Farley v. Altasource, LLC d/b/a Meta Labs, LLC (agency decision, August 20, 2019)

Plain-English summary

Lan Farley worked for a dietary-supplement and cosmetics company for about eleven days before her discharge. The ALJ found that she engaged in some protected food-safety activity but credited testimony that she did not follow instructions, perform the compliance duties for which she was hired, communicate responsively, or demonstrate the claimed expertise. The Board deferred to those credibility findings because they were not inherently incredible or patently unreasonable. It held that substantial evidence supported the company's clear-and-convincing showing that it would have discharged Farley regardless of protected activity. The Board affirmed and denied the complaint.

Decision snapshot

• Cited authorities: 21 U.S.C. § 399d; 29 C.F.R. §§ 1987.109(b) and 1987.110
• Outcome: The employer's same-action defense and denial of the FSMA complaint affirmed.
• Key point: Compliance duties may include protected activity, but an employer can still prevail by clearly and convincingly proving discharge for separable performance failures.

Full text (DOL official public release)

U.S. Department of Labor Administrative Review Board
200 Constitution Avenue, N.W.
Washington, D.C. 20210

  In the Matter of:



  LAN FARLEY,                                           ARB CASE NO. 2016-0091

        COMPLAINANT,                                    ALJ CASE NO. 2015-FDA-0001

         v.                                              DATE: August 20, 2019

  ALTASOURCE, LLC, d/b/a,
  META LABS, LLC,

        RESPONDENT.



  Appearances:

  For the Complainant:
        Drew Mosley, Esq.; Drew Mosley, LLC; Lawrenceville, Georgia

  For the Respondent:
        William J. Piercy, Esq.; Berman Fink Van Horn P.C.; Atlanta, Georgia

  Before: William T. Barto, Chief Administrative Appeals Judge; James A.
  Haynes and Daniel T. Gresh, Administrative Appeals Judges



                             FINAL DECISION AND ORDER

         PER CURIAM. This case arises under the employee protection provisions of the
  Federal Food, Drug, and Cosmetic Act (FFDCA or the Act) 1, as amended by Section

  1      21 U.S.C. § 301 et seq. (1938).



  402 of the Food Safety and Modernization Act of 2011 2 (FSMA), and its
  implementing regulations at 29 C.F.R. § 1987 (2016). Section 402 of the FSMA
  protects an employee who has engaged in protected activity pertaining to a violation
  or alleged violation of the FFDCA, or any order, rule, regulation, standard, or ban
  under the FFDCA, from retaliation. On April 7, 2014, Complainant filed a
  complaint with the U.S. Department of Labor’s Occupational Safety and Health
  Administration (OSHA), claiming that the Respondent retaliated against her for
  engaging in FSMA-related protected activities when it discharged her for raising
  safety concerns. Joint Exhibit 10; Administrative Law Judge Exhibit 3. OSHA
  dismissed the complaint and the Complainant asked for a hearing before an
  Administrative Law Judge (ALJ). After a hearing, the ALJ concluded that the
  Respondent had demonstrated by clear and convincing evidence that it would have
  discharged the Complainant in the absence of her protected activity. Complainant
  appealed to the Administrative Review Board (ARB or Board). For the reasons set
  forth below, we affirm the ALJ’s decision and order.

                                      BACKGROUND

          The Respondent is a Georgia company that manufactures and distributes
  dietary supplements and cosmetics. Decision and Order Denying Complaint (D. &
  O.) at 3. Bassam Khayat is the company president and his wife, Rosa Khayat, was
  at all pertinent times the vice president. Respondent’s Exhibit at 3. The
  Complainant, Lan Farley, worked for the Respondent for eleven days from March
  10, 2014, until her discharge on March 21, 2014. D. & O. at 3. 3

         On April 7, 2014, Complainant filed her complaint with OSHA. Subsequent
  to an investigation, OSHA determined (1) that there was no evidence to corroborate
  Complainant’s claimed protected activity, and (2) that the investigation
  corroborated the Respondent’s proffer that Complainant’s discharge was the result
  of her failure to demonstrate proficiency in regulatory compliance matters, for
  which she was hired. OSHA thus dismissed the complaint. Administrative Law




  2      Id. § 399d (2016).

  3     The Separation Notice that Rose Khayat signed indicates, however, that the
  Respondent employed Complainant from March 9, 2014, to March 22, 2014. Joint Exhibit 4.



  Judge Exhibit 4. Complainant objected to OSHA’s determination and requested a
  hearing. Administrative Law Judge Exhibit 5.

         After conducting a formal hearing, the ALJ concluded that Complainant had
  established that “[o]n some level . . . . although it is difficult to discern exactly what,
  she engaged in protected activity.” D. & O. at 19. The ALJ also concluded, however,
  that Complainant did not meet her burden to establish that her protected activity
  contributed to Mr. Khayat’s decision to terminate her employment. Id. at 20-22. The
  ALJ further concluded that the Respondent had demonstrated by clear and
  convincing evidence that it would have discharged Complainant in the absence of
  her protected activity under 29 C.F.R. § 1987.109(b). Specifically, the ALJ reached
  the following conclusions:

         For all these reasons, I find that even assuming, arguendo, that the
         Complainant made a prima facie case that her protected activity
         contributed to her termination based on temporal proximity, the
         Respondent has established by clear and convincing evidence that it
         would have fired her regardless of her protected activity, for legitimate
         non-retaliatory reasons having to do work performance, inability to
         follow directions, and problems with communication. Furthermore, if
         the Respondent’s evidence is considered along with the Complainant’s
         to determine whether a prima facie case was established, see [the
         Board’s 2016 decision in] Powers v. Union Pacific Railroad Co., ARB No.
         13-034, ALJ No. 2010-FRS-030 (ARB Jan. 6, 2017) pet. denied 723 F.
         App’x 522 (9th Cir. 2018)], then the Respondent’s evidence is sufficient
         to overcome any inference based on temporal proximity and precludes a
         finding that the Complainant even established a prima facie case that
         her protected activity contributed to her termination.

  D. & O. at 26. Determining that the Respondent had thereby established its
  affirmative defense, the ALJ denied the complaint. Id. Complainant appealed to the
  Board, alleging error in the ALJ’s findings on protected activity, causation, and the
  Respondent’s affirmative defense. The Respondent opposes the appeal.





                        JURISDICTION AND STANDARD OF REVIEW

         The Secretary of Labor has delegated authority to the Board to act on appeals
  from decisions by ALJs in cases brought under the FSMA and to issue final agency
  decisions in those matters for the Department of Labor. 4 “The ARB will review the
  factual determinations of the ALJ under the substantial evidence standard.” 5

                                      DISCUSSION

         Dispositive to this case is the ALJ’s finding that the Respondent would have
  taken the same adverse action in the absence of Complainant’s protected activity. 6
  29 C.F.R. § 1987.109(b). D. & O. at 22, 26. Upon review of the ALJ’s D. & O. and the
  record evidence, we conclude that the ALJ’s decision is a reasoned ruling supported
  by substantial evidence and consistent with applicable law. The ALJ, acting within
  his discretion, rationally credited the testimony of both Mr. and Mrs. Khayat, the
  company’s president and vice president, that Complainant did not follow
  instructions; was not doing the compliance job duties for which she was hired;
  showed an inability to grasp what work product Mr. Khayat wanted from her; was
  not responsive to Mr. Khayat’s questions or work assignments; did not make reports
  as directed; failed to grasp the scale of the Respondent’s operation and its particular
  needs; did not provide solutions to specific problems; and did not show that she
  possessed the expertise she claimed to have. D. & O. at 22-24. The ALJ determined
  that the testimony of Mr. and Mrs. Khayat was consistent regarding the grounds for
  Complainant’s discharge, namely because she was not doing her job, had
  misrepresented her qualifications, and was not following instructions. Id. at 24-26.
  The ALJ’s conclusion that the Respondent had established by clear and convincing


  4      Secretary’s Order 01-2019 (Delegation of Authority and Assignment of
  Responsibility to the Administrative Review Board), 84 Fed. Reg. 13072 (Apr. 3, 2019); 29
  C.F.R. § 1987.110(a).

  5      29 C.F.R. § 1987.110(b).

  6       We note that where an employee’s regular job duties include reporting to his or her
  employer any suspected statutory or regulatory compliance violations, those duties may
  include protected activity under the plain language of 21 U.S.C. § 399d(a). However, this
  does not mean that the employee cannot be discharged for legitimate reasons unrelated to
  the protected activity. It is still a complainant’s burden to establish, by a preponderance of
  the evidence, that specific, identifiable instances of protected activity caused adverse action,
  just as it is the employer’s burden to properly prove any defense the statute provides.



  evidence that it would have discharged Complainant in the absence of her protected
  activity, thereby establishing its affirmative defense, is therefore supported by
  substantial evidence and is in accordance with law. 7 On appeal, Complainant
  argues that her testimony and other evidence shows that she did in fact know what
  she was talking about at work and that she has an impressive resume.
  Complainant’s Brief at 2, 4-5. The Board, however, gives considerable deference to
  an ALJ’s credibility determinations and defers to such determinations unless they
  are inherently incredible or patently unreasonable. 8 In this case, we hold that the
  ALJ’s credibility determinations are neither inherently incredible nor patently
  unreasonable and thus, we defer to them. 9 Consequently, the ALJ’s conclusion that
  the Respondent established by clear and convincing evidence that it would have
  discharged Complainant in the absence of her protected activity, thereby
  establishing its affirmative defense, is affirmed.

                                         CONCLUSION

         Accordingly, the complaint in this matter is hereby DENIED.

         SO ORDERED.



  7      Given the unusual facts of this particular case, it is helpful to clarify that the ALJ
  concluded that the Complainant had engaged in some poorly specified protected activity. All
  parties agreed that Complainant had been hired with job duties that, on their face, would
  include a considerable component of protected activity. However, the ALJ also concluded
  that Respondent had demonstrated, by clear and convincing evidence, that Complainant’s
  performance of her job duties was incompetent and that Respondent would have terminated
  Complainant irrespective of any protected activity. We affirm the ALJ’s finding that
  Complainant’s job description was separable from her actual job performance and that the
  distinction supports the result in this appeal.

  8      See, e.g., Knox v. Nat’l Park Serv., ARB No. 10-105, ALJ No. 2010-CAA-002, slip op.
  at 5 (ARB Apr. 30, 2012).

  9       The ALJ left open the record for Complainant to submit documents that would allow
  for the calculation of damages in the event he awarded damages. Hearing Transcript at 267.
  Complainant submitted documents post-hearing. Brief of Complainant. On appeal,
  Complainant argues that the ALJ erred by not addressing these documents. As we affirm the
  ALJ’s conclusion that the Respondent established by clear and convincing evidence that it
  would have discharged Complainant in the absence of her protected activity, however, we
  need not address Complainant’s contention.