Federal Judge Says School District Flunks Its Obligation to Educate Students Who Don’t Speak English by Making Them Take Class Taught Only In English

A decision issued by federal Judge Edward G. Smith in Pennsylvania last Friday confirms our faith in the ability of the legal system to get it right. The issue was whether 5 students living in Lancaster County, Pennsylvania, who came from Somalia, Sudan, Democratic Republic of Congo, and Burma had a right to attend a school run by the Lancaster County School District that includes a program to teach English to non-English speakers. The School District forced the children to attend a separate, academically inferior high school run by a for-profit corporation under contract with the School District. None of the students speaks English. All instruction at the separate school is in English. Judge Smith said that “[o]n its face, this practice appears to be counterintuitive; expert testimony confirmed that the practice was unsound.”

Judge Smith held that the students had made out a strong case that the School District had violated state and federal law and issued a preliminary injunction in their favor. Speaking of the students, he said: “They all escaped violence and tumult in their home and other lands. Now in America, all earnestly seek to learn English, advance their education, and contribute to society.”

We never applaud judges for getting it right, because that’s their job, but we are grateful. We are also grateful to the Education Law Center, the ACLU of PA and the law firm of Pepper Hamilton for bringing the case on a pro bono basis. Anyone who would like to read Judge Smith’s decision can find a copy here (https://www.aclupa.org/download_file/view_inline/2806/1030/).

How Hulk Hogan Scored $140 Million in a Single Lawsuit

Surely the most salacious legal development of 2016 (so far) is Hulk Hogan’s $140 million verdict in March from a Florida court against the online media company and blog network Gawker Media LLC for publishing a video of him having sex with the wife of his then friend, a radio personality by the name of “Bubba the Love Sponge Clem.” Gawker’s conduct must have angered the jury. It didn’t help when a former Gawker editor acknowledged at trial that he had said at his deposition that there would be a public interest in promoting child pornography of the children of celebrities if they were over the age of four, but claimed that he was just being sarcastic. The case took on renewed interest with the disclosure in late May that billionaire tech investor Peter Thiel provided $10 million in litigation funding for Hulk (real name Terry G. Bollea) to get revenge against Gawker for outing him as gay several years ago.

The prurient aspect of the case of course sells newspapers and drives clicks, but the case also raises the issue whether the First Amendment interest in Gawker’s publication of a video about a public figure outweighed Hulk’s interest in privacy. We leave that issue for others to discuss and for the appeal. Our interest in is the nuts and bolts of how the plaintiff’s legal team got the jury to award $140 million verdict in a single plaintiff case not involving death or serious bodily injury.

The case was originally filed in October 2012 and took over three and a half years to get to a trial. The trial lasted two weeks. The cause of action was not defamation. It was intentional infliction of emotional distress and invasion of privacy. The jury awarded $55 million in economic damages based on expert testimony that Gawker had been enriched by all of the site traffic drawn by the video, $60 million in emotional distress damages based on the testimony of Hulk and one other fact witness about the emotional distress Hulk felt, and $25 million in punitive damages in a second deliberation. The collectability of the verdict is unknown, although media reports have suggested that the case and other pending defamation cases against Gawker threaten its existence. Gawker has already begun the appeal.

The takeaway for those who follow litigation as a matter of business is that in today’s litigation climate, large jury verdicts can be expected—even without death or bodily harm—where harm to economic, reputational, or emotional interests arise out of proven misconduct. Punitive damages are not necessarily the key to a large recovery; economic damages can result in large verdicts and emotional distress damages in particular can be significant because they are unlikely to be disturbed by the trial court or on appeal. We don’t hear about these cases all that often because they settle or because plaintiffs cannot afford or find litigation counsel ready to bring the case to trial. Whether or not the Gawker Media verdict stands on appeal, the message to defendants who inflict economic and emotional harm on others is clear: beware the consequences when the case finally gets to the jury.

New Law Creates Federal Trade Secrets Cause of Action

New Law Creates Federal Trade Secrets Cause of Action

On May 11, 2016, President Obama signed into law the Defend Trade Secrets Act (DTSA), which provides a federal cause of action for trade secret misappropriation. Prior to the DTSA, plaintiffs seeking to enforce trade secrets rights relied exclusively on state law; most states have adopted the Uniform Trade Secrets Act (UTSA).

With limited exceptions, the rights granted under the DTSA are the same as under the UTSA. The basis for liability is the same. The damages are the same. Both the UTSA and the DTSA permits the recovery of enhanced double damages and attorneys’ fees for willful misappropriation of trade secrets.

One difference is that the DTSA provides immunity to whistleblowers who disclose trade secrets to law enforcement officials, or to an attorney, for the sole purpose of reporting or investigating a suspected violation of law. The DTSA provides immunity to parties who disclose a trade secret in a lawsuit, if the disclosure is made in a filing made under seal. The DTSA also requires employers to provide notice of this immunity in a contract or agreement with an employee that governs the use of trade secrets. Employers who fail to provide such notice are barred from recovering enhanced damages and attorneys’ fees.

Note to practitioners: employers who are concerned about the potential for trade secret misappropriation will want to update their policy manuals, employment contracts, or other employment materials to give the notice required by the DTSA if they want to take advantage of the possibilities for recovering enhanced damages and attorneys’ fees.

Another difference is that the DTSA forecloses the possibility of injunctive relief based on the inevitable disclosure doctrine. The DTSA requires evidence of threatened misappropriation before an injunction will issue. This differs from the law in many states, which authorize injunctive relief where use or disclosure of trade secrets is inevitable even if not yet proved.

Unlike the UTSA, the DTSA provides for ex parte civil seizure in extraordinary circumstances. Courts can issue seizure orders where the party against whom the seizure would be ordered misappropriated or conspired to misappropriate the trade secret at issue and is in possession of the trade secret. Such orders are appropriate where an injunction is insufficient because the party against whom the injunction order would be issued would not comply with the order.

The Bottom Line—Trade Secret Plaintiffs Can go to Federal Court if They Want

The differences between the DTSA and the UTSA will only matter in rare cases, with one exception: the right to bring suit in federal court. The DTSA ensures that every plaintiff who wants to bring a trade secrets claim in federal court can do so. But if there is no other basis for federal court jurisdiction (such as diversity of citizenship), a plaintiff can file in state court and avoid removal to federal court simply by pleading a state law trade secrets claim without reliance on the DTSA. This option to proceed in federal court now provides an important advantage for plaintiffs in trade secrets cases.

 

 

 

A Student Loan Bill of Rights

In an effort to address the ongoing student loan crisis, Connecticut has become the first state to enact a student loan bill of rights. This law will serve as way to more closely monitor the lenders in this industry, as well as provide student borrowers with necessary education and resources.

The law creates a Student Loan Ombudsman who will resolve complaints, analyze data, and provide more education to borrowers. Education courses will be created for borrowers so they are better able to understand their rights and responsibilities associated with the debt.

It is abundantly clear that we need more education on student loans, but we also need to shut down unscrupulous lenders and education institutions. This law will provide a centralized way to do just that.

Borrowers must be better informed about their rights and options so they can make sound financial decisions as they embark on the path to higher education. This law is a good example of what can be done at the state level to better understand and address the problem of runaway student loan debt.

Hopefully other states will follow Connecticut’s lead. The student loan crisis will not solve itself and it’s critical that the government start taking action to find workable solutions to a problem that has the potential to affect the lives of tens of millions of Americans.

 

RG-3Rachel Gallegos

Lead Consumer Advocate, Steve Harvey Law

 

 

Supreme Court Rules in Favor Of Muslim Woman Who Wore Head Scarf to Job Interview

Employers must continue to ensure that applicant’s religious practices are not a factor in hiring decisions. So said the Supreme Court this week. The Court ruled Monday in favor of a Muslim woman whom Abercrombie & Fitch refused to hire because she had worn a hijab—a traditional Muslim head scarf—when she interviewed for a salesperson position at a retail store in Tulsa.[1] Then-17-year-old Samantha Elauf did not mention the hijab or her religion in her interview, but the interviewer assumed she was Muslim and that she wore the hijab for religious reasons.  Evidence suggested the hijab influenced the decision not to hire her because it conflicted with Abercrombie’s “look policy,” which required sales persons to wear “classic East Coast collegiate style of clothing.”

The EEOC initially won summary judgment on Ms. Elauf’s behalf, but the Tenth Circuit Court of Appeals reversed that decision, reasoning that Ms. Elauf had failed to notify Abercrombie of her need for a religious accommodation.

Writing for the majority, Justice Scalia confirmed that an applicant need not make a specific request for religious accommodation to obtain relief under Title VII of the Civil Rights Act of 1964, which prohibits religious discrimination in hiring: “Title VII forbids adverse employment decisions made with a forbidden motive, whether this motive derives from actual knowledge, a well-founded suspicion, or merely a hunch.”

Justice Scalia called it a “really easy decision.”

The decision reconfirms that an employee’s religious practices may not be a factor in employment decisions—whether or not the employer has actual knowledge, or merely presumes or suspects, that those practices are based on religious beliefs.

The Court’s vote was 8-1, with Justice Clarence Thomas dissenting. The decision is in line with the Court’s recent broad view of religious rights, following last year’s Burwell v. Hobby Lobby[2] decision in which the Court found broad religious freedom rights for corporations, and Holt v. Hobbs,[3] in which the court found that a ban on beards infringed on the religious rights of prisoners earlier this year.

 

Therese K. Dennis

Counsel, Steve Harvey Law

 

 

[1] EEOC v. Abercrombie & Fitch Stores, Inc., Docket No. 14-86 (June 1, 2015)

[2] Docket No. 13-254 (June 30, 2014).

[3] Docket No. 13-6827 (January 20, 2015).

Survey Shows Mortgage Servicing Still a Problem

For those facing foreclosure, problems persist in dealing with servicers. A recent National Consumer Law Center survey of consumer advocates and housing counselors about their experiences with the mortgage servicing industry revealed ongoing problems. These problems have been present since the financial crisis began in 2008 and unfortunately continue on today.

Successors in interest (heirs, widows, and orphans) often have trouble getting even basic information about the loan as the lender does not view them as valid parties of interest. There are unnecessary hurdles in place that prevent these cases from reaching simple resolutions that would allow the successor to resume payments, keep the home, and ensure that the loan remains performing. Resolving this problem is a win-win situation for the lender and successor, and it can be accomplished with basic changes to the system and more education to all stakeholders about current regulations and requirements.

Repeated requests from servicers for documents from the homeowner is another consistent complaint. It can be an endless cycle for the homeowner and can prevent resolutions for homeowners with the capacity to pay. The definition of a “complete package” can vary depending on a borrower’s financial circumstances, and it can be difficult to get a clear answer from a servicer about which documents are needed. Servicers often ask for documents in a piecemeal fashion, or ask for the same document repeatedly with no explanation as to why.

Mortgage foreclosure suffers from issue fatigue, but it’s important that we continue to work on this problem in an effort to stabilize families and communities. A homeowner dealing with foreclosure should seek help from an experienced advocate (housing counselor or lawyer) to assist in navigating what still proves to be a complicated process.

 

RG-3Rachel Gallegos

Lead Consumer Advocate, Steve Harvey Law

 

Consumer Financial Protection Bureau Takes on Student Loan Servicing

We are in the midst of graduations across the nation and it can be a bleak picture for graduates looking for employment. Finding a job in a specific field can be difficult, but students must also take into account looming student loan payments. Large student loan payments prevent students from making other financial investments and this has long-term repercussions for the student borrower as well as the entire economy.

The Consumer Financial Protection Bureau recently announced that it is soliciting comments from the public about borrower experiences with student loan servicing. CFPB Director Richard Cordray stated that “[t]he inquiry seeks to determine if the student loan servicing industry is doing things that make repayment more complicated and more costly for consumers.

The CFPB has taken an active role in monitoring and regulating various consumer industries such as payday loans, mortgage servicing, and credit cards. It is not surprising to learn that in light of the staggering statistics about student loan debt, the CFPB is now taking action.

There is a lot of room for improvement in terms of regulating lenders and servicers. It is good to know that the voices of student borrowers are finally being heard. Hopefully those facing crushing debt loads will soon find some relief.

 

Rachel Gallegos

Rachel Gallegos

Lead Consumer Advocate, Steve Harvey Law

The Corinthian Colleges Closure and Debt Cancellation Debacle

Any discussion about student loan rip-offs should begin with Corinthian Colleges. The recent closure of this for-profit company left thousands of students stranded with no way to complete the education they had been promised and for which they took on crushing debt loads.

The Department of Education has announced that students who were enrolled or recently withdrew from school will be forgiven their federal loans but only if they forego credits they already earned. Students who have already graduated get no such relief. According to US News & World Report, some of the former students are also now challenging repayment of their student loans based on claims of fraud.

The closing of Corinthian Colleges brings up the issue of debt cancellation in the student loan context. If you have federal student loans, in certain circumstances such as school closings your debt can be canceled. You must be enrolled at the time of closing or have withdrawn from the school within 120 days of the closing.

Prior to the closure of Corinthian Colleges, the Consumer Financial Protection Bureau announced that $480 million in loan forgiveness will be made available for students who took out Corinthian Colleges high-cost private student loans. This is highly unusual as the protections and safeguards offered for federal loans normally do not exist for private loans. Loan forgiveness and debt cancellation are rare in the private loan context. Students are ordinarily left to negotiate directly with the private lender in hopes that the payments can at least be an amount that is affordable each month.

Corinthian Colleges is the tip of the of the student loan crisis iceberg. The student loan program in this country is not serving us well and cries out for reform.

 

RG-3Rachel Gallegos

Lead Consumer Advocate, Steve Harvey Law

 

The Foreclosure Crisis: It’s Not Over Yet, and Not Even Close in NJ

The Philadelphia Inquirer reports that 1 in every 234 homes is in some stage of foreclosure in New Jersey. This is a 17% increase over 2014 and clearly shows that the crisis in not over yet. While New Jersey is unique in its rate of foreclosure, the issue still plagues many homeowners nationwide.

In New Jersey, the high rate of foreclosures is also due to “robo-signing” issues in recent years. Those legal issues created a back-log of foreclosures and the flood gates have since opened. Homeowners in New Jersey and nationwide are also still fighting against decreased property values, unemployment, illness, and mounting debt.

Foreclosures destroy communities and do not benefit the homeowner or the lender. A resolution in which the homeowner stays in the home and continues to make payments is in everyone’s best interest. There are many options available for homeowners to resolve a foreclosure but the process can be overwhelming. Families facing foreclosure should immediately contact an attorney or housing counselor to seek assistance.

 

RG-3Rachel Gallegos

Lead Consumer Advocate, Steve Harvey Law

 

Education at a Cost

Student loan debt plagues the nation. Over 40 million people in the United States have student loans and approximately 7 million borrowers are in default. Higher education leads to higher paying and more satisfying work for life, but a crushing debt load can consume the pay and kill the satisfaction.

In this article, the New York Times highlights the problems with student loan counseling offered to students. Research has found the information currently provided to students to be confusing and irrelevant. It also assumes a knowledge base that simply isn’t there.

Students need to be educated on the ins and outs of student loans before being asked to take on tens of thousands of dollars in debt. Much time is spent telling students that higher education is crucial to their success, but too often the crushing debt incurred to achieve that education drastically alters the future for students after graduation.

The system needs an overhaul. There are basic changes that can be made in this arena such as more financial counseling while student are in school, face-to-face contact with experts, and different ways of communicating needed information such as videos. Schools and lenders must do a better job educating students about the debt they are taking on and what it means for their future. Because their future is our future.

 

– Rachel Gallegos