Bluestone v. Randle – Another Case to Watch – Post-Production Costs

Bluestone v. Randle – Another Case to Watch – Post-Production Costs

Originally published by John McFarland.

Last April the Fort Worth Court of Appeals issued its opinion in Bluestone Natural Resources II, LLC v. Randle, No. 02-18-00271-CV, 2019 WL 1716415. The Court decided that, under Randle’s lease, Bluestone could not deduct post-production costs and owed royalty on plant fuel and compressor fuel. Bluestone has petitioned the Supreme Court for review and the Court has asked for briefs on the merits.

Randle’s lease was a printed form with an exhibit. The printed form provided that royalties on gas would be “the market value at the well of one-eighth of the gas so sold or used …” Exhibit A provided that “the language on this Exhibit A supersedes any provisions to the contrary in the printed lease hereof.” One provision in Exhibit A dealt with post-production costs:

Lessee agrees that all royalties accruing under this Lease (including those paid in kind) shall be without deduction, directly or indirectly, for the cost of producing, gathering, storing, separating, treating, dehydrating, compressing, processing, transporting, and otherwise making the oil, gas and other products hereunder ready for sale or use. Lessee agrees to compute and pay royalties on the gross value received, including any reimbursements for severance taxes and production related costs.

The trial court held that Bluestone could not deduct post-production costs, and the Fort Worth Court of Appeals agreed. The Court distinguished Heritage Resources v. NationsBank, 929 S.W.2d 118 (Tex. 1996) and held that the no-deduction clause in the lease’s exhibit modified the royalty clause – in particular, the second sentence of that clause. The second sentence, not present in Heritage, provided an alternate measure of value for royalties – “gross value received” rather than “market value at the well” – and “gross value received” means proceeds prior to deduction of post-production costs. This part of Exhibit A conflicts with the printed royalty clause and so must supersede that clause.

Bluestone argued that the second sentence in the Exhibit A provision did not establish an alternate “valuation point” for the royalty, so the valuation point must still be “at the well” as provided in the printed form. The Court disagreed:

[Bluestone] argues that once an “at the well” measure is baked into the royalty provision, it requires super clarity in any provision that attempts to alter its effect. We construe this argument to mean that once a royalty provides an “at the well” point of valuation, a lease can alter that scheme of valuation only by clearly altering its terms to provide a different point of valuation, such as by striking the words “at the well” when they appear in a lease. …

We do not see how we would be giving Exhibit A its controlling role if we were to cut and past the words “at the well” from Paragraph 3 of the Printed Lease into Paragraph 26 of Exhibit A. In fact, that approach would seem to take exactly the opposite approach mandated by the superseding provision in Exhibit A; we would be resolving the conflict by giving superseding effect to the terms of the Printed Lease. …

In essence, Appellant’s position boils down to the argument that once it appears, the “at the well” measure is so “baked into” the royalty calculation that it has to be physically removed by going to the length of actually striking those words wherever they appear.

The Court noted that the Supreme Court has recognized that  “a proceeds measure–not tied to particular point of sale–creates a measure that does not allow the lessor to net-back its post-production costs,” citing Judice v. Mewbourne Oil Co., 929 S.W.2d 133, 136 (Tex. 1996): Burlington Res. Oil & Gas Co. LP v. Texas Crude Energy, LLC, 2019 WL 983789 at 5; Chesapeake Expl. LLC v. Hyder, 483 S.W.3d 70, 873 (Tex. 2016); and Heritage Res., 939 S.W.2d at 130.

The Court noted that its conclusion may be contrary to that of the El Paso Court of Appeals in Commissioner v. SandRidge, 454 S.W.3d 603 (Ct.App.-El Paso 2014, no pet.), which construed very similar language to allow deduction of post-production costs.

The Court also held that Bluestone had to pay royalty on plant fuel and compressor fuel. Plant fuel was gas produced from the leased premises and burned in the gas plant that processed the lessee’s gas. The compressor fuel was a commingled gas stream that included gas produced from the lease and other leases and was sent to compressors on Plaintiff’s lease and other leases to compress gas produced from the leases. The lease provides that “Lessee shall have free from royalty or other payment the use of … gas … produced from said land in all operations which Lessee may conduct hereunder .. and the royalty … shall be computed after any so used.” The Court held that this provision applied only on gas used on the leased premises. “Hereunder means “under or in accordance with this writing or document.” Plant fuel was not used to operate the lease or produce oil or gas from the lease, but to process gas in the third-party gas plant.

The Court also reasoned that the lease required payment of royalty on “gross value received” from the production; that the lessee received value from the processo in exchange for free use of the gas as fuel; and that Bluestone owed royalties on that value.1

The Court recognized that some of the gas produced from Plaintiff’s lease was used in compressors on the lease and therefor would be covered by the “free from royalty” clause. But the Court held that, because the lessee commingled gas from the lease with other gas, it had a duty to account for the aliquot share of the gas that is burned in compressors on the lease, citing Humble v. West, 508 S.W.2d 812 (Tex. 1974), and had failed to do so, and so was obligated to pay royalty on all production from the lease used as compressor fuel.

Curated by Texas Bar Today. Follow us on Twitter @texasbartoday.


ADA Title III Litigation: A 2019 Review and Hot Trends for 2020

ADA Title III Litigation: A 2019 Review and Hot Trends for 2020

Originally published by Seyfarth Shaw LLP.

By Minh N. Vu

ADA Title III Litigation: A 2019 Review and Hot Trends for 2020 1Seyfarth Synopsis:  ADA Title III lawsuits flooded federal courts in 2019 and will likely continue to do so in 2020 with new theories for the courts to consider. 

We are still tallying up the end-of-year numbers, but the number of ADA Title III lawsuits filed in federal courts by the end of November 2019 (10,206) exceeded the number of such lawsuits filed in all of 2018 (10,163).  California courts continue to be the busiest with roughly 43% of the lawsuits, with New York and Florida courts taking second and third place with  24% and 18% of the market share, respectively.  With plaintiffs and their lawyers constantly conjuring up new claims, businesses are not likely to see any relief from these types of suits in 2020.

What types of lawsuits are trending now?

Braille Gift Card Lawsuits.  Starting in October of 2019, more than a dozen blind plaintiffs represented by five attorneys have filed at least 243 lawsuits in the Southern and Eastern Districts of New York alleging that retailers and other businesses have violated the ADA and New York state and city laws by failing to offer for sale gift cards that have all the information printed on the cards shown in Braille. These cases are assigned to at least twenty-nine different judges. A firm in southern California has also jumped on the bandwagon, filing Braille gift card lawsuits in California state court and sending out a number of pre-suit demand letters. Most defendants are digging in for a fight so we expect to see many motions to dismiss filed in the first quarter of 2020.

Website and Mobile App Accessibility Lawsuits.  Although we are still tallying the numbers, lawsuits alleging inaccessible websites and mobile apps accounted for at least a fifth of the total number of ADA Title III lawsuits filed in federal courts in 2019. Most plaintiffs in these cases are blind and claim that the websites in question do not work with their screen reader software which reads website content aloud. A much smaller number of plaintiffs are deaf and are suing about the lack of closed captioning for online videos.

Plaintiffs continue to file these website and mobile app accessibility lawsuits, though the rate at which they were being filed seemed to slow down in the fourth quarter of 2020. The change may be attributable to the fact that some of the lawyers who were filing many of these website accessibility suits in New York have turned their attention to Braille gift card lawsuits.

The big news from 2019 on the website accessibility front was the U.S. Supreme Court’s refusal to hear Domino’s appeal from a Ninth Circuit Court of Appeals decision allowing a blind plaintiff to pursue his lawsuit against the pizza chain for having an allegedly inaccessible website and mobile app. Businesses had hoped that the Supreme Court would hear the case and perhaps take some action to curtail the tsunami of website and mobile app lawsuits.

In 2019, Plaintiffs also made significant headway in persuading California state courts that inaccessible websites violate the state’s non-discrimination statute, including one appellate affirmation of a judgment in favor of blind plaintiff. In fact, one California Superior Court judge decided that the ADA applies to websites of businesses with no physical location where customers go. In reaching this conclusion, this California judge rejected federal Ninth Circuit precedent that the ADA only applies to websites of public accommodations with a nexus to a physical location.

Hotel Accessibility Information on Reservations Websites.  A number of plaintiffs filed lawsuits against hotels for allegedly failing to provide sufficient information about the accessibility of their accessible guest rooms and common areas on their websites, as required by the ADA Title III regulations, to allow travelers with disabilities to make informed decisions about whether a hotel meets their needs. In response to this flurry of lawsuits, many hotels have updated their websites to provide the required information. Now some plaintiffs are filing lawsuits alleging that hotels are not making accessible rooms available for sale on websites operated by third party online travel agencies.

Accessible Hotel Room Dispersion.  Title III of the ADA requires hotels to provide accessible rooms in a range of different room types (e.g. rooms with two beds, premium views, suites) so that people with disabilities have room choices that are comparable to those offered to people without disabilities. One plaintiff in particular has filed more than a hundred lawsuits under this theory, and we have no reason to think she will stop in 2020.

Inaccessible Facilities.  Historically the most prolific category for accessibility lawsuits, we have continued to see in the lawsuit filing numbers and in our practice many lawsuits about allegedly inaccessible physical public accommodations facilities such as hotels, retail stores, restaurants, and shopping centers in 2019. We do not expect this to change in 2020.


Be sure to subscribe to our ADA blog to receive notices of developments throughout the year!

Edited by Kristina Launey

Curated by Texas Bar Today. Follow us on Twitter @texasbartoday.


Will Dispute Arises Over Definition of “Personal Effects”

Will Dispute Arises Over Definition of “Personal Effects”

Originally published by Tiffany Dowell.


A recent case involving a will devising “personal effects” to a family member is a good reminder of the need to be detailed and complete when drafting a will, and the importance of residuary clauses.

Will Dispute Arises Over Definition of “Personal Effects” 2

Photo by sydney Rae on Unsplash


In 1990, Mildred Ethridge drafted a will that included the following provisions:

I, MILDRED L. ETHRIDGE, (femme sole) of Midland County, Texas, for the purpose of the distribution of my entire estate, real, personal and mixed, which I wish to have take effect at my death, do make, publish and declare this to be my Last Will and Testament, and I do hereby revoke all former wills and testamentaries heretofore made by me at any time.

I hereby appoint and name Fred D. Davis, Jr. as Independent Executor and trustee of my estate, to serve without bond.  I give Fred D. Davis, Jr. all my personal effects to clear my estate after my death.

I give and bequeath my 1/2 ownership in my residence and homestead…to Patricia Petosky. 

Mildred passed away in 1994.  Prior to her death, she gifted her 1/2 ownership interest in the homestead to someone else, leaving Davis as the only named party under the will. Davis was named executor of her estate. 

At her death, Mildred had money in checking accounts and miscellaneous property including furniture and a television. She also had mineral interests that were not specifically devised in her will or included in the inventory submitted to probate.  The mineral lessee began paying royalties to Mildred’s estate and Davis opened a checking account to receive these royalties.  Believing he was entitled to her entire estate, he transferred the royalty payments from the estate’s checking account into his personal account.


In 2010, Mildred’s heirs discovered they may have been entitled to royalties under her estate. They argued that the mineral interests did not pass under her will. At trial, the court had to construe the meaning of the term “personal effects.”  The court held that this term as more limited than “personal property” and rule that it included only the furniture and television owned by Mildred, but did not include her bank accounts, receivables, and interest in oil, gas, other minerals, royalties, real property, or other personal property.  As to these assets, the court held she died intestate and the intestate succession laws should govern distribution.

Davis appealed the court’s decision regarding the definition of “personal effects.”  The Eastland Court of Appeals affirmed the trial court’s ruling. [Read full opinion here.]

The court noted that, when interpreting a will, a court seeks to ascertain the intent of the testator based on the language included in the will itself.  Terms used in a will are to be given their “plain, ordinary, and generally accepted meaning” unless the will shows they were used in a technical or different sense.

First, Davis argued that the initial clause in her will stated that her intent was to dispose of her entire estate, real, personal, and mixed.  It was her intent, Davis argued, to divide her property into two categories–the 1/2 interest in the Oxford House, and then everything else, which she referred to as “personal effects.”  Davis argues the court should broadly interpret the phrase “personal effects” because Mildred was not an attorney and her will was not drafted by an attorney.

The court rejected this argument. Under the law, the term “personal effects” generally refers “to articles bearing intimate relation or association to the person of the testator” such as clothing, jewelry, toiletries, glasses, dentures, and luggage. Mineral interests do not fall within the scope of “personal effects.”  Further, Mildred indicated she intended to dispose of her entire estate, real, personal and mixed.  By stating she left only her “personal effects” to Davis, it appears she did not intend for that to include her real property as well.

In light of this, Mildred’s will did not dispose of her entire estate.  When a person drafts a will, there is a presumption that he or she intends to dispose of the entire estate.  That presumption is strong, noted the court, but can be overcome in situations where the testator fails to provide for complete distribution of property.  In that situation, the testator is found to have died intestate as to the property not included in the will.  In this scenario, the court upheld the finding that Mildred died intestate as to her mineral and royalty interests and her bank accounts.

Thus, the court affirmed.  Davis was entitled only to the furniture and television, while the bank accounts, mineral interest, and royalty interests passed through intestacy.

Key Takeaways

First, I think the most important reminder from this case is the need for including a residuary clause in a will. Even the most carefully drafted will may omit certain assets.  Whether that be something the testator simply forgot, something purchased after a will was drafted, or something that the testator thought was covered by the will that simply was not, this can certainly happen.  One way to avoid the issue here, where a portion of the estate passed outside the will via intestate succession, is to ensure that a will has a residuary clause.  This clause simply disposes of any estate assets that remain after all of the other devises in the will have been made. In this case, for example, had there been a residuary clause, the bank accounts, mineral rights, and royalty rights would have passed to the person named in the residuary clause.  A sample residuary clause could be: “I give the rest, residue, and remainder of my estate to my husband.”

Second, when writing a will, it is important for the testator to do his or her best to think of all assets owned.  I always recommend that before delving into will drafting or other estate planning, parties gather information on their assets, agricultural business, farm and ranch.  This includes an inventory list that identifies all major assets including real property, vehicles, equipment, mineral rights, royalty interests, bank accounts, retirement savings, investment portfolios, and personal property of significant value such as jewelry, artwork, and firearms. Having a complete inventory list can help to ensure one’s will does bequeath all of one’s assets.

Third, it is important to continue to update a will after it is drafted.  This is particularly important if major life changes occur such as births, deaths, divorces, or the sale or purchase of assets.  It is good practice to do a quick review of one’s will each year to ensure that changes do not need to be made.

Fourth, I always recommend that people at least consider using an attorney to draft a will.  There are certainly documents that I think people can adequately draft themselves without too much worry.  Wills, however, are so important and their interpretation is so critical that using an attorney to ensure that the testator’s wishes are carried out is generally well worth the cost.  Additionally, while there is an up-front cost to have a will drafted by an attorney, it will almost always be less than the cost of litigating a will dispute down the road.

Finally, for anyone serving as an executor of an estate, it is really important to ensure that the executor understands what assets exist and how they are to pass under the will.  Here, it was the executor’s belief that mineral and royalty rights were included in the term “personal effects” that caused the issue leading to litigation. Executors should be extremely careful and prudent before deeding over any assets from an estate.





The post Will Dispute Arises Over Definition of “Personal Effects” appeared first on Texas Agriculture Law.

Curated by Texas Bar Today. Follow us on Twitter @texasbartoday.


Decisions, decisions: Somali men convicted of terrorism enter fourth year waiting for appeals court ruling [The San Diego Union-Tribune]

Minor-league players win another ruling in federal minimum-wage lawsuit [San Francisco Chronicle]

Jan. 4–A landmark lawsuit aimed at getting Major League Baseball and 22 of its 30 teams to pay back wages to thousands of current and former minor-league players inched closer to trial Friday with a federal appellate court in San Francisco ruling in the players’ favor. The Ninth Circuit denied a request from the defendants […]


Decisions, decisions: Somali men convicted of terrorism enter fourth year waiting for appeals court ruling [The San Diego Union-Tribune]

Appeals court revives lawsuits against Michael Jackson companies [Los Angeles Times]

Two lawsuits brought by Michael Jackson’s most vocal accusers were revived on Friday after being dismissed in 2017. The Second Appellate District in the California Court of Appeals issued the decision on Friday after a state law went into effect extending the statute of limitations on child sexual-abuse cases. The decision reinstated previous legal actions […]


Appellate court orders new sentence in 2015 Vallejo shooting

Appellate court orders new sentence in 2015 Vallejo shooting

Appellate court orders new sentence in 2015 Vallejo shooting 3FAIRFIELD — A Vallejo man who is serving 30 years to life in state prison won a victory in the state Court of Appeals and will be re-sentenced. Mark S. Crosby was sentenced to five years for shooting from a motor vehicle at a person, and had an additional term of 25 years to life […]


2019 Labor & Employment  Predictions Reviewed

2019 Labor & Employment Predictions Reviewed

Originally published by Brett Holubeck.

Image stating "Happy New Year" to demonstrate the review of the 2019 labor and employment predictions.
Photo by Kelly Sikkema on Unsplash

If you recall this article from last year article from last year, then you remember that I made some labor and employment predictions for 2019. Some of them came true, but some of them were delayed, likely until 2020. Here is an overview of each of the labor and employment predictions and where the law or issue stands right now.

1. Sexual Harassment Lawsuits Increased

In 2018, the last fiscal year that data is available for
sexual harassment lawsuits, the data from the EEOC showed that these lawsuits

 The agency also received 7,609 sexual harassment charges – a 13.6 percent increase from FY 2017 – and obtained $56.6 million in monetary benefits for victims of sexual harassment.

The final figures for 2019 are not available yet. However, increasing sexual harassment litigation and charges at the EEOC is a trend that will likely continue. Sexual harassment is not being tolerated in the workplace. Moreover, companies are holding their executives, managers and others to a higher standard than they used to. For example, the CEO of McDonalds stepped down last year for having a consensual  relationship with an employee. Again, that is a consensual relationship without any sexual harassment. Many companies prohibit their C-suite from dating anyone at the company. Every company needs to consider how they can prevent sexual harassment. Training for employees, training for managers, and having an appropriate complaint procedure is absolutely necessary, or it will most certainly cost you in the long run. You can read more of how companies can prevent sexual harassment here and in this recent Chicago Tribune article where I discussed office romance in the workplace.

2. The Supreme Court Has Taken Cases to Determine Whether Sexual Orientation is Protected.

The Supreme Court has consolidated 2 cases (Bostock v. Clayton County, Georgia and Altitude Express Inc. v. Zarda) to determine whether discrimination against an employee due to their sexual orientation is prohibited employment discrimination “because of sex” under Title VII. The Supreme Court also took a case (R.G. & G.R. Harris Funeral Homes Inc. v. Equal Employment Opportunity Commission) to determine “[w]hether Title VII prohibits discrimination against transgender people based on (1) their status as transgender or (2) sex stereotyping under Price Waterhouse v. Hopkins.

Essentially, the first
cases will determine if sexual orientation is a protected characteristic under
the law (whether it is illegal to discriminate against someone because of their
sexual orientation). The second case will determine whether it is illegal to
discriminate against someone because they are transgender.

The arguments were in early October; most people expect this to be one of the final decisions that the court issues in June. It is anyone’s guess how these cases will be decided. Most people expect that these cases will be highly divided.

3. The Department of Labor is Increasing the Salary Threshold (but I’m Off by 1 Day).

The Department of Labor did increase the salary threshold to be exempt from overtime (employees must still meet the duties test of one of the exemptions), but I missed my prediction by 1 day (it went into effect on January 1, 2020).

I wrote about this a couple of weeks ago. Here is what the DOL did:

The new overtime salary threshold will be $684 per week (which equals $35,568 per year). The new rule also raises the threshold for the highly compensated category from the current threshold of $100,000 to $107,432 per year. The new rule will also permit employers to use nondiscretionary bonuses and commissions that are paid on at least an annual basis within this count towards meeting the overtime salary threshold (but only up to 10%) of the salary level.

4. Paid Family Leave is Still Coming. It was not Implemented Nationally Last Year, but There Have Been Some States that Have Expanded Paid Leave.

Currently only D.C. and 8 states have passed Paid family leave laws. While no paid family leave proposals were enacted last year at the federal level, several states (and the federal government for its employees) have begun implementing paid family leave or increased paid sick leave.

  • The House of Representatives has approved a bill to give 12 weeks of paid parental leave to federal workers and President Trump has shown support for the bill.
  • The state of Washington passed SB 5975 in July 2017 to commence a paid leave program at the start of 2020.
  • Connecticut passed legislation in 2019 that establishes a paid family leave program. Employers must begin withholding and remitting contributions by January 1, 2021, and employees can begin using the leave on January 1, 2022.
  • Oregon also passed a law that will take effect in 2023 and will provide 12 weeks of paid time off for parental leave, leave for domestic violence issues, and if the person is ill or caring for a family member that is ill.
  • Nevada passed a paid leave law that went into effect on January 1 and will apply to employers with 50 or more employees. These employees will generally get 40 hours of leave per year.
  • Washington D.C. residents will be eligible for paid leave beginning on July 1, 2020. Employees will be able to use “8 weeks to bond with a new child, 6 weeks to care for a family member that has a serious health condition, and 2 weeks to care for their own serious health condition.”
  • Maine passed a law that will go into effect in January 2021 that will require employers with 10 or more employees to provide up to 40 hours of paid leave every year. It is the first state to allow the leave to be used for any reason rather than merely sick leave.
  • California passed SB 83 which increased paid family leave from 6 weeks to 8 weeks beginning on July 1, 2020 and increases the wage replacement rate.

With this year being an election year, one should expect that more states will begin to pass paid family leave.

5. NLRB Joint Employer Standard Will be Issued Soon

Again, this one was close. Originally, the National Labor Relations Board (NLRB) was set to issue the final rule in December 2019, but it has not yet issued the final rule. It has, however, ruled that McDonald’s should not be held responsible for any labor violations of the franchisers (i.e. it is not a joint employer). The final rule was not published in 2019, so employers should expect that it will be published sometime this year.

Moreover, both the Equal Employment Opportunity Commission (EEOC) and the Department of Labor (DOL) are set to issue joint employer rules of their own in 2020.

6. Independent Contractor Issues Did Arise in Many States

This prediction is a big yes. 2019 may be remembered as a
tipping point for issues related to independent contractors. However, it is not
due to the actions of the federal government.

The change occurred because of state regulations and new legislation. The biggest impact on independent contractors last year came out of California and New Jersey (which may spread to other states in 2020). California passed AB 5 in September of last year and the legislation took effect on January 1, 2020. To be an independent contractor all 3 of the following elements must now be met:

(A) The hiring entity does not control or direct the worker in performing the work in fact or under the terms of a contract;

(B) The work performed is outside the “usual course” of the hiring entity’s business; [and]

(C) The worker is customarily engaged in an independently established trade, occupation, or business of the same nature as that involved in the work performed.

It is very difficult for
many workers to meet the second prong (outside the usual course of a company’s
business). This prong (and specifics in the bill) is why the new test has come
under a lot of controversy from
independent truckers
  and freelance writers (who are now limited to 35 articles per publication before the company must
hire them as employees, and as a result being hurt by this new law). These individuals are losing their
flexibility due to the law as they can no longer be independent contractors.

Of course, the law will have an impact on the major companies in the gig economy (Uber, Lyft, DoorDash, etc.), but many of these companies do not plan on transitioning their independent contractors to employees right away as they plan to argue that these workers are not a part of their core business. For example, Uber will argue that they are a technology platform for several different digital marketplaces (Uber, Uber Eats, etc.) that match providers (drivers) and customers (riders) and their drivers are thus independent contractors.

New Jersey was also a major player in changing the landscape of independent contractors this past year. The New Jersey Department of Labor and Workforce Development issued a $649 million fine to Uber for unpaid unemployment and disability insurance taxes, which Uber is challenging. Essentially, the ruling was for Uber failing to pay taxes for these workers because they were misclassified as independent contractors rather than employees.

7. Medical Marijuana Protections Update

Marijuana laws have continued to change all across the
country. The Health Employment and Labor blog from Epstein Becker Green
does a nice job explaining the past year of marijuana changes.

Illinois became the 11th state to legalize the use of recreational marijuana and the law took effect on January 1, 2020. Under the law, employers in Illinois may still take action against employees or applicants that fail a drug test provided that it is in the employer’s reasonable policy.

Epstein Becker Green’s blog also notes that:

New Mexico and Oklahoma each passed legislation that prohibits employers from discriminating against employees because of their status as registered medical marijuana users; however, the Oklahoma law does provide an exception for safety-sensitive jobs and for situations which the employee possesses, consumes or is under the influence of marijuana at work.

In Nevada, a new law taking effect on January 1, 2020, prevents employers from failing or refusing to hire an applicant because the applicant tests positive for marijuana. Perhaps not surprisingly, New York City went one step further when it passed an Int. 1445-A, barring most employers from conducting any pre-employment testing for marijuana or THC.

Similarly, New Jersey now prohibits employers from disciplining or terminating an employee solely based on that individual’s status as a registered medical marijuana user.  While the law does not prevent employers from prohibiting or disciplining employees from using marijuana during work hours or on workplace premises, Garden State employers with a drug testing policy are required to offer employees and applicants who test positive the opportunity to explain the positive result.

Companies should expect more changes in marijuana law in 2020.

8. ICE and Notice of Inspection Statistics

We are still waiting to see the exact numbers for 2019, however,  Miriam Jordan’s New York Times article, More Than 2,000 Migrants Were Targeted in Raids. 35 Were Arrested, confirms that 3,282 Notices of Inspection were issued as of July 22, 2019. The article also provides key statistics from Immigration and Customs Enforcement. It appears that notices of inspection are at least on pace to be at an increased level from the Obama administration.

9. DACA’s Constitutionality to be Determined in 2020

The Supreme Court has consolidated three cases that concern DACA (Department of Homeland Security v. Regents of the University of California, Trump v. NAACP, McAleenan v. Vidal)

As I said in a prior post:

These cases basically deal with whether the Department of Homeland has the authority to end the program which 700,000 people rely on. Trump has expressed support for DACA, but wants Congress to act on a more permanent solution (likely as part of a wider deal on immigration).

I thought that the Supreme Court would have accepted the case a bit earlier than they did (in first half of 2019), but the case was ultimately not on the 2018-2019 docket. It is instead on the 2019-2020 docket, so we will get an answer on the constitutionality of the DACA program this year. Everyone expects this to be one of the most contentious cases this term with a decision in late June 2020.

10. Work Authorization for the spouses of H-1B Visa Holders with an Approved I-140 (Essentially their Employer Sponsored Green Card Petition) Will Likely be Determined in 2020.

I thought that the government would have reached a decision
on the Employment Authorization Documents for spouses of H-1B visa holders with
an approved I-140 (there are some immigrants that are waiting 10 or more years
from the approval of their employer sponsored petition for them to become green
card holders to them finally becoming permanent residents) in 2019.
Fortunately, there has been a delay, which is great for H-1B visa holders as
their spouses can continue to renew their work authorization until a decision
is issued.

Big Law Business from Bloomberg law explains the
current state of the law:

The fate of H-4 employment authorization hangs in the balance as 2019 [came] to a close. It’s been nearly a year since the Department of Homeland Security sent the Office of Management and Budget a proposed rule that would rescind a 2015 regulation extending certain H-4 visa holders—the spouses of H-1B professional workers—the opportunity to seek U.S. employment.

The DHS has offered little explanation as to why the rule remains unpublished, but recently affirmed its commitment to proceed with rescission as early as spring 2020, albeit referring to that timeframe as “aspirational.”

In the meantime, H-4 employment authorization faces a second, more pressing threat. On Nov. 8, in Save Jobs USA v. DHSthe U.S. Court of Appeals for the District of Columbia Circuit held that a group of American IT workers has standing to challenge the H-4 regulation.

The court remanded the case to the district court to address the merits of Save Jobs’ claim—that the DHS lacks authority to extend employment authorization to H-4 spouses absent explicit congressional direction.

Essentially, there is now a court case that will be decided over the next year or two (through a decision and appeals) and a regulation that may be released in 2020 (however, that is what the agency said in 2019 so we will see if that holds true) that will provide clarity on the issue. Of course, if a Democratic candidate is elected in 2020, then these individuals will likely keep their work authorization (or will regain it in 2021).


2019 was a huge year for labor and employment law. 2020 will be another big year as the current administration tries to put out more regulations and decisions before the 2020 presidential election. I will follow along with these pending cases this year, and address them here as decisions are made. I also be making some more labor and employment predictions for 2020, so stay tuned.

Wishing everyone a happy and healthy 2020- and for those of you who have already broken your resolution (did you already eat that piece of pie you swore off of? I know I did.), remember every single day is a day for progress. Cheers to that!

The information provided in this blog is for educational purposes only and is not legal advice. If you need legal advice, then you should speak with a lawyer about your specific issues. Every legal issue is unique. A lawyer can help you with your situation. Reading the blog, contacting me through the site, emailing me or commenting on a post does not create an attorney-client relationship between any reader and me.

The information provided is my own and does not reflect the opinion of my firm or anyone else.

The post 2019 Labor & Employment Predictions Reviewed appeared first on Texas Labor Law Blog.

Curated by Texas Bar Today. Follow us on Twitter @texasbartoday.


Pay Equity Litigation Update: The Second Circuit Clarifies A Key Difference Between Title VII And Equal Pay Act Wage Discrimination Claims

Pay Equity Litigation Update: The Second Circuit Clarifies A Key Difference Between Title VII And Equal Pay Act Wage Discrimination Claims

Originally published by Seyfarth Shaw LLP.

By Matthew Gagnon

Pay Equity Litigation Update: The Second Circuit Clarifies A Key Difference Between Title VII And Equal Pay Act Wage Discrimination Claims 4Seyfarth Synopsis: In an unusual opinion considering an issue raised by the plaintiff for the first time on appeal, the Second Circuit clarifies that unlike under the Equal Pay Act, Title VII plaintiffs need not show “equal work for unequal pay” to succeed on a pay discrimination claim. This case demonstrates that plaintiffs have options when bringing such claims and underscores the different challenges employers face under the different statutory schemes.

On December 6, 2019, the Second Circuit Court of Appeals vacated in part a summary judgment ruling that had dismissed a plaintiff’s pay equity claims against her former employer. The plaintiff had alleged, in relevant part, violations of the Equal Pay Act (“EPA”) and Title VII related to the setting of her compensation. The District Court for the Eastern District of New York dismissed her claims because she had failed to prove she performed equal work for unequal pay, as she was the only employee in her position at the company. After consideration, the Second Circuit vacated the District Court’s order related to the Title VII claim, clarified the standard for Title VII discriminatory compensation claims, and remanded the case back to the District Court for further proceedings.

Case Background

Plaintiff filed her lawsuit in 2014 alleging violations of the EPA, Title VII, the Pregnancy Discrimination Act, the whistleblower protections of the Consumer Product Safety Improvement Act, and related provisions of New York state law. In sum, Plaintiff’s complaint claimed that Defendant had paid her less because of her gender, retaliated against her when she brought forward concerns about her disparate pay and potential Consumer Product Safety Act violations, and terminated her because she was pregnant. Defendant filed a motion for summary judgment on Plaintiff’s claims in March 2017.

In March 2018, the District Court granted the motion for summary judgment. After analyzing Plaintiff’s pay discrimination allegations, the District Court held that Plaintiff’s Title VII claims, like claims brought under the EPA, required her to show “positions held by her purported male comparators [were] substantially equal to her position.” Lenzi v. Systemax, Inc., No. 18-979, 2019 WL 6646630, at *6 (2d Cir. Dec. 6, 2019) (internal citations omitted). Plaintiff could not make this showing because she was the only employee who held her job title and duties, so her Title VII claims were dismissed. The District Court further noted that Plaintiff had not presented evidence of discriminatory intent in the determination of her pay, as is also required for Title VII wage disparity claims.

Plaintiff subsequently appealed the District Court’s order to the Second Circuit. Notably, in the briefing of the summary judgment motion to the District Court, both Plaintiff and Defendant had agreed that Title VII disparate pay claims shared the same standard as EPA claims but required an additional showing of discriminatory animus; however, on appeal, Plaintiff challenged the District Court’s holding that Title VII discriminatory compensation claims, like EPA claims, required a showing of equal work for unequal pay.

The Court’s Decision

In evaluating the dismissal of Plaintiff’s Title VII claims, the Second Circuit first addressed Plaintiff’s failure to challenge Defendant’s argument at the summary judgment stage that a pay discrimination claim under Title VII required a showing that the Plaintiff’s position was substantially equal to the positions held by her purported comparators (in fact, the Plaintiff adopted this standard in her own briefing on the issue). While the Second Circuit recognized that “[s]uch a concession ordinarily precludes a party from advancing a different argument on appeal,” it ultimately decided that it would exercise its discretion to consider the Plaintiff’s later argument that such standard was not appropriate. Id.

The Second Circuit then acknowledged that one of its opinions from 1995, which held that“[a] claim of unequal pay for equal work under Title VII . . . is generally analyzed under the same standards used in an EPA claim,” is commonly used by district courts in their analyses of Title VII pay discrimination claims. Id. (quoting Tomka v. Seiler Corp., 66 F.3d 1295, 1312 (2d Cir. 1995)). The Court expressed a desire to “take this opportunity to clarify that a Title VII plaintiff alleging a discriminatory compensation practice need not establish that she performed equal work for unequal pay,” as is required by the EPA. Id. at *7 (emphasis added). While affirming that a plaintiff could bring a claim for equal work for unequal pay under Title VII if they could show a discriminatory animus behind the pay determination, the Court emphasized that such a claim was not the only kind of Title VII claim available related to pay.

The Second Circuit gave examples of several variants of disparate pay claims that could be alleged under Title VII that would not require an equal work for unequal pay showing: “[f]or example, an employer might hire a woman for a unique position in the company, but then pay her less than it would had she been male . . . [s]imilarly, if an employer used a transparently sex-biased system for wage determination, women holding jobs not equal to those held by men would be denied the right to prove that the system is a pretext for discrimination [if required to make such a showing].” Id. Ultimately, the Second Circuit rejected the notion that plaintiffs can only succeed on discriminatory pay claims under Title VII if there is an employee of the opposite sex in an equal position earning a higher rate of pay.

The Court concluded its holding by reiterating that “all Title VII requires a plaintiff to prove is that her employer ‘discriminate[d] against [her] with respect to [her] compensation . . . because of [her] . . . sex.” Id. (quoting 42 U.S.C. § 2000e-2(a)(1)). Discriminatory pay claims can be brought successfully under Title VII even if the plaintiff cannot show a purported comparator of the opposite sex earning a higher wage (provided that the challenged pay rate is not based on seniority, merit, quantity or quality of production, or any other factor besides sex). The Second Circuit then found that the Plaintiff had sufficiently shown discriminatory intent with respect to her pay and vacated the District Court’s order granting summary judgment on her Title VII claim.

Implications For Employers

The Second Circuit’s opinion is, in effect, a reaffirmation of the U.S. Supreme Court’s 1981 holding in Washington County v. Gunther. 452 U.S. 161 (1981) (“[C]laims for sex-based wage discrimination can also be brought under Title VII even though no member of the opposite sex holds an equal but higher paying job.”). However, this case serves as a good reminder that employers should not expect to rely exclusively on the fact that there is no comparator in an equal position as a defense to a pay discrimination claim. Plaintiffs in such positions have options as to how to structure their theory of the case. And the oft-repeated mantra that Title VII is to be interpreted in line with the EPA clouds important, substantive differences between those two statutory schemes. When performing pay equity audits or setting employee compensation, employers should be mindful of those differences, particularly employers with more specialized positions or smaller operations that may have only one or two employees in senior leadership roles or performing the same kind of work. Such employers may also want to check market analyses and reporting when setting compensation. This case shows how pay equity claims can be brought even where there are no purported comparators, perhaps especially when it comes to high-level or specialized positions that are unique within a company.

Please feel free to reach out with any questions to the author, your Seyfarth attorney, members of Seyfarth’s Pay Equity Group, or the Group’s co-chairs Christine Hendrickson and Annette Tyman.

Curated by Texas Bar Today. Follow us on Twitter @texasbartoday.


Court Holds That Will Contestant Was Not Estopped From Challenging The Will Due To Accepting Assets

Originally published by David Fowler Johnson.

In In the Estate of Johnson, a decedent’s daughter filed a will contest after accepting over $146,000 from the estate. No. 05-18-01193-CV, 2019 Tex. App. LEXIS 9646 (Tex. App.—Dallas November 4, 2019, no pet.). The executrix filed a motion in limine challenging the daughter’s standing and asked the trial court to dismiss the will contest, which the trial court did. The daughter appealed.

The court of appeals first addressed whether the daughter had standing to file a will contest. The court held that “[d]evisees and heirs-at-law are interested persons.” Id. (citing Tex. Est. Code § 20.018). The court concluded:

Though Lisa Jo claims that Tia did not meet this burden because she failed to introduce the Will into evidence with her petition, we assume the trial court took judicial notice of the Will and its contents, as well as the inventory, which was in the trial court’s files. Because the face of the Will established Tia’s standing as a devisee and an heir-at-law, Tia satisfied her threshold burden.

Id. The court then reviewed the estoppel defense arising from the daughter’s acceptance of estate assets. The court reviewed the law and its own precedent on estoppel in this context:

Estoppel by acceptance of benefits provides a will proponent one mechanism for challenging a will contestant’s standing. The rule of estoppel by acceptance in will contests is designed to estop a will contest by a person who previously accepted a benefit devised under the will. If the proponent seeks to challenge the contestant’s standing by way of estoppel by acceptance, he or she must assert it as an affirmative defense. Accordingly, the will proponent bears the burden of proving the affirmative defense by demonstrating that the challenge is inconsistent with the accepted benefit. To do so, this Court has held that the proponent must demonstrate that the contestant “received benefits to which she would not be entitled under [any] will, or even under the laws of intestacy.” In Holcomb, this Court held the proponent had not met this burden because he “failed to establish as a matter of law that [the contestant] accepted benefits under the probated will over those which she would have otherwise been entitled to.” Therefore, the contestant was not estopped from filing a contest because she had not received more benefits than she was entitled to under the will or intestacy.

Id. The court concluded that the executrix failed to meet her burden to establish estoppel:

Though Tia accepted the bequest, the Will and inventory also demonstrated that she was entitled to half of a bank account and additional residual gifts devised by the Will, a fact conceded by Lisa Jo. Additionally, Tia’s acceptance was also consistent with the laws of intestacy because, as an heir, she would have been entitled to a one-third share of the $1,427,209 estate. Rather than satisfy her burden, Lisa Jo relied on a case that disagreed with our holding in Holcomb, and argued Tia was burdened with disproving estoppel. Declining an unacceptable invitation for one panel of this court to disregard the holding of another panel, we hold Lisa Jo failed to satisfy her burden, as the Will’s proponent, by failing to demonstrate that Tia accepted greater benefits than those to which she was entitled under the Will or intestacy laws.


Interesting Note: The court of appeals refused to review the propriety of its previous opinion in Holcomb v. Holcomb, 803 S.W.2d 411, 414 (Tex. App.—Dallas 1991, writ denied). Another court has criticized Holcomb as contrary to binding Texas Supreme Court authority. See In re Estate of McDaniel, 935 S.W.2d 827, 829 (Tex. App.—Texarkana 1996, writ denied). The court in Estate of McDaniel stated:

McDaniel argues that estoppel by acceptance of benefits should not apply in this case because the property he received under the 1994 will is but a small part of what he allegedly would have received under the 1989 will he wishes to have probated. McDaniel relies almost exclusively on Holcomb v. Holcomb [citation omitted]. Holcomb holds that a person who has received benefits under a will is not estopped to contest that will if the person would have received the same or a greater amount of benefit under another will of the testator or under the law of intestacy. [Citation omitted.] This holding is an inaccurate statement of Texas Supreme Court precedent on this issue. The proper test for determining whether a beneficiary under a will has received benefits which estop him from contesting that will is whether the benefits granted him by the will are or are not something of which he could legally be deprived without his consent. [Citation omitted.]

935 S.W.2d at 829. Therefore, there is some controversy regarding the merits of the Holcomb court’s opinion and holding on estoppel.

The court in In the Estate of Johnson refused to reevaluate its twenty-eight year old precedent. Rather, the court held that one panel of the court should not disregard the holding of another panel. This is an important use of stare decisis. As courts have held: “Absent (1) a decision from a higher court or this court sitting en banc that is on point and contrary to the prior panel decision or (2) an intervening and material change in the statutory law, this court is bound by the prior holding of another panel of this court.” Clear Lake City Water Auth. v. Friendswood Dev. Co., No. 14-07-00404-CV, 2008 Tex. App. LEXIS 9127, 2008 WL 5131932, at *1 (Tex. App.—Houston [14th Dist.] 2008, pet. denied); D’Arcy v. Mead, No. 14-04-01220-CV, 2006 Tex. App. LEXIS 6850, 2006 WL 2165733, at *3 (Tex. App.—Houston [14th Dist.] Aug. 1, 2006, pet. denied); City of Webster v. City of Houston, No. 14-04-00353-CV, 2005 Tex. App. LEXIS 3048, 2005 WL 913813, at *1 (Tex. App.—Houston [14th Dist.] Apr. 19, 2005, no pet.); United States v. Treft, 447 F.3d 421, 425 (5th Cir. 2006). Moreover, if, in its holding, the prior panel applied or distinguished the higher-court or en banc precedent, then subsequent panels are still bound by the first panel decision, even if they think that the first panel misapplied and contradicted the superior precedent. County of Monroe, Florida v. U.S. Dep’t of Labor, 690 F.2d 1359, 1363 (11th Cir. 1982); Wilson v. Taylor, 658 F.2d 1021, 1034-35 (5th Cir. 1981).

So, the panel of the court of appeals in In the Estate of Johnson correctly refused to revisit another panel’s decision absent a decision from a higher court or an en banc court or some other intervening and material change in the law. This is a very important concept in Texas at this time. This past election cycle, many of the courts of appeals in Texas went from republican majorities to democratic majorities. No matter the political affiliation, courts of appeals should follow stare decisis and follow the court’s earlier precedent even if the current justices do not agree with that precedent. This is an important aspect of the rule of law.

Curated by Texas Bar Today. Follow us on Twitter @texasbartoday.


Appellate court upholds Vacaville murder conviction

Appellate court upholds Vacaville murder conviction

Appellate court upholds Vacaville murder conviction 5FAIRFIELD — Alijondro Jones claimed his conviction of first-degree murder should be reversed because it was based on “uncorroborated accomplice testimony.” The 1st Appellate District of the state Court of Appeals did not agree, upholding the conviction in a ruling dated Dec. 26. Jones was sentenced to 25 years to life in prison on May […]