Virciglio v. Work Train Staffing LLC

• Decision Date: 30 December 2016
• Docket Number: No. 15-10421,15-10421
• Parties: SAM A. VIRCIGLIO, Plaintiff-Appellee, v. WORK TRAIN STAFFING LLC, WORK TRAIN USA LLC, FRANK PETRUSNEK, Defendants-Appellants.
• Court: United States Courts of Appeals. United States Court of Appeals (11th Circuit)

SAM A. VIRCIGLIO, Plaintiff-Appellee,
v.
WORK TRAIN STAFFING LLC, WORK TRAIN USA LLC, FRANK PETRUSNEK, Defendants-Appellants.

No. 15-10421

UNITED STATES COURT OF APPEALS FOR THE ELEVENTH CIRCUIT

December 30, 2016

DO NOT PUBLISH

D.C. Docket No. 2:12-cv-03738-AKK

Appeal from the United States District Court for the Northern District of Alabama

Before ROSENBAUM and JULIE CARNES, Circuit Judges, and GOLDBERG,^* Judge.

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JULIE CARNES, Circuit Judge:

Plaintiff Sam Virciglio was fired from his job and thereafter sued his employer for retaliation, in violation of the Age Discrimination in Employment Act ("ADEA") and Title VII, and for failure to notify Plaintiff of his rights under the Comprehensive Omnibus Budget Reconciliation Act ("COBRA"). The district court granted summary judgment to Plaintiff on the COBRA claim and a jury found for him on the retaliation claim. Thereafter, the district court entered judgment consistent with its earlier ruling and with the jury's verdict. Defendants now appeal this judgment. After careful review of the record, and with the benefit of oral argument, we affirm.

BACKGROUND

I. Factual Background

This case arises out of Plaintiff's employment with and subsequent termination from Defendants Work Train USA and Work Train Staffing (collectively, "Work Train" or "Defendants").¹ Work Train is in the staffing business. It earns revenues by hiring staffing employees whom it then uses to provide services to Work Train clients and by claiming federal tax credits for its hiring of these staffing employees. Defendant Petrusnek is one of the owners of

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Work Train. He hired Plaintiff in September 2010 as a sales manager for Work Train. In addition to a salary, Plaintiff's compensation included employer-paid health insurance with family coverage through Blue Cross Blue Shield.

According to Defendants, Plaintiff failed to meet sales expectations during his first year of employment. As a result, in November 2011, Defendants changed Plaintiff's compensation to a commission-based system and informed him that he would have to start paying the full premium for his health insurance in January 2012. Defendants also assigned Plaintiff a monthly sales quota, effective immediately.

Plaintiff failed to meet his December 2011 sales quota, and he took leave during the last few days of that month to spend time with his wife, who was terminally ill and being treated for cancer. When Plaintiff returned to work on January 3, 2012, Petrusnek met with him to discuss his performance and to determine whether Plaintiff was anticipating any upcoming sales. Plaintiff claims that he gave Petrusnek a letter during the January 3 meeting accusing Defendants of age and gender discrimination.

On January 4, 2012, the day after his meeting with Petrusnek, Plaintiff filed an EEOC charge alleging gender discrimination. Two days later, on January 6, 2012, Petrusnek met with Plaintiff again and this time fired him, allegedly for performance reasons. Construing the facts in favor of Plaintiff, Petrusnek had by

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that date received Plaintiff's letter alleging age and gender discrimination, but was not yet aware of Plaintiff's EEOC charge.

During this January 6 termination meeting, Petrusnek informed Plaintiff that part of his January 2012 insurance premium had been deducted from his final paycheck, and that Defendants would pay the remaining portion. Consistent with this information, Plaintiff's final paycheck included a $467 deduction for "Health." Based on this conversation with Petrusnek, Plaintiff therefore believed he had insurance coverage through January 2012, and that he did not need to obtain alternative coverage until February 2012. Defendants never notified Plaintiff, either during the January 6 meeting or at any other time prior to this lawsuit, of his right under COBRA to continuation of coverage.

Defendants received notice of Plaintiff's EEOC charge in mid-January 2012.² A few weeks later, Petrusnek contacted Blue Cross and requested that Plaintiff's health insurance be canceled retroactive to January 1, 2012. Petrusnek's request was honored, and Work Train received a refund of $1,904 from Blue Cross for Plaintiff's first quarter premium. Defendants did not offer to reimburse Plaintiff for the $476 part of the premium that had been deducted from his final paycheck until after Plaintiff filed this lawsuit.

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Plaintiff's wife died in March 2012. The following month, Plaintiff learned that Defendants had retroactively canceled his insurance, which meant he had no medical coverage for the month of January 2012. Although Plaintiff had purchased alternative insurance that began on February 1, 2012, he had incurred in January more than $50,000 in medical expenses, primarily for his wife's cancer treatments. These expenses had been initially paid by Blue Cross, but it subsequently rebilled Plaintiff for payment and ultimately sent the billing to collections. At some point during this litigation, Defendants requested reinstatement of Plaintiff's health insurance for January 2012, and the bills were then paid.

II. Procedural History

After his termination and subsequent discovery of the retroactive cancellation of his insurance, Plaintiff filed this lawsuit alleging: (1) a violation of his COBRA notice rights, (2) age and gender discrimination in violation of the ADEA and Title VII, (3) retaliation in violation of the same statutes; and (4) fraud and misrepresentation in violation of various state laws. Following discovery, the parties filed cross-motions for summary judgment.

The district court granted summary judgment to Defendants on Plaintiff's age and gender discrimination claims, but found that questions of fact precluded summary judgment on Plaintiff's retaliation claims, as well as on some of his state

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law claims. With respect to the COBRA claim, the court granted summary judgment to Plaintiff, finding as a matter of law that: (1) Defendants did not qualify for the small-employer exception to COBRA; (2) Plaintiff's termination was a qualifying event that triggered COBRA's notice requirement; (3) Defendants failed to provide the required notice; and (4) Defendants did so in bad faith, warranting a penalty under COBRA. The court advised Defendants that it would determine at trial the amount of the penalty to be imposed.

The district court subsequently held a jury trial on Plaintiff's remaining claims. At the close of Plaintiff's evidence, Defendants moved for judgment as a matter of law, arguing that there was insufficient evidence to support those claims and further that Defendant Work Train USA was not subject to any liability because it was not Plaintiff's employer at the time of his termination. Plaintiff did not oppose the motion as to his state law claims, and the district court dismissed those claims. The court, however, declined to enter judgment as to the other claims, and it submitted the case to the jury.

The jury returned a verdict for Plaintiff based on Defendants' retaliatory cancellation of Plaintiff's insurance and awarded him $75,000 in compensatory damages. The jury also found that the retaliation was willful under the ADEA, resulting in an additional $75,000 award to Plaintiff. Finally, it awarded $175,000 in punitive damages under Title VII. For its part, and in accordance with its earlier

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grant of summary judgment to Plaintiff on the COBRA notice claim, the district court imposed a $3,300 penalty based on that claim.³ Thus, consistent with the above verdict and its own ruling, the court entered a judgment that incorporated the jury's award of damages against Work Train in the amount of $325,000, in addition to the court's award of a penalty against Defendants Work Train and Petrusnek in the amount of $3,300 for the COBRA notice claim.

Defendants appeal the judgment entered against them. They argue that the district court erred by: (1) allowing Plaintiff to amend his complaint after the scheduling order deadline to add a COBRA notice claim, (2) denying Defendants' Batson challenge during jury selection, (3) denying Defendants' motion for judgment as a matter of law as to Plaintiff's retaliatory cancellation claim and as to Defendant Work Train USA's liability on that claim, (4) refusing to give Defendants' requested jury instruction concerning "but for" causation, and (5) entering judgment in favor of Plaintiff on his COBRA notice claim.

DISCUSSION

I. COBRA Amendment

The scheduling order set a deadline of May 30, 2013 for amending the pleadings. On June 14, 2013, which was about two weeks after the deadline

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expired, Plaintiff filed a motion for leave to amend the complaint to add the COBRA notice claim on which he ultimately prevailed at summary judgment. Defendants argue that the district court erred by granting Plaintiff's motion and allowing the amendment.

Federal Rule 16(b) allows an amendment outside the date specified in the scheduling order "for good cause and with the judge's consent." Fed. R. Civ. P. 16(b)(4). The district court consented to Plaintiff's amendment, finding good cause for the delay because Plaintiff did not learn until his deposition on June 12, 2013 that Defendants had in fact purchased insurance for him in January 2012 (before retroactively cancelling it) and that he was thus arguably a covered employee entitled to COBRA notice at the time of his termination.

We review the district court's good cause finding for an abuse of discretion. Sosa v. Airprint Sys., Inc., 133 F.3d 1417, 1418 (11th Cir. 1998). There clearly was no abuse of discretion here. The record shows that in spite of his diligence, Plaintiff did not have the information necessary to assert a viable COBRA notice claim until after the amendment deadline expired. See id. at 1419 (noting that diligence is required to support a good cause finding). It was thus within the court's discretion to allow the amendment.

II. Batson Challenge

Following voir dire, Plaintiff used each of his...