Court of Appeals March Session: Arguments of Interest for March 28, 2017

The Court of Appeals’ March Session continues on Wednesday, March 28, 2017 with three cases on the argument docket (the Court’s case summaries can be found here).  The Court will hear argument today on the following issues: (1) whether the prosecutor should be given the right to rebut an agency defense raised by the criminal defendant based upon only the prosecution’s own proof, and without the defendant introducing any evidence of his own; (2) whether a company that is not an employee’s employer may be held liable for discrimination under the Human Rights Law; and (3) whether a prevailing plaintiff may sue a responsible insurer to recover the balance of an unpaid judgment where the insurance policy was not “issued and delivered” in New York.

No. 35    Griffin v Sirva, Inc.

In this discrimination action, two movers employed by Astro Moving and Storage Co. sued the parent company of Allied Van Lines, Sirva, Inc., for employment discrimination under the New York State Human Rights Law, which prohibits the denial of employment opportunities based upon a prior criminal conviction. About 70 to 80 percent of Astro’s business was through a contract with Sirva, and the contract required that Astro ensure that none of its employees were ex-felons. The plaintiffs went through a criminal background check performed by an Allied contractor, which revealed that they had prior felony convictions for violent sexual offenses.  The Allied contractor advised Allied, Allied advised Astro, and the plaintiffs were terminated.

The United States District Court for the Eastern District of New York granted Allied’s and Sirva’s motions to dismiss, holding that the New York Human Rights Law does not recognize discrimination claims against parties that are not the employees’ direct employer.

The United States Court of Appeals for the Second Circuit, however, recognizing that the law is not so clear, certified the question to the Court of Appeals. Specifically, the Second Circuit asked the Court of Appeals to decide: “(1) Does Section 296(15) … limit liability to an aggrieved party’s ‘employer’? (2) If Section 296(15) is limited to an aggrieved party’s ‘employer,’ what is the scope of the term ‘employer’ for these purposes, i.e., does it include an employer who is not the aggrieved party’s ‘direct employer,’ but who, through an agency relationship or other means, exercises a significant level of control over the discrimination policies and practices of the aggrieved party’s ‘direct employer’? (3) Does Section 296(6) …, providing for aiding and abetting liability, apply to § 296(15) such that an out-of-state principal corporation that requires its New York State agent to discriminate in employment on the basis of a criminal conviction may be held liable for the employer’s violation of § 296(15)?”

This will be an interesting case to watch. If the Court of Appeals holds that the Human Rights Law recognizes claims against parties other than a direct employer, the number of cases brought under the Human Rights Law and any attendant liability could be expanded significantly.  A decision should be made during the April-May Session of the Court.

The Second Circuit’s opinion can be found here.

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