Wednesday, April 09, 2014

debt collection - notice of validation rights - FDCPA

Harlan v.  TransWorld Systems, dba North Shore Agency – ED Pa.  – April 8, 2014

Following Caprio v. Healthcare Revenue Recovery Group, 709 F.3d 142 (3d Cir. 2013) Debt collector failed to give a proper notice of validation rights and violated sec. 1692g, where the notice appeared buried in a lot of other notices on the reverse side of a letter, and where a conflicting notice of "STATEMENT OF INTENTIONS" appeared on the front. 



Thursday, April 03, 2014

UC - willful misconduct - absenteeism - final absence - good cause

Howard Hanna Holdings, Inc. v. UCBR – Cmwlth. Court – April 3, 2014 – unreported memorandum opinion

An employer has the right to expect that its employees will attend work when they are scheduled, that they will be on time, and that they will not leave work early without permission. Fritz v. Unemployment Compensation Board of Review, 446 A.2d 330, 333 (Pa. Cmwlth. 1980). As a result, excessive absenteeism and tardiness may constitute willful misconduct as a disregard of the standards that an employer has a right to expect of its employees. Id.; American Process Lettering, Inc. v. Unemployment Compensation Board of Review, 412 A.2d 1123, 1125 (Pa. Cmwlth. 1980); Crilly v. Unemployment Compensation Board of Review, 397 A.2d 40, 41 (Pa. Cmwlth. 1979).

Although an advance warning is not a precondition or prerequisite to support a discharge for willful misconduct, a prior warning is relevant in that it reflects the employee’s attitude toward his employment and adds to the willfulness of the misconduct. American Process Lettering, Inc., 412 A.2d at 1125-26.

However, even where a history of absenteeism is present, a claimant is entitled to receive compensation benefits where the final absence which precipitated his or her discharge was based on good cause. See Tritex Sportswear, Inc. v. Unemployment Compensation Board of Review, 315 A.2d 322, 324 (Pa. Cmwlth. 1980). But cf. Grand Sport Auto Body, 55 A.3d at 192-94 (holding that a claimant’s extensive absenteeism and history of tardiness constituted willful misconduct even if the claimant’s final absence before discharge was justified).

In this case, the court found that all of claimant's absences, including the last one, were for good cause.


The opinion, though not reported, may be cited "for its persuasive value, but not as binding precedent." 210 Pa. Code § 67.55. Citing Judicial Opinions.


Tuesday, April 01, 2014

federal courts - abstention - Younger abstention

Acra Turf Club v. Zanzuccki -  3d Cir. – March 341, 2014

ACRA Turf Club, LLC filed this suit pursuant to 42 U.S.C. §§ 1983 and 1988, against Francesco Zanzuccki , Executive Director of the New Jersey Racing Commission, asserting that certain amendments to New Jersey’s Off-Track and Account Wagering Act violate their rights under the United States Constitution.

The District Court dismissed the case on Younger abstention grounds, and Plaintiffs appealed. During the pendency of this appeal, the Supreme Court issued its decision in Sprint Communications, Inc. v. Jacobs, 134 S. Ct. 584 (2013), which clarifies and reminds courts of the boundaries of the Younger abstention doctrine. Because this action does not fit within the framework for abstention outlined in Sprint, we will reverse.

Wednesday, March 26, 2014

UC - willful misconduct - excessive v. limited absenteeism/tardiness

Morgan v. UCBR – Cmwlth. Court – March 26, 2014 – unreported memorandum opinion

Claimant failed to report for work on March 6, 2013 and did not notify Employer that she would be absent. On March 7, 2013, she received and signed a written warning for that absence and failure to notify. Although it advised that further attendance policy violations could result in termination of employment, this warning was marked as a “First Warning” and did not refer to any tardiness or absences other than the March 6, 2013 incident. On March 13, 2013, Claimant was absent from work, but notified Employer of her absence. On March 14, 2013, the following day, Claimant arrived at work five minutes late and was discharged by Employer for tardiness and absenteeism.

It is well established that excessive absenteeism or tardiness can constitute willful misconduct. Ellis v. Unemployment Compensation Board of Review, 59 A.3d 1159, 1163 (Pa. Cmwlth. 2013); Grand Sport Auto Body, 55 A.3d at 190; Fritz v. Unemployment Compensation Board of Review, 446 A.2d 330, 333 (Pa. Cmwlth. 1982). “Employers have ‘the right to expect that ... employees will attend work when they are scheduled, that they will be on time, and that they will not leave work early without permission.’” Grand Sport Auto Body, 55 A.3d at 190 (quoting Fritz). Thus, we have held that willful misconduct was shown where the claimant had a pattern of repeated tardiness or absences without good cause and the claimant had received warnings concerning his or her tardiness or absences. See Ellis, 59 A.3d at 1161, 1163-64 (claimant was late six times in a two and one-half week period, five of which were latenesses of 30 minutes, before she was discharged for arriving at work 45 minutes late); Grand Sport Auto Body, 55 A.3d at 190-92 (claimant was late 16 times in six months and was absent three days without excuse in the final month that he worked); Fritz, 446 A.2d at 331, 333 (in approximately two-month period, claimant was late six times, five times by 45 minutes or more, was absent once and left work early once).

The Board did not find any pattern of habitual or chronic tardiness or absences. Rather, the Board found only that Claimant had two absences and a single incident of being five minutes late for work.  This does not rise to the level of excessive absences and tardiness that constitutes willful misconduct. Nor can the conduct for which Claimant was discharged be properly characterized as willful misconduct on the ground that she violated Employer’s rules requiring notification of absences and lateness. While Claimant did not comply with Employer’s requirement that she call in the case of the first absence, she received a warning and was not discharged for that conduct. Claimant complied with Employer’s attendance policy with respect to the second absence. In the final incident, Claimant did not call Employer to notify that she would be five minutes late for work. .) The mere failure to notify of such a brief lateness on a single occasion does not by itself show the deliberate or intentional violation of Employer’s rules or disregard of standards of conduct that is required to support a finding of willful misconduct. See Philadelphia Parking Authority v. Unemployment Compensation Board of Review, 1 A.3d 965, 968-69 (Pa. Cmwlth. 2010) (violation of employer rule that was not shown to be intentional or deliberate does not constitute willful misconduct and does not shift burden to claimant to show good cause for rule violation).

We recognize that Employer contended that Claimant had a history of other absences and incidents of tardiness, in addition to the two absences and one five-minute lateness that preceded her discharge.  Employer’s witnesses, however, had no knowledge of those alleged absences and latenesses, and Employer’s documentation consisted solely of a list for the unemployment compensation proceedings with no evidence as to how it was prepared or on what it was based, not time or attendance records kept in the ordinary course of business.

Hearsay evidence, even if admitted without objection, cannot support a finding of fact unless it is corroborated by other competent evidence in the record. There was no evidence that corroborated Employer’s list of prior absences and tardiness; Claimant disputed Employer’s contentions that she had a history of unexcused absences and lateness, and the written warning that Claimant received and signed did not indicate that Claimant had any history of tardiness or any unexcused absences other than the March 6, 2013 incident. 
Accordingly, the Board did not find that Claimant had any history of absences or lateness before the three incidents of March 6, 2013, March 13, 2013, and March 14, 2013.

Because the two absences and single incident of tardiness found by the Board are insufficient to constitute willful misconduct, we reverse the order of the Board.


The opinion, though not reported, may be cited "for its persuasive value, but not as binding precedent." 210 Pa. Code § 67.55. Citing Judicial Opinions.

Monday, March 17, 2014

False Claims Act - pleading requirements - ED Pa. case - excerpts

US ex rel. Knisely v. Cintas Corporation – ED Pa. – March 14, 2014

It is well-established that claims under the False Claims Act must be pled with particularity under the special pleading standard of Fed. R. Civ. P. 9(b), which states in relevant part that “[i]n alleging fraud. . ., a party must state with particularity the circumstances constituting fraud[.]” See United States ex rel. Schmidt v. Zimmer, Inc., 386 F.3d 235, 242 n.9 (3d Cir. 2004); see also United States ex rel. LaCorte v. SmithKline Beecham Clinical Labs., Inc., 149 F.3d 227, 234 (3d Cir. 1998); accord Gold v. Morrison-Knudsen Co., 68 F.3d 1475, 1477 (2d Cir. 1995) (citing cases).

This heightened pleading standard serves a dual purpose. Requiring plaintiffs to plead with particularity “place[s] the defendants on notice of the precise misconduct with which they are charged” and also “safeguard[s] [them] against spurious charges of immoral and fraudulent behavior.” Seville Indus. Mach. Corp. v. Southmost Mach. Corp., 742 F.2d 786, 791 (3d Cir. 1984). In Judge Easterbrook’s oft-cited phrasing, plaintiffs must support their fraud allegations under Rule 9(b) with all the essential detailed factual circumstances that constitute “the first paragraph of any newspaper story” that is, “who, what, when, where and how.” DiLeo v. Ernst & Young, 901 F.2d 624, 627 (7th Cir. 1990) (cited in In re Rockefeller Ctr. Props., Inc. Sec. Litig., 311 F.3d 198, 217 (3d Cir. 2002). Our Court of Appeals has adopted a “flexible” alternative when plaintiffs cannot plead particularized evidence of a false claim, holding the plaintiff need not allege “date, place or time” if he can “inject[]precision and some measure of substantiation” by some other means into his allegations of fraud. Seville, 742 F.2d at 791.

As Wright and Miller teach, the degree of pleading particularity required under Rule 9(b) rests on the nature of the underlying fraud claim. 5A Charles Alan Wright and Arthur R. Miller, Federal Practice & Procedure, § 1298. While a simple allegation of fraud may suffice under the Bankruptcy Code, “considerable pleading particularity may be necessary to satisfy Rule 9(b) and to state a claim under the federal civil false claim statutes.” LaCorte, 149 F.3d at 234.

Our Court of Appeals has not specifically addressed how the Rule 9(b) pleading requirements deal with the false-claim elements. Knisely cites cases from our district court colleagues to urge that we apply a “generous” standard for Rule 9(b) under which he need not identify specific claims for payment. Mem. in Opp. at 12. But Knisely misconstrues the Rule's requirements as it pertains to his claim. He relies on United States ex rel. Wilkins v. United Health Group, Inc., 659 F.3d 295 (3d Cir. 2011), in which our Court of Appeals noted that “to our knowledge we have never held that a plaintiff must identify a specific claim for payment at the pleading stage of the case to state a claim for relief.” Id. at 308 (emphasis in original). But that passage referred specifically to the district court’s erroneous dismissal of a False Claims act case for a failure to plead under the Rule 12(b)(6) standard for a motion to dismiss, where the district court explicitly declined to apply the Rule 9(b) pleading requirements. Tellingly, our Court of Appeals then continued in Wilkins, “In any event. . . the question of whether a plaintiff, at the pleading stage, must identify representative examples of specific false claims that a defendant made to the Government in order to plead an FCA claim properly is a requirement under the more particular pleading standards of Rule 9(b).” Id. The Court thereafter cited with approval Ebeid ex rel. United States v. Lungwitz, 616 F.3d 993 (9th Cir. 2010), where that Circuit held:  We do not embrace the . . . categorical approach that would, as a matter of course, require a relator to identify representative examples of false claims to support every allegation[.] . . . We … conclud[e], in accord with general pleading requirements under Rule 9(b), that it is sufficient to allege “particular details of a scheme to submit false claims paired with reliable indicia that lead to a strong inference that claims were actually submitted.”  Id. at 998-99 (quoting United States ex rel. Grubbs v. Ravikumar Kanneganti, 565 F. 3d 180, 190 (5th Cir. 2009)).

Our colleagues have adopted that seemingly “flexible” standard for particularity where the specific details of claims have been elusive. See, e.g., United States ex rel. Schumann v. AstraZeneca PLC, 2010 WL 4025904 at *10 (E.D.Pa. Oct. 13, 2010) (Ditter, J.); see also United States ex rel. Budike v. PECO Energy, 897 F.Supp.2d 300 (E.D.Pa. 2012) (Surrick, J.). In short, even under our Court of Appeals’s so-called flexible approach to Rule 9(b), a relator must offer particulars to satisfy both the elements of an FCA claim and the Rule 9(b) pleading standards.

One who “knowingly presents, or causes to be presented, a false or fraudulent claim for payment or approval,” or “knowingly makes, uses, or causes to be made or used, a false record or statement material to a false or fraudulent claim” faces liability under Section 3729(a)(1)(A) and (B). To establish a prima facie False Claims Act violation, a plaintiff must prove that “(1) the defendant presented or caused to be presented to an agent of the United States a claim for payment; (2) the claim was false or fraudulent; and (3) the defendant knew the claim was false or fraudulent.” Wilkins, 659 F.3d at 305 (citing Schmidt, 386 F.3d at 242). There are two categories of false claims under the FCA, a factually false claim where the claimant misrepresents the goods or services it provided to the Government and a legally false claim where the claimant knowingly falsely certifies compliance with a statute or regulation that is a condition for Government payment. Id. ….

Rule 9(b) permits pleading “based upon information and belief”, particularly where key factual information remains within the defendant’s control. In re Burlington Coat Factory Securities Litigation, 114 F.3d 1410, 1418 (3d Cir. 1997). But such allegations are permissible “only if the pleading sets forth specific facts upon which the belief is reasonably based.” State Farm Mut. Auto. Ins. Co. v. Ficchi, 2012 WL 1578247 at *5 (E.D. Pa. May 4, 2012) (Pratter, J.). District courts in this Circuit have sometimes obliged plaintiffs even in the pleading stage of FCA actions to provide a statement of efforts undertaken to obtain information from the opposing party. See United States ex rel. Bartlett v. Tyrone Hospital, Inc., 234 F.R.D. 113, 122 (W.D.Pa. 2006) (granting defendants’ motion to dismiss). As Judge Buckwalter held in another FCA case, “cursory allegations, made on information and belief alone, are unquestionably insufficient to open the door to broad and burdensome discovery.” 

Wednesday, March 12, 2014

sheriff's sales - amendments to rules


The Rules of Civil Procedure governing sheriff’s sales have been amended in three respects:

Writ of garnishment - inactivity 

Current Rule 3111 governing the service of the writ on the garnishee provides for a continuing garnishment of defendant’s property until the underlying judgment is satisfied. Because garnishments can languish indefinitely without any action taken on them, the amendment introduces a procedure that would allow a defendant or a thirdparty garnishee to petition the court for termination of the garnishment provided that there has been no activity on the garnishment for at least one year. The plaintiff has the opportunity to respond to the petition and set forth the reasons the garnishment should not be terminated.

Sheriff's sale – postponement/continuance – noitice of new sale date

Current Rule 3129.3 governs the procedures for postponing or continuing a sheriff’s sale. The rule, however, is silent as to providing notice of the date to which a sheriff’s sale has been postponed. As a remedy, the amendment to Rule 3129.3 requires the plaintiff to file a notice of the date of continued sheriff’s sale with the prothonotary at least 15 days before the continued sale date. The plaintiff must also file a certificate of filing with the sheriff’s office confirming the filing of the notice with the prothonotary.

The failure to timely file the notice results in the sheriff continuing the sale until the next available sale date. However, noncompliance is not a basis for setting aside the sale unless it is raised prior to the delivery of the sheriff’s deed. A sale will only be set aside upon a showing of prejudice.

Correction of sheriff's deed – notice to junior lienholder

The amendment to Rule 3135, which governs the correction of the sheriff’s deed to real property, addresses the situation when a junior lienholder has failed to receive notice of mortgage foreclosure and has not been divested of its interest. Currently, the plaintiff is required to hold the sheriff’s sale again even though the junior lienholder typically has no interest in purchasing the mortgage. To remedy this duplication of effort and resources, the amendment allows for a plaintiff, its assigns, or the purchaser at the previously held sheriff’s sale to file a petition with a rule to show cause requesting that (1) the lien held by the junior lienholder be divested, (2) another sheriff’s sale be held in which only the junior lienholder specified in the petition may be the only other bidder

allowed other than the senior lienholder who acquired the property at the previously held sheriff’s sale, or (3) other relief approved by the court.



Thursday, January 30, 2014

SSD - age categories - no mechanical application

Rodriguez v. Astrue – ED Pa. – January 27, 2014

Held:  A plaintiff who is six months and one day from an older age category presents a borderline age situation that requires remand for consideration by the magistrate judge.  The ALJ must make an individualized determination as to whether plaintiff is more appropriately a “younger person” or a “person closely approaching advanced age.”

When describing how the age ranges will be applied, the regulations state:

We will not apply the age categories mechanically in a borderline situation. If you are within a few days to a few months of reaching an older age category, and using the older age category would result in a determination or decision that you are disabled, we will consider whether to use the older age category after evaluating the overall factors of your case.  20 C.F.R. §§ 404.1563(b), 416.963(b) (emphasis added).

The United States Court of Appeals for the Third Circuit has held that the district court should remand if (1) the ALJ mechanically applied an age category in a borderline case and (2) the borderline age analysis could change the ALJ’s determination of disability. Kane v. Heckler, 776 F.2d 1130, 1133–34 (3d Cir. 1985). An ALJ must make an individualized determination in a “borderline situation” because the “assumption [that individuals in certain age ranges have certain capabilities] becomes unreliable and a more individualized determination is necessary.” Id. at 1133.

At the time of the ALJ’s decision, plaintiff was sixth months and one day from her fiftieth birthday. Had the ALJ considered plaintiff to be “closely approaching advanced age” instead of a “younger person,” plaintiff would have been found disabled. R&R at 7–8. Thus, the question is whether six months and one day presents a borderline age case. If so, the case must be remanded to the ALJ for an individualized determination about what age range applies to plaintiff upon consideration of the overall factors in her case.

There is no test to determine when an applicant is “a few days or a few months” from an older age category. The Third Circuit held that a claimant who was fifty-four days from his fiftieth birthday presented a borderline age case. Kane, 776 F.2d at 1133. “Nine months appears to represent the outer perimeter of what constitutes a borderline case in the District Courts of the Third Circuit.” Ludvico v. Astrue, No. 08-322, 2008 WL 5134938, at *11 (W.D. Pa. Dec. 5, 2008). District courts in the Eastern District of Pennsylvania have found that claimants who are six months and three days from a higher age range present a borderline age case. Anderson v. Astrue, No. 12-4114 (E.D. Pa. Apr. 3, 2013) (order approving and adopting the report and recommendation of Magistrate Judge Timothy R. Rice) (finding a borderline age case when claimant was six months and three days from turning fifty); Copeland v. Astrue, No. 10-1482 (E.D. Pa. Nov. 22, 2010) (order approving and adopting the report and recommendation of Magistrate Judge Linda K. Caracappa) (finding a borderline age case when claimant was six months and three days from turning fifty-five); see also Williams v. Bowen, No. 86-3763, 1987 WL 9148, at *2 (E.D. Pa. Apr. 6, 1987) (finding that seven months was borderline).

This Court concludes that a plaintiff who is six months and one day from an older age category presents a borderline age situation that requires remand for consideration by the magistrate judge. On remand, the ALJ must make an individualized determination as to whether plaintiff is more appropriately a “younger person” or a “person closely approaching advanced age.”