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11th Circuit Update: Whistleblower, Fair Labor Standards Act, ERISA

Wiersum v. U.S. Bank, No. 14-12289 (11th Cir. May 5, 2015)

Brief summary: Florida Whistleblower Act Claim Preempted by National Bank Act

In Wiersum v. U.S. Bank, Marc Wiersum, former bank employee/Vice President, appealed the district court’s dismissal with prejudice of his Florida Whistleblower Act (FWA) claim, which it determined was preempted by the National Bank Act (NBA). As background, Wiersum brought a FWA claim after he was terminated for objecting to bank activities he believed constituted “unlawful tying arrangements” and refused to participate in them. In response, U.S. Bank asserted Wiersum’s claims were barred by the NBA, which allows for federally chartered banks to dismiss officers “at pleasure.” The district court concluded the FWA was in direct conflict with the NBA. On an issue of first-impression by the 11th Circuit, the court examined whether the NBA preempts the FWA, noting that the parties agreed the case concerned conflict preemption, but disagreed on resolution. In affirming the district court’s decision in favor of U.S. Bank, the 11th Circuit examined holdings by other Circuit courts, acknowledging that they, too, held in favor of the laws like NBA over state law. In conclusion, the 11th Circuit recognized that the FWA was in direct contradiction to the NBA, and affirmed the district court’s decision.

Mathieu Levy v. Remy Cointreau USA, Inc., No. 14-15467 (11th Cir. May 26, 2015)

Brief summary: Employee’s Primary Duty Irrelevant for Determination of Highly Compensated Employee Exemption Under the Fair Labor Standards Act

In Levy v. Remy Cointreau USA, former employee Mathieu Levy appealed the district court’s summary judgment on his claims of unpaid overtime under the Fair Labor Standards Act (FLSA). In affirming the district court’s decision, the 11thCircuit concluded that there was no genuine issue that Levy was a highly compensated employee, he was exempt from overtime payments. Whether Levy’s primary duty involved exercise of discretion and independent judgment for matters of significant is irrelevant for the highly compensated employee exemption. Decision affirmed.

Cornelius B. Faison v. Donalsonville Hospital Inc., No. 14-14939 (11th Cir. May 26, 2015)

Brief summary: In Faison v. Donalsonville Hospital, the Hospital appealed the district court’s entry of judgment in favor of former employee Cornelius Faison relating to his claims under the Employee Retirement Income Security Act (ERISA) and denial of coverage. By background, the Hospital was the named fiduciary and administrator of an Employee Benefit Plan, which included health insurance coverage, and for which Faison was a plan participant. Faison was injured in a motorcycle accident in July 2009, incurred severe injuries, and was hospitalized for months. His medical bills amounted to nearly $500,000. He was also charged with misdemeanors as a result of the accident, but none of the charges carried imprisonment in excess of one year. The third party administrator of the plan, Paragon, denied Faison’s benefits on the basis that the accident was not covered and basis on the “illegal acts” exclusion. Faison appealed the denial to the Hospital, and the Hospital confirmed the denial on the same basis. However, the plan’s “illegal acts” exclusion defined serious illegal acts of a criminal offense with a sentence to a term of imprisonment in excess of one year. At the district court level, the Hospital challenged Faison’s receipt of a charitable credit, and on appeal, challenged Faison’s alleged failure to provide evidence regarding terms of his receipt of the charitable credit.

In affirming the district court’s judgment in favor of Faison, the 11th Circuit noted that, even in the context of a Rule 60(b)(2) motion for newly discovered evidence, the district court in an ERISA case may only consider the evidence the plan administrator had at the time they made the decision about benefits. The 11th Circuit concluded that the Hospital failed to “carry its burden” to show the district court was required to vacate its order. Decision affirmed.

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* Cathleen Scott is licensed to practice in Florida only.

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