Skip to content

Legal Report May 2014


DATA BROKERS. A federal court has reversed a lower court’s ruling, saying that an investigative firm did not exercise “reasonable care” in releasing personal information to a Web site that was ultimately used to violate the Driver’s Privacy Protection Act (DPPA). The court reasoned that if the firm had “been reasonably diligent” it could have discovered that the information was intended for “improper purposes.”

On October 10, 2009, Erik Gordon was at a restaurant in New York City and his driver was waiting outside in Gordon’s car, which had a New York State license plate and was registered in his name. Aron Leifer was parked across the street in an SUV, and he and Gordon’s driver engaged in a verbal altercation. Gordon’s driver then drove away, but Leifer chased him to a local police precinct. The driver waited for Leifer to leave and then returned to the restaurant.

Leifer later claimed that the two cars collided during the chase, but he never contacted the police or filed an insurance claim. However, during the evening Leifer wrote down the license plate number of Gordon’s vehicle.

The next day, October 11, Leifer entered Gordon’s license plate number on From a dropdown menu of purposes deemed by the site to be permissible under the DPPA, Leifer selected “Insurance Other.” After certifying that his actions were in compliance with the DPPA, Leifer entered his personal information into the site using the alias Jack Loren, saying that he worked for, and used his own credit card number, under Loren’s name, to purchase information.

After paying $39, Leifer received Gordon’s name and home address. He used the information to make a series of Internet searches and identified Gordon’s phone number, the members of Gordon’s family and acquaintances, and their contact information. Leifer then called Gordon’s assistant, his mother, and his father’s secretary. During the calls, Leifer made threatening comments, including the false allegation that Gordon had sexually assaulted a woman. Leifer did not deny making the calls, but said he called the individuals because he was trying to contact Gordon to get his insurance information.

Gordon filed suit against Leifer and those responsible for obtaining his information from the New York State Department of Motor Vehicles, including Softech International, Inc., which processed the request for Gordon’s information. Softech provides access to motor vehicle records of all 50 states, Washington, D.C., Puerto Rico, and six provinces in Canada. Gordon also filed suit against Arcanum Investigations, Inc., which provided his information to Softech. Gordon settled with Leifer out of court and dropped charges against him. However, Gordon pursued charges against Softech International and Arcanum, but the U.S. District Court for the Southern District of New York dismissed his claims.

Gordon appealed the decision and the U.S. Court of Appeals for the Second Circuit upheld the lower court’s decision in part, saying that Softech International was not liable for the breach in his privacy. The court ruled that because Leifer accepted full responsibility for his actions under the DPPA by clicking “OK” on a disclaimer, Softech International was not responsible for his actions. Gordon appealed to the U.S. Supreme Court, which declined to hear the case.

However, the Second Circuit allowed the case against Arcanum to go forward because it failed to check the accuracy of Leifer’s alias, Jack Loren; his business affiliation,; and his credit card number. The court ruled that because of this, a reasonable jury could find that “Arcanum failed to use reasonable care” and if it had done so, would have discovered that Leifer was going to use the information for an improper purpose. (Gordon v. Softech International, Inc., Arcanum Investigations, Inc., U.S. Court of Appeals for the Second Circuit, No. 12-661-cv, 2014)

COMPENSATION. Employers don’t have to compensate employees for time spent before and after work donning and doffing clothing required for their job if the employer and the workers’ union have agreed to a collective bargaining agreement that such activity would not be compensated, the U.S. Supreme Court held unanimously. Clift on Sandifer and other employees and former employees of the United States Steel Corporation filed suit in 2009 in the U.S. District Court for the Northern District of Indiana under the Fair Labor Standards Act. They were seeking backpay for time spent “donning and doffing various pieces of protective gear” that they were required to wear while working because of hazards regularly encountered in steel plants. Some of the common items of clothing that employees were required to wear included hardhats, snoods, wristlets, work gloves, leggings, metatarsal boots, safety glasses, earplugs, a respirator, and flame-retardant jackets, pants, and hoods.

The time it took for employees to put on and take off this protective gear was “quite large” and they sought to be compensated for it, according to court documents. However, U.S. Steel contended that it did not have to compensate employees for time changing gear as it had already established a collective-bargaining agreement with the employees’ union, which said that “time spent in changing clothes…at the beginning or end of each workday” is “noncompensable.”

The District Court ruled in favor of U.S. Steel, saying that putting on and taking off protective gear was changing clothes and therefore not compensable under the collective-bargaining agreement. Sandifer and the other employees appealed the decision, which ultimately reached the U.S. Supreme Court.

Associate Justice Antonin Scalia delivered the opinion of the court and ruled that “changing clothes” means substituting, or altering, one’s dress. The court determined that most of the protective clothing and gear worn by the workers fell within the meaning of clothes as defined in the Fair Labor Standards Act. Because of this, the Court ruled that the time workers spent donning and doffing the protective clothing and gear they wore for work did not require compensation. (Sandifer v. United States Steel Corp., U.S. Supreme Court, No. 12-417, 2014)


CHEMICAL SAFETY. In light of the chemical spill that left more than 300,000 West Virginians without a safe water supply, Sen. Joe Manchin III (DWV) introduced a bill (S. 1961) in the Senate that is designed to help protect Americans from chemical spills that threaten drinking water. The bill was cosponsored by Sen. Barbara Boxer (DCA), chairwoman of the Environment and Public Works Committee, and Sen. Jay Rockefeller (D-WV).

The bill would require regular state inspections of above-ground chemical storage facilities and require the chemical industry to develop state-approved emergency response plans that meet minimum guidelines established in the bill. The bill would also allow states to recoup costs incurred from responding to emergencies related to spills and ensure that those who manage drinking water systems have the tools and information to respond to emergencies.

S. 1961 has been referred to the Senate Environment and Public Works Committee.

BULLYING. A bill (H.R. 3911) introduced in the House seeks to amend the Safe and Drug-Free Schools and Communities Act to include bullying and harassment prevention programs. Introduced by Rep. Danny Davis (D-IL), the bill would require states to provide assistance to districts and schools in their efforts to prevent and respond to incidents of bullying and harassment.

The bill would require that schools implement programs to address the causes of bullying and harassment and to train teachers, administrators, and counselors on strategies to prevent bullying and harassment. The bill would also require that complaint procedures for those who want to register a complaint of harassment or bullying with the school be made available to parents and students.

The bill has been referred to the House Education and Workforce Committee.

SURVEILLANCE. In light of the President’s Review Group on Intelligence and Communications Technologies, several bills have been introduced in the House of Representatives to make changes to the National Security Agency (NSA). H.R. 3883, introduced by Rep. Alan Grayson (D-FL) with no cosponsors, would require the president and all executive departments to take all actions recommended by the President’s Review Group on Intelligence and Communications Technologies. The review group made 46 recommendations, including requiring bulk telephony metadata be held by a private provider or by a private third party instead of by the government.

The bill would also require all agencies and the federal government to take all actions, including rulemaking, needed to implement the 46 recommendations the review group issued on the NSA’s surveillance programs. H.R. 3883 would require the actions to be taken within one year and that all necessary executive orders be issued within six months of enactment. The bill is currently being reviewed by the House Committee on Intelligence.

Another bill (H.R. 3882), introduced by Rep. John Carney, Jr. (D-DE), would also make changes to NSA programs by amending the Foreign Intelligence Surveillance Act of 1978 to require the comptroller general to report annually to the House and Senate Intelligence and Judiciary Committees on the effectiveness of the programs and activities carried out under the act.

H.R. 3882 would require reports to include analysis of the restrictions placed on access to information obtained under the act, the number of incidents of noncompliance with the act, a description of actions taken in response to such incidents, and other requirements. It has been referred to the House Judiciary Committee for review.

In addition to the bills introduced in the House, senior members of the House Judiciary Committee, Representatives Jim Sensenbrenner (R-WI), Darrell Issa (R-CA), and Jerrold Nadler (D-NY), sent a letter to Deputy Attorney General James Cole expressing concerns about the collection of information on call records from Congressional offices. The letter urged the Justice Department to “fully disclose all of the ways in which the government conducts or may possibly conduct surveillance on members of Congress.”

As of press time, the Justice Department has not issued a response to the letter.

EMPLOYMENT. Rep. Rosa DeLauro (D-CT) and Rep. Hank Johnson (D-GA) have introduced a bill (H.R. 3972) that would prohibit employment discrimination based on unemployment. The measure would prevent employers and employment agencies from refusing to consider or offer a job to an unemployed individual.

The bill would also prohibit the publication of an advertisement or announcement for a job that includes language indicating the unemployed “need not apply.” Additionally, the bill would allow those discriminated against to bring a civil action against the employer, or employment agency, for actual, compensatory, and punitive damages. It has been referred to the House Committee on Education and the Workforce.

Senator Richard Blumenthal (D-CT) has introduced a similar bill (S. 1972) in the Senate. It is currently being reviewed by the Senate Health, Education, Labor, and Pensions Committee.


For the fifth year in a row, retaliation-based charges were the most common charges filed with the U.S. Equal Employment Opportunity Commission (EEOC), which is responsible for enforcing federal laws that discriminate against job applicants or employees. The statistic comes from the EEOC’s annual enforcement and litigation statistical report that’s released each year to the public.

In fiscal year 2013, the EEOC received 93,727 charges and 41.1 percent—38,539—were retaliation based, an increase of 3 percent from 2012. This was closely followed by race discrimination with 35.3 percent; sex discrimination, which includes sexual harassment and pregnancy discrimination, with 29.5 percent; and disability discrimination, with 27.7 percent.

The total number of charges filed with the EEOC decreased 5.7 percent from 2012 in 2013, but claimants recovered a record $372 million—an increase of $6.7 million from 2012. Additionally, the EEOC resolved more charges of discrimination than it took in, “despite sequestration which caused the agency to furlough its entire workforce for 40 hours, freeze hiring, and reduce its budget for litigation, information technology, travel, and contracts for services, among other services,” according to a press release from the EEOC.

Broken down among the states, the number of charges largely tracks with population. Texas employers faced more EEOC charges than any other state with a total of 9,068 charges, or 9.7 percent of all charges filed in the nation. Florida employers were the second most likely to face charges with 7,597, California was third with 6,892, and Georgia was fourth with 5,162 charges. In contrast, 11 states had fewer than 100 charges filed in 2013, including Montana, Vermont, Maine, New Hampshire, Rhode Island, and North and South Dakota


Grandparent leave. The Illinois General Assembly is considering a bill that would require employers to provide grandparent leave. The bill (S.B. 3105) would require employers to provide up to 12 weeks of unpaid family medical leave to an employee during any 12-month period for the birth or adoption of a grandchild if the employee will be caring for the child; for the placement of a grandchild with the employee for adoption or foster care; or for a serious health condition of a grandchild so the employee can care for the grandchild. The bill also would allow employees to take leave to care for a grandparent who has a serious health condition.

If the bill were to pass, it would become effective immediately and allow employees to file civil action for enforcement.

This column should not be construed as legal or legislative advice.