When?

I wrote about this story back in 2014 when the NLRB first tried to shoehorn college athletes into employee status with a poorly reasoned regional attorney memo out of Chicago. The issue has arisen once again, this time at Dartmouth where an NLRB office director now claims that men's college basketball players are employees of the university. 

I won't reiterate all the arguments I made eight years ago, but the short answer is this is an idiotic characterization and completely misses the unique status that collegiate athletes have with respect to their coaches and their schools. Specifically, college coaches exercise far more control over athletes than any employer does or would ever want to. Coaches dictate what players eat, where they live, when they go to bed, when they get up, and when they do any number of activities that extend beyond basic practice time and game time. A better characterization of a coach's status then that of an employer is one of a parent. 

If the NLRB ruling survives the inevitable court challenge, it will result in massive confusion and unintended consequences in the form of things like wage and hour claims for film study, training room time, weight training, study time, and the like. A determination that these kids are actually employees would technically expand their workday to 24/7, with all the associated liability, because that's when they are under the control of their coaches and the athletic staffs. 

This determination makes no more sense now than it did eight years ago. I hope the courts will reject this director's characterization. 

Service Academy Admissions and Race: The Next Affirmative Action Challenge

In its landmark decision essentially voiding race-based affirmative action admission programs at colleges, the Supreme Court in a footnote made a notable distinction for America's service academies. The court held that its affirmative action ruling did not apply to those unique academic institutions, implying that race considerations weigh differently because of the issues involved in the construction of an effective fighting force. 

Within several months of the court's ruling, a challenge to the use of race in admissions at the United States Military Academy (West Point) emerged (the Naval Academy, USNA, is also being sued). The plaintiffs, white applicants to USMA, are alleging through their counsel that West Point's use of race as a determining factor in admissions is unconstitutional, particularly in light of the SCOTUS holding regarding Harvard and the University of North Carolina. 

The usual legal skirmishing over a preliminary injunction demand from the plaintiffs reveals at least the outlines of the arguments to be raised by USMA and the other service academies.  Fundamentally, the service academies claim that it's essential to have an officer corps that racially mirrors the overall racial percentages of the force because that makes for a more motivated and therefore more effective military. The academies claim that this claim is unassailable because US courts traditionally defer to something called "military judgment" about the management of the Armed Forces in the context of national defense. USMA also claims that race is a minimal factor in its admissions determinations, something that I think is completely incompatible with its professed goal of establishing a perfectly race-harmonized officer corps. 

There's lots more data and argument to be developed on this topic, but as a service academy graduate myself, I raise the following objections to USMA's position: 1 ) there is very little credible evidence supporting a claim that people need to be commanded by people who look like them to be effective in combat. If anything, the primary attribute service members worry about in their commanders is job competence. There's absolutely no comfort in the thought that you are going to get killed as a result of the orders from someone who shares your genetic heritage. 2 ) the service academies provide approximately 20% of the officer cadre in the military. Given that 80% of the officer candidates are coming from civilian universities through the ROTC program, you would think the “we need a racially diverse officer corps for effective command” argument would have resonated much more significantly in the SCOTUS FFFA opinion. The argument was raised but apparently found unconvincing. Why would it be more convincing for a school that provides much fewer officer candidates? 3 ) There's a very strong argument for making the service academies the producers of the top officer candidates in all services.  The government invests hundreds of thousands of dollars in USMA, USNA, and USAFA graduates, training them not just in academic specialties but military culture and warfighting skills. The goal is to produce career officers capable of performing at the very highest level in the most serious undertaking a government performs- the defense of the country. Why would you not want the very best people in these programs, regardless of their genetic propensities? 

In fact, much of the argument in favor of affirmative action for the service academies seems to be motivated by the same credential-seeking mentality present in the affirmative action movements at elite colleges, namely, that the credential somehow guarantees upward mobility into the elite classes. However, this has not been the case for the military because of its relatively ruthless performance requirements. And in any event, discounting merit in support of questionable social engineering seems a guaranteed way to degrade the value of the certificate across the board. 

This case will likely be the subject of other blog entries but, at the outset, I think USMA and the others are going to be facing an uphill push. 

Gambling Takes Another NFL Player Down

 The institutional and cultural conflicts inherent in the professional sports leagues and NCAA with respect to gambling continue to take a toll on the people who generate the income from these activities—the players themselves. It seems that virtually all major sports activities in the US, collegiate and professional, are now reaping significant money from sports gambling. Every NFL game is loaded with sports book advertisements. As for the “amateur” NCAA, swing by Vegas on the first weekend of the NCAA basketball tournament to get a picture of how big gambling is on collegiate athletics.

Yet all professional sports leagues and the NCAA prohibit betting in one form or another by the athletes themselves. And enforcement of these prohibitions regularly results in the suspensions of players taking advantage of an activity that their leagues actively promote.

And sometimes, worse than suspensions. Case in point--Kayshon Boutte, formerly of the LSU Tigers and currently an NFL wide receiver with the Patriots. But, as so many coaches have said, NFL stands for “not for long”, and that is likely the situation with Mr. Boutte, who was arrested for making bets while a collegiate athlete, in some cases on games involving his own team. The details are in the story, but it's clear from the allegations that Mr. Boutte has a gambling problem, one that the NFL security people are likely aware of. Someone with this type of issue represents a clear threat not only to the integrity of the game but to potentially billions of dollars in advertising and betting revenue. All of that gambling revenue, as well as a significant portion of fan interest, would melt away in the face of demonstrated allegations that players were betting on each other and themselves, with the obvious impact on scores and performance.

I suspect this conundrum of needing the revenue from sports betting while at the same time limiting its reach into the player ranks will continue indefinitely. There is simply too much money in gambling and its potential taxation for the people who would normally regulate this kind of thing--the states and the leagues themselves--to close up the Pandora's box that's been opened.

The Exciting Times of Family-Owned Businesses

The intertwined, emotion-bound relationships within a family business are often a source of employment law lessons if not downright entertainment. I suspect the entertainment value arises from the fact that we all presume a certain amount of affection exists within these family businesses that precludes the kind of cold-blooded opportunism permeating normal corporate structures. 

So it's a surprise when relatives go after each other like the lieutenants of Genghis Khan. A case in point- the top-level shenanigans at Adroit Medical Systems, a family heating pad manufacturing business. 

Apparently, the minority shareholder son of the owner was unhappy that his father's 80% ownership was passing to his wife, the son's stepmother.  What to do? Well, just have your father declared incompetent by a probate court, establish a conservancy for the estate naming yourself as conservator, and then proceed to take over the company, firing stepmother, other relatives, and changing the locks on the company doors. 

Oh, and before you kick this off, also make a surreptitious report to the IRS that your family members are engaged in tax fraud and embezzlement. You do that to give yourself some top cover just in case your coup attempt doesn't work. Specifically, the IRS complaint technically makes you a whistleblower. 

The whole Snidely Whiplash (that's him, above) plan fell apart in a matter of days once the probate court realized the old man was not incapacitated. The re-established company leadership promptly fired the son, who then leveraged his whistleblower status to sue his parents for retaliatory discharge. 

The Tennessee federal court, and ultimately the 6th Circuit, was having none of this silliness. The 6th Circuit panel noted that the bona fide reason for the termination- a phony claim of mental incapacity directed at the principal shareholder, followed by a complete takeover of the company and removal of its officers- was more than supported by the evidence. As one judge said, “ Who wouldn't think he would be fired?"

Entitlement and Layoffs--A Case Study

 

The Brittany Peach (her real surname is Pietsch)  viral video contains a couple of lessons for companies and employees, or soon-to-be-former employees (for the terminally unhip, Ms. Peach videoed her participation in a Zoom call terminating her employment from Cloudfare, an internet security company).  

Much of this has been discussed in various HR forums, so I will keep this brief. 

For employers: 1. Usually, but especially for entry-level positions like this one, a supervisor should provide the termination notice directly. Hiding behind human resources representatives, as Cloudfare did here, is classless and pointlessly humiliating for the employee. 2. Employers should also be prepared to provide some specifics to the employee as a basis for the termination decision-another reason to have the supervisor involved-so that even if there is not agreement as to the decision, there might be understanding. Even in at-will circumstances such as this one, an employee is entitled to know what they did wrong, which may allow them to remedy the problem with their next employer.  3. In any type of meeting like this you should expect to be recorded. 

For employees: Unless you have a firm expectation of financial solvency for the next 20 or 30 years of your life, don't do this. Ever.

Surprise: Race discrimination violates the law, regardless of when the statute was written

Those of us in the employment law business who were not wearing ideological blinders and closely followed the corporate rise of what is now referred to as DEI  were sounding alarms from the very first days of these programs. Specifically, we noted that the language of intersectionalism, DEI, ESG, CRT, and the rest of the acronym diversity universe was going to create real problems for companies that put these programs into effect. That's because the terms in which these programs are and were couched are unavoidably racist, sexist, and violative of every US civil rights law at every level.  I'm not sure why businesses believed that they could institute racial and gender-based incentive plans, hiring practices, and the like without consequence but I put it down to the ideological blinders mentioned above. 

Given these manifest legal issues, it comes as no surprise that DEI programs are being challenged regularly because they discriminate based on some protected factor such as race, gender, religion etc. There has been significant pushback on these challenges, including this one, which implies that anti-DEI efforts are so out of touch that challengers are reaching back to Civil War-era statutes to support the claims. 

This is, as we say in the legal business, “hogwash”. The 42 USC 1981 claims noted in the article have been part of the civil rights litigation picture in the United States for as long as I have been litigating cases. The main difference between 1981 claims then and 1981 claims now is that the plaintiffs referenced in this article are white. Rather than some desperate contortion of antiquated law, what this article identifies is the straightforward application of laws that prohibit race discrimination to situations in which race discrimination- specifically DEI programs- is manifest. There was nothing mysterious or novel about this situation and DEI accolytes should expect to see more of these claims in the future. 

Military Justice Debacle

 

The SECARMY removed a senior Army prosecutor from his position because of an email that he sent to his defense attorneys in 2013, esssentiually telling them that they were now in the crosshairs of a political movement that was seeking to influence the military justice process to get more convictions for sexual misconduct in the military.

Some thoughts from someone who has both prosecuted and defended sexual assault cases in military courts.

Although it is a difficult concept for most civilian attorneys to grasp, the military justice system that was put in place in the early 1950s (as the Uniform Code of Military Justice) is designed to accomplish two, sometimes contradictory, tasks. The first is to provide constitutional due process to service members accused of any of a specific list of crimes delineated by the UCMJ. Military defense counsel are obviously crucial in this process because they are frequently the only individuals with the capability to adequately overcome the tremendous advantage possessed by the prosecution on a military installation. Prosecution authority rests ultimately in a series of commanders at various levels. These individuals have unlimited resources at their disposal, including the ability to select potential jurors and to influence proceedings in any one of a thousand different ways, some obvious but most not. Military defense attorneys are generally removed from the formal chain of command so that local commanders cannot affect the career of a zealous defense counsel working to protect the interests of her client.

The second purpose of the military justice system is to promote good order, morale, and discipline within the ranks. This means that commanders have available to them procedures short of a formal trial proceeding by which they can enforce discipline. Article 15 of the UCMJ is one such mechanism that allows for a quasi-judicial proceeding before the commander, with or without the presence of a defense attorney, that is designed to quickly deal with the minor criminal infractions occurring in units every day. Commanders have significant autonomy and authority under this system and may elect to charge, ignore, or otherwise deal with issues that would normally be a matter of criminal concern to their military legal advisors. My recollection is that perhaps 5 or 6 times a year I confronted situations where my recommendation was to charge an individual under the UCMJ and the commander rejected it in favor of some other type of less severe action. Less frequent were the circumstances where a commander was adamant that we convene a court-martial even in circumstances where the evidence was less persuasive and I was much less confident of a guilty verdict. But in all circumstances, it was the commander who made the call, frequently in conjunction with advice and counsel from her own commander higher up in the military food chain.  

It's the second purpose that was creating heartburn for a number of female senators back in the 00s and early teens when this Army JAG wrote his e-mail. Commanders are given wide discretion in terms of the charges and the disposition of those charges. Military juries are perhaps some of the most educated and discerning groups before which I had the pleasure of practicing. They are also well-versed in military culture and generally have a wealth of experience dealing with disciplinary issues in their own units, either as observers or as actual commanders themselves. Perhaps just as important, the military population is not comparable to the civilian population in terms of conduct and bad motivation. Most of those people never make it past the initial recruitment process and are generally weeded out over the term of their first few years in service.

All of which is a long-winded way of saying that sexual assault and rape in the military looks completely different than it does in a civilian criminal court setting. Outright, predatory, sexual assaults are relatively rare; the vast majority of cases that I dealt with as a prosecutor and the few cases that I dealt with as a defense attorney involved ambiguous conduct on the part of both parties, almost always fueled by excessive consumption of alcohol.  Cases of forcible rape were noteworthy and got the immediate attention of military law enforcement and command.  

Given the less straightforward aspects of most of these sexual assault cases, commanders frequently found themselves trying to assess guilt or innocence with highly equivocal evidence. Those cases that went to trial confronted those military juries with the same issues. Often the accused was a person with an exemplary record who was alleged to have acted in a way that was completely inconsistent with their prior years of service. Accordingly, commanders would make a “split the baby” kind of analysis, electing to not formally charge individuals, reduce sentences imposed by juries, or figure out some other mechanism to deal with the problem short of formal criminal charges.

Progressives will say that much of this reluctance was due to some type of old boy network and that the males who predominate in the service are unlikely to hold their fellow men culpable except in the most extreme circumstances. Over the course of perhaps 30 or 40 sexual assault investigations during my JAG career, I never saw anything resembling this type of bias. It probably occurs, but my experience is that it is very limited.

But for several female lawmakers, caught up in the early stages of the “believe all women” movement, any acquittal, any resolution short of providing complete relief to a complaining party meant that the system was rotten and needed to be overhauled. From holding up or threatening to hold up all promotions for a particular service (yes, this was long before Senator Tuberville's actions, check out Senator Schroeder's threats following Tailhook) to working to remove the commander's discretion in dealing with these cases, these officials worked to eat away at the protections for accused service members, both by altering procedural protections and by working to send a message to the command team that "not guilty" verdicts would endanger careers and funding for much-desired weapon systems and support.

It was into this environment that this Lieutenant Colonel sent his e-mail. Perhaps the most pernicious and dangerous issue within the military justice system is something called "command influence." Command influence occurs when a commander or someone with significant authority intervenes in the judicial process by ordering jurors to vote for a specific result, or by establishing policies mandating particular results in military legal cases, or by threatening service members' careers if specified results are not achieved. The actions of these female lawmakers and their threats to senior military leadership were clearly aimed at eliminating "not guilty" verdicts in sexual assault cases and limiting the discretion of commanders to deal with these issues in any other way than a trial, where the results would be effectively guaranteed. In other words, command influence at its very worst.

The Secretary of the Army doesn't understand her job. She fails to grasp the idea that civilian control of the military does not mean that military lawyers must act to abrogate the statutory and constitutional rights of their clients in service to a particular ideology or political philosophy. I'm sorry that this general did not stand up and act like a big dog, telling this SECARMY that she cannot undercut the ability of defense counsel to zealously defend their clients, even in Army courts. With any luck, the story will be offered as evidence of command influence on upcoming sexual assault trials and will be sufficient to overturn guilty verdicts. 

DoD Accountability

 I have no particular insight into what is going on with the Secretary of Defense and his doctors,  but as a former military officer and corporate executive I make the following observations: 

- a subordinate officer with command authority in any branch of the armed forces who failed to inform his commander that he would be offline, in the hospital, and unable to respond to calls or requests for information would be fired. Likewise someone in a corporate position of similar responsibility. 

- a second in command who failed to adequately apprise herself of the circumstances involving her boss's absence, and who failed to immediately make herself available by being physically present in her boss's stead, and who failed to notify the people to whom she was ostensibly reporting that she was ready for duty, would be fired. 

- Anyone in the organization with knowledge of the boss's absence and the fact that this had not been communicated to the command structure, along with no communication of the process for decision-making in the boss's absence, who failed to remedy the situation, would be fired. 

- a senior commander who tolerates the above behavior in her subordinates without removing them or taking other comparable disciplinary action is not a competent leader or manager and should be removed. 

Update:  Given that it now appears that deception and disguise concerning his condition was the game from the very outset, the SECDEF should be removed forthwith.  

Horrible Harvard Hiring

 I know this topic has been beaten to death but I thought I would throw my two cents in on the Claudine Gay situation. As an employment lawyer, what jumps out at me first is the fact that her situation is exactly what you would expect when your primary criteria for hiring are something other than merit or past performance. Harvard's corporate board obviously weighted Gay's race and gender, and perhaps her political philosophy, much more highly than it did prior academic performance or even job performance in previous administrative positions. She had not distinguished herself academically and in her previous administrative roles presided over several high-profile and dubious decisions by Harvard leadership. Does it come as any particular surprise that her performance in front of Congress and since has been substandard? 

What is even more interesting, again from an employment lawyer's perspective, is that Harvard has moved Gay from a position where she was likely unqualified into a position where she is almost certainly unqualified. The plagiarism examples in her past written work, apparently accompanied now by claims that she actually falsified data, may or may not indicate a lack of qualification for an administrative position at Harvard. But these examples are surely disqualifying for a full professor teaching courses to students held to a rigorous and punitive anti-plagiarism standard. How does Harvard now justify either disciplining or not hiring anyone with plagiarism or equally serious conduct in their background? The Harvard Corporation BOD has lowered the bar on standards of conduct quite a bit.