February 5, 2016

Class Action Lawsuit May Bring Greater Transparency to PayPal

PayPal may soon bring to an end an ongoing class action lawsuit that it has been fighting since 2010. Parties to the case, known as Zepeda vs. PayPal, have reached a tentative settlement agreement over allegations that the online payment company utilizes an unlawful freeze on accounts.

PayPal%20Corp-001.jpgMoises Zepeda and other members of the class are frequent sellers on eBay, the online auction website. They typically received payment via PayPal, which touted itself as being more secure and convenient than other payment methods. However, Zepeda and others noticed that the funds they received from buyers in their PayPal accounts were often subject to a hold of up to 180 days. PayPal claimed that the holds or account freezes were necessary to combat fraud. Plaintiffs didn't believe that the account freezes served any useful purpose. In addition, having their PayPal account frozen for an extended period of time made it difficult to do business.

The class filed the lawsuit in 2010, and it has required five years to even reach a tentative settlement agreement. While presiding over the possible agreement, the judge noted the "long and tortured history" that the parties to the case have endured. The proposed, approximately four million dollar settlement seems to be a step in the right direction, but only time will tell if it brings about any real changes. Thus far, PayPal has admitted to no wrongdoing, and they don't appear to be willing to make sweeping changes to their account freeze policies.

However, PayPal seems ready to agree to provide users with more information when a hold is placed on their account. Customer service callers can ask why a hold is in place, and now PayPal staffers must tell them the reasoning behind the hold if it does not violate security measures.

Time will tell if sellers are satisfied with these results. Considering how hotly contested the case has been up to this point, it will be a minor miracle if the settlement agreement is even finalized. Consumers may benefit from new disclosure standards that PayPal will have to comply with, allowing for greater transparency.

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January 29, 2016

California Bill Would Make Encrypted Smartphones Illegal

Jim Cooper, a member of the California Assembly, has proposed bill AB 1681. The bill is designed to outlaw the sale of encrypted smartphones beginning on January 1, 2017. Any retailer who sells an encrypted phone to a consumer after that date would be subject to a $2,500 fine for every violation of the act.

search%20cell%20phone%2061969338-001.jpgThis move to end unbreakable encryption on cell phones comes as a joint effort between law enforcement, politicians and victims of crimes. It seems that even when law enforcement gets a court order allowing them access to a suspect's smartphone, they usually can't get around the encryption software. This holds true for the manufacturers of the phone and the operating system. Executives from those manufacturers say that they have no means of successfully getting around typical smartphone safeguards.

Proponents of the bill are particularly concerned with stopping human trafficking. They argue that encrypted smartphones are used to carry out these crimes, yet police cannot use them for evidence because of encryption programs. Their hope is that pimps and other participants in human trafficking networks can be more easily caught and prosecuted when smartphone evidence is readily available.

Critics say that completely doing away with encryption is a mistake, not to mention a violation of fourth amendment rights. Encryption is what makes people feel secure when it comes to accessing or working with financial and other sensitive information on their cell phone. Without encryption, consumers would be more vulnerable to several varieties of identity theft and other violations.

Critics also note that selling fully unencrypted or easily decrypted phones is not necessarily a viable solution, especially since several encryption apps are readily available. It would not be difficult for a person to buy an unencrypted phone and then install encryption software that law enforcement and smartphone manufacturers may not be able to break, leaving police in the same predicament they occupy today.

Much debate is likely to ensue before the bill is voted on. Blanket solutions sometimes introduce more issues than they resolve, which may be the case with making encrypted smartphones illegal in California.

January 15, 2016

San Francisco Yellow Cab Co-Op to File Bankruptcy Amid Uber/Lyft Competition and Lawsuits

An ongoing series of setbacks appears to be forcing San Francisco-based Yellow Cab Co-Op to file for bankruptcy. Company executives sent a letter to each of the cab drivers who work for the co-op in December of 2015 that lays out a plan for the future. Drivers can expect to maintain their employment, but things may have to change dramatically for the co-op to be financially viable again.

Taxi%2028530953-001.jpgOne of the setbacks that is having a detrimental effect on Yellow Cab's bottom line is the upsurge of passengers using tech-based competitors like Uber and Lyft. Both of these apps are widely used on smart phones, enabling users to catch rides quicker and often at a lower rate than those charged by cab companies.

However, representatives from Yellow Cab argue that Uber and Lyft drivers are not subject to the same rigorous background checks that they must undergo. Also, cabbies opine that many of the drivers who work with Uber and Lyft just don't know the city streets as well as they do. Cabbies further cite their superior insurance protection as an additional reason why customers should choose their service over the services of their rivals.

The other setback that is affecting Yellow Cab's profitability is the amount of money they've had to shell out as a result of personal injury litigation. Company officials note that they have been ordered by courts to pay numerous sizable settlements in the last couple of years. One of these cases in particular, Fua v. Sanchez, resulted in an eight million dollar award to plaintiff Ida Fua. The left side of Fua's body was paralyzed when the Yellow Cab she was riding in crashed into other cars at 60 mph. This award, combined with other sizable judgments, severely impaired Yellow Cab's financial stability.

Yellow Cab is likely to file for Chapter 11 bankruptcy soon. This reorganization bankruptcy will discharge many of the company's debts, and neither drivers nor passengers should be affected. However, company officials say that they will need to hire more drivers if they want to become more profitable in the future.

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January 8, 2016

California's Fair Pay Act Forces Employers to Assess Worker Paychecks

Now is an excellent time for employers to assess their compensation policies. That's because the New Year activated California's Fair Pay Act. Analysts say it's one of the country's toughest equal pay laws, and the consequences are serious for companies that are found to be in violation.

Fair%20Pay%2070618813-001.jpgThe new legislation was signed in October 2015 by Governor Jerry Brown. It's essentially an amendment to the state's existing fair pay laws, which have been in place for several decades. Federal laws also ensure equal pay for workers regardless of gender or other characteristics. However, this new legislation puts more of the onus on employers to ensure that they are fairly paying employees.

Democratic state senator Hannah-Beth Jackson introduced the bill earlier in 2015 in the wake of actress Patricia Arquette's Oscar acceptance speech that called for an end to the gender pay gap. A key component of the new law is the requirement for employers to be able to prove that they are paying employees of both sexes the same compensation for "substantially similar work." The law asks employers to look beyond titles, assessing actual duties performed and responsibilities assumed, when settling questions of pay. If disparities exist between the compensation for male and female workers who perform substantially similar work, then the employer must be able to articulate a non-gender based reason why the disparity exists.

Employers can use distinctions like seniority and merit to justify offering higher compensation to men when compared to women in a similar role. It is advisable for employers to assess and document such decisions in case questions or disputes arise at a later date. Similarly, the new law is forcing many employers to dig deep into company archives to assess the current salaries of employees and decide whether or not such disparities already exist.

While a full-scale, company-wide audit of employee compensation is neither easy nor inexpensive, it is far preferable to being made the subject of a class-action lawsuit. Employers may want to contact employment law attorneys to learn more about how to protect themselves in light of the new fair pay law.

December 24, 2015

Happy Holidays


The Sylvester Oppenheim & Linde Team Wish You and Yours a Wonderful Holiday Season and a Happy, Healthy & Prosperous New Year

December 11, 2015

Student Sues School After Being Expelled for Selling Pot Brownies

A Connecticut teen and his family are suing the boy's former school. The lawsuit alleges that the boy was inappropriately expelled after an incident in which the boy is accused of selling pot-laced brownies to fellow students.

pot%20brownie%2070921206-001.jpgThe incident began on June 11, 2014. Joshua Walker-Thomas was an 18 year-old student at Metropolitan Learning Center, a magnet school for students in the sixth through twelfth grades. He and two accomplices, a boy and girl both aged 16, sold pot-laced brownies to eight students. One of the purchasers was later found by school officials in a stupor while hyperventilating. The student had to be transported to a hospital for treatment. Both Walker-Thomas and the 16 year-old girl were charged with risk of injury to a minor. Those felony charges are still pending. The third participant, who has not been identified because of his age, was not charged with a crime. Nonetheless, the school confronted him about his involvement. He was suspended from June 12 onward.

However, the lawsuit filed by this student's family alleges that the school mishandled the suspension and subsequent expulsion from beginning to end. Among the allegations is the fact that the expulsion hearing did not occur until September when such hearings are supposed to take place a mere 10 days after the suspension, a requirement stipulated by state law. Moreover, the boy's family argues that they were not informed about the expulsion hearing until the day before it occurred, giving them no opportunity to review the evidence. The lawsuit contends that the boy's right to due process was ignored.

Other allegations also appear in the complaint. According to legal documents, the hearing officer at the expulsion hearing offered no evidence to support the possession or sale of illegal substances by the student. The lawsuit also protests that no audio recording was made of the hearing and further that the student's diagnosis with ADHD was not taken into consideration.

School districts always need to ensure compliance with state laws when meting out disciplinary action.

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December 4, 2015

Allegiant Airlines Fires Pilot Over Emergency Evacuation

An Allegiant Airlines pilot has been fired after an incident at the St. Petersburg/Clearwater International Airport. Allegiant claims that the pilot endangered all passengers and crew aboard a flight while the pilot contends that he was acting in the interest of everyone's safety. A lawsuit recently filed by the pilot may decide which party has the law on their side.

Fired%2053061626-001.jpgPilot Jason Kinzer had been working for Allegiant for three years, having been promoted to pilot in December 2014. Since that time, he maintained a clean record without any safety violations. In June, he was piloting a twin-engine MD-80 out of the St. Petersburg/Clearwater airport. Nearly 150 passengers and crew members were on board. It wasn't long after takeoff that Kinzer received a phone call from one of the flight attendants. Kinzer described her as being frantic. It seemed that several passengers were smelling smoke in the cabin.

Thinking quickly, Kinzer turned the plane around and made an uneventful landing at the airport they had just left. Emergency personnel met the plane on the runway, quickly confirming that one of the engines was on fire. Kinzer ordered the evacuation of the aircraft. Inflatable slides were deployed and everyone left the plane. However, before the evacuation took place, Kinzer received a strange transmission over the radio from an unidentified person who suggested that evacuation was unnecessary. Kinzer asked who was speaking but did not receive a reply. The evacuation commenced. However, four passengers were injured while leaving the aircraft via the slide.

Kinzer waited for several weeks while Allegiant investigated the incident. Eventually, he received a telephone call telling him that he was being terminated for putting the lives of the passengers in jeopardy unnecessarily. Allegiant's officials didn't believe the evacuation was warranted, especially in view of the injuries sustained by the four passengers.

It is likely that the lawsuit may bring to light some additional information which might help better understand Allegiant's actions in this matter.

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November 25, 2015

Happy Thanksgiving from Sylvester Oppenheim & Linde

We at Sylvester Oppenheim & Linde would like to take a moment to wish our clients, family and friends (including our blog readers), a very joyous and happy Thanksgiving.

Whether you are celebrating with a small gathering, or preparing for what is shaping up to be dinner for a small country, we wish you and yours all the very best.

It also seems appropriate to quote John F. Kennedy.

"As we express our gratitude, we must never forget that the highest appreciation is not to utter words, but to live by them."


November 20, 2015

NLRB Decision on GPS Could be a Win for Employers

The NLRB handed down a decision that appears to be a win for employers. In the case of Shore Point Distribution Co., the NLRB found that there was no wrongdoing on the part of the employer when they installed a GPS tracking device in an employee's work truck. The device helped the employer prove that the employee was stealing time and was instrumental in the employee's dismissal.

GPS%20navigation%2085141634-001.jpgShore Point became suspicious of the employee, a route driver for the beverage distribution company, who seemed to take significantly longer on his routes than other drivers. Suspecting that the employee was stealing time, the employer hired a private investigator to follow the driver. Shore Point's employees are unionized. A bargaining agreement allowed the employer to engage a private investigator for this purpose. However, Shore Point went further by installing a GPS tracker in the driver's work truck.

The use of GPS devices is not specifically included in the existing bargaining agreement. This became a point of contention between Shore Point and the union, with the union arguing that the employer should have bargained for the right to install the GPS unit. On the surface, it looked as though the NLRB might agree with the union. However, they went the other way.

The NLRB found that the GPS was only used by the private investigator once to locate the employee when he temporarily lost sight of the truck. Because this use did not seem to materially affect the conditions of employment, the NLRB argued that Shore Point did not have to bargain for the right to install and use the device.

This decision seems like a win for employers, but it still makes a great deal of sense to proceed with caution before installing GPS devices on company vehicles.

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November 6, 2015

Federal District Court Rules in EEOC v. AutoZone: Disability Discrimination Case to Proceed as Filed

The EEOC has announced that a federal district court has denied a request by AutoZone to limit the scope of a nationwide disability discrimination case. The case was originated by the EEOC.

Discrimination%2040134433-001.jpgAutoZone argued that the EEOC did not conduct an adequate, "nationwide" investigation prior to filing suit and asked the court to limit the suit to only three stores.

"[T]he Court may not inquire into the sufficiency of the EEOC's pre-suit investigation in order to 'limit' the scope of the litigation," the court stated in its order, which was written by U.S. District Judge Robert M. Dow, Jr.

The order also cited the recent decision in Mach Mining, LLC v. EEOC, in which the Supreme Court stated that courts should not impose additional procedural requirements on such litigation beyond those established by Congress.

EEOC filed suit on May 9, 2014, alleging that from 2009 until at least 2011, the company assessed employees attendance "points" for absences, without permitting any general exception for disability-related absences. The complaint alleges, qualified employees with disabilities with even modest numbers of disability-related absences were fired, in violation of Title I of the Americans with Disabilities Act (ADA). The ADA prohibits disability discrimination in employment, which includes failure to provide reasonable accommodations to qualified individuals with disabilities.

John Hendrickson, regional attorney for EEOC's Chicago District. Stated “This case alleges a serious violation of the law and should be decided on the merits. The Supreme Court's recent decision in Mach Mining should put to rest efforts to deny employees their day in court based on unfounded arguments about administrative procedure."

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October 30, 2015

Settlement of P.E. Lawsuit Brings Changes to California School Districts

Childhood obesity is a hot topic, and a settlement in a California lawsuit is aimed at tackling that issue. Attorney Donald Driscoll took on the case in 2013, working on behalf of advocacy group Cal200 and parent Marc Babin. The lawsuit involved 37 school districts, which are responsible for educating one in five of all California elementary school students, and alleged that children were not receiving enough physical education.

school%20bus%20%26%20child%2044980077-001.jpgCalifornia requires that elementary school students receive at least 200 minutes of P.E. instruction every 10 school days. Previously, there were no reliable methods for tracking this time. Many teachers understood the 200 minutes requirement to be a suggestion, leading them to sometimes choose preparation for standardized tests over physical activity.

The settlement of this lawsuit demonstrates that the 200 minute minimum is a mandate rather than a suggestion. Moreover, school districts involved in the settlement are now facing strict reporting requirements. Some districts, like San Bernardino and Riverside, say that they have already enacted reporting strategies.

As part of the settlement, districts are now required to monitor the time that elementary school teachers spend on P.E. instruction. Teacher P.E. schedules must be publicly posted and teachers are also required to sign forms certifying that they are meeting the state-required minimums. School principals are being required to make surprise classroom visits to ensure that the requirements are being met.

In the Riverside Unified School District the technology department has already rolled out purpose-built software that is designed to help teachers and administrators comply with the reporting requirements. Teachers keep track of their P.E. minutes online, printing reports every two weeks to be passed on to principals for review. The principals sign the forms, and the school board receives an official report three times per year.

The other outcome of the litigation is new legislation aimed at curbing costly and time-consuming lawsuits against school districts. Complaints are now required to go through an administrative process that must be completed before a lawsuit can be filed. Hopefully, this will help districts direct more funds toward students and classrooms.

October 22, 2015

Was Chico Unified School District Protecting or Withholding Information?

The Chico (California) Unified School District wasn’t trying to keep information from the public when it sought to block emails from being released under public records laws, according to two district officials who were involved in the case. Instead, they say, the district’s lawsuit against a university where some officials moonlighted was merely an attempt to prevent legitimately confidential emails from being released.

Privacy%20Policy%2046679502-001.jpg“The only reason why we ended up in a lawsuit was to protect people,” said Andrea Lerner Thompson, who is a former member of the school board. Indeed, Lerner Thompson and current member Kathy Kaiser claim to have supported releasing the records. However, because both women used their university email accounts to handle public business for the district, they argued that no emails from those accounts should be released because legitimately confidential university information might be leaked in the process.

The problem began when a former principal for the district, Jeff Sloan, requested copies of all district-related emails. When it came to light that Kaiser and Lerner Thompson, along with fellow officials Bob Feaster and Rick Rees, had been using their Chico State University staff email accounts to handle district business, Sloan requested copies of those emails.

The women claim that they used the university accounts for district emails for the sake of convenience only. Even though the practice effectively hid district business records from being discovered in a district records search, Lerner Thompson says no one was attempting to circumvent laws requiring public access to district documents.

When the case reached the Butte County Superior Court, it was dismissed by Judge Barbara Roberts because all involved parties had finally agreed on a resolution. Prior to the court date, a court-appointed special master had reviewed the situation and all sides had agreed on a plan that would protect confidential university emails and release only district-related emails.

In an unfortunate twist, some confidential information included in the released emails was not properly redacted from the documents. This information was made public when the records were made available online. The emails have since been removed from the Internet.

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