Massachusetts Employment Law Letter

Long time no term?

Most employers understand that terminating an employee right after he has filed a lawsuit for discrimination can put the employer at risk for a retaliation claim.  But what about terminating an employee five years after he filed the lawsuit?  The following case illustrates that, if there is other evidence of a retaliatory motive, it doesn’t matter how much time has passed between the employee’s lawsuit and his termination.

Doctor files age claim

Dr. José Alfonso Serrano Muñoz began working as a cardiologist at Auxilio Mutual Hospital, located in San Juan, Puerto Rico, in 1978.  During his time at the Hospital, Serrano helped establish the Hospital’s Noninvasive Cardiovascular Laboratory (“NICL”) and its Invasive Cardiovascular Laboratory (“ICL”), and Serrano became director of both departments.  Like many other doctors, Serrano also engaged in private practice in leased office space on the Hospital’s grounds.

In 1997, the Hospital relieved Serrano of his directorship of ICL, stating that it wanted Serrano to focus on his responsibilities as director of NICL.  Serrano believed that the decision was motivated by age discrimination, and he filed a lawsuit against the Hospital in 1998.

Machine at the heart of the dispute

Prior to filing his lawsuit, Serrano had requested permission from the Hospital to purchase an electrocardiography machine for use in his private practice.  The Hospital denied that request citing a policy against allowing doctors to keep expensive equipment already owned by the Hospital.  The Hospital did tell Serrano that doctors practicing in the Hospital’s new medical office building, which was then under construction, would be able to have their own equipment.  In 2001, Serrano moved his practice to the new medical office building, and in 2003, he acquired an electrocardiography machine and began conducting echocardiograms in his office rather than referring patients to NICL for their echocardiograms.

The Hospital noticed that a decline in the number of outpatient diagnostic tests conducted by NICL correlated with Serrano’s acquisition of the echocardiography machine.  The issue was raised at the Hospital’s December 2003 board of directors meeting, and the Hospital’s board members were unhappy that Serrano was competing with the Hospital by administering his own echocardiograms.  The board chair added that “Dr. Serrano show[ed] a constant dissatisfaction with the services rendered by the Hospital, and is opposed and openly criticizes – verbally and in writing – all the Hospital’s initiatives.”  During that meeting, the board voted unanimously to terminate Serrano’s employment.

Delay defense

Serrano sued the Hospital, claiming that it had terminated him in retaliation for filing his age discrimination lawsuit in 1998, five years prior to his termination.  A jury found in favor of Serrano and awarded him nearly $2 million in damages.  The Hospital appealed the jury’s decision to the First Circuit Court of Appeals, arguing that, based on the evidence presented at trial, no reasonable persons could have reached the conclusion that the jury reached.

In order for an employee to succeed on a retaliation claim under the Age Discrimination in Employment Act (“ADEA”), he must first show that:  (1) he engaged in ADEA-protected conduct; (2) he was thereafter subjected to an adverse employment action; and (3) a causal connection existed between the protected conduct and the adverse action.  Once the employee shows these three things, the burden shifts to the employer to state a legitimate, non-discriminatory reason for its employment action.  If the employer has such a reason, the burden shifts back to the employee, who can only prevail if he can show that the employer’s stated reason is a pretext for retaliation.

The Hospital argued that, because of the five-year gap between Serrano’s lawsuit and his termination, no reasonable jury could conclude that there was a causal relationship between the lawsuit and the termination.  The court agreed that that would be the case if the timing of the lawsuit were the only evidence of retaliation Serrano had presented; however, since the filing of the lawsuit was just one of several pieces of evidence presented at trial, the time gap alone could not defeat Serrano’s retaliation claim.  The court noted the other evidence presented, including the fact that other doctors had the type of equipment in their offices that the Hospital claimed to have fired Serrano for having; that Serrano had an impeccable work record over more than two decades at the Hospital and, contrary to the Hospital’s standard practice, was fired without having the opportunity to defend himself; and that, before Serrano filed his initial lawsuit, the Hospital’s executive director told Serrano that if he sued the Hospital, he “would no longer be allowed to work either in that hospital or in any other hospital in Puerto Rico.”  There was also testimony from Serrano that relations with the Hospital had grown colder since he filed the lawsuit.  Thus, the appeals court ruled that the evidence presented at trial was enough to support the jury’s finding of retaliation, and it upheld the jury’s verdict.  The case is Muñoz v. Sociedad Española de Auxilio Mutuo y Beneficiencia de P.R., Inc., et. al. (1st Cir. 2012).

Bottom line

This case demonstrates that, even if a lot of time has passed since an employee has complained of discrimination, an employee still can prevail on a retaliation claim.  In order to reduce the odds of that happening to you, be sure that all employment decisions you make are fair, well-documented, consistent, and supported by legitimate, business-based reasons unrelated to an employee’s protected activity.

Article By: Kimberly A. Klimczuk
Reprinted from the August 2012 issue of the Massachusetts Employment Law Letter.

Kimberly A. Klimczuk is a Partner at the firm of Skoler, Abbott & Presser, P.C.  Kimberly can be reached at (413) 737-4753 or kklimczuk@skoler-abbott.com.