Florida Labor and Employment Attorneys

On November 20, 2024, Florida’s First District Court of Appeal (“First DCA”) rendered its opinion in Gessner v. Southern Company & Gulf Power Company, No. 1D2023-2297 (1st DCA Nov. 20, 2024).[1] In the opinion, the First DCA addressed whether under Florida’s Private Sector Whistleblower’s Act (“FWA”), section 448.101, et seq., Florida Statutes, a plaintiff must show “that he objected to, or refused to participate in, an actual violation of a law, rule, or regulation by his employer in order to be protected nder the FWA from employment retaliation, as opposed to showing only a good faith, reasonable belief that a violation occurred.”[2] The trial court had determined that the plaintiff had to show he objected to an actual violation and granted summary judgment in favor of the defendants.[3]

The First DCA did not provide many pertinent background facts in Gessner, except to say that the plaintiff alleged that “he was discharged in retaliation for objecting to certain practices ‘that were in violation of state and/or federal laws or that he reasonably and objectively believed were in said violation.’”[4] The trial court rejected the plaintiff’s claim that “he needed to present evidence of a good-faith, objectively reasonable belief that his employer’s actions were illegal, not proof that an actual violation occurred.”[5] In making his argument, the plaintiff relied upon the Fourth District Court of Appeal’s (“Fourth DCA”) decision in Aery v. Wallace Lincoln-Mercury, LLC, 118 So. 3d 904 (Fla. 4th DCA 2013).[6] The defendants relied upon, and the trial court agreed, with the Second District Court of Appeal’s (“Second DCA”) reasoning in Kearns v. Farmer Acquisition Co., 157 So. 3d 458 (Fla. 2d DCA 2015), that “in order to be protected under the private sector FWA as set forth in section 448.102(3), an employee must show that an employer committed an actual violation of a law, rule, or regulation.”[7] The First DCA thus faced the question of whether to agree with the Aery opinion or the Kearns opinion.

Ultimately, the First DCA determined that it agreed with the Second DCA. The court quoted extensively from the Kearns opinion and a federal court opinion cited by the Kearns court.[8] In agreeing with Kearns that “a plaintiff in a private sector FWA action brought pursuant to section 448.102(3) must establish that he or she objected to, or refused to participate in, an activity, policy, or practice of the employer that is an actual violation of a law, rule, or regulation,” the First DCA asserted that it was “guided first and foremost by the plain language of section 448.102(3).”[9] The court determined that “[h]ad the Legislature wished to provide the same whistleblower protection for private sector employees who disclose suspected violations of law as it did for public sector employees under section 112.3187(5)(a) (which provides that reporting of “[a]ny violation or suspected violation” of a law, rule, or regulation is covered under the statute), it certainly could have done so.”[10] As relevant in Gessner, the FWA provides protection where an individual “[o]bjected to, or refused to participate in, any activity, policy, or practice of the employer which is in violation of a law, rule, or regulation.”[11]

The court further noted that “a number of federal district courts have approved the reasoning in Kearns and not Aery,” although the court did not acknowledge that federal district courts have also sided with the Aery court.[12] The court concluded its analysis but contending that “[i]t is not for us to judge the reasoning behind the Legislature’s decision in the private sector employment arena.”[13] The First DCA thus affirmed the summary judgment entered in favor of the defendants in the lower court.[14]  The court did certify conflict with the Fourth DCA, meaning that the Florida Supreme Court may accept jurisdiction to resolve the conflict if it chooses.[15]

It is hoped that the Florida Supreme Court will indeed accept jurisdiction if Gessner seeks review by Florida’s highest Court.  There is clearly a conflict among the district courts and the federal courts, and guidance is needed for both litigants and practitioners. We will continue to monitor this issue and will provide an update once it is available.

If you have any questions or concerns regarding this topic, or any topic related to labor and employment law, please contact us.

[1] The opinion is available at the following link: https://1dca.flcourts.gov/content/download/2443663/opinion/Opinion_2023-2297.pdf (last visited Dec. 3, 2024).

[2] Gessner, at *2.

[3] Id., at *1.

[4] Id., at *2.

[5] Id.

[6] Id.

[7] Id.

[8] See id., at *4-7.

[9] Id., at *8.

[10] Id.

[11] § 448.102(3), Fla. Stat. (2024).

[12] Gessner, at *8-9; see, e.g., Rivera v. Spirit Airlines, Inc., 2020 U.S. Dist. LEXIS 15286 (S.D. Fla. Jan. 30, 2020), at *2 (“Despite the different approaches, ‘Aery remains the controlling law on the issue because the discussion concerning the actual violation standard in Kearns was only in dicta.’” (citations omitted)).

[13] Gessner, at *9.

[14] Id., at *9.

[15] Id.

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On September 19, 2024, the Eleventh Circuit rendered its opinion in McCreight et Wester v. AuburnBank, et al., Case No. 22-12577 (11th Cir. Sept. 19, 2024).[1] As the Eleventh Circuit noted, the court has recently been trying “to clear a path” regarding Title VII claims, providing clearer guidance for practitioners and litigants.[2] In McCreight, the court sought to “clear up two other strands of [its] case law: sex-plus claims and mixed-motive theories of liability.”[3] This blog post will discuss the McCreight opinion and discuss its implications moving forward.

As noted by the court, “[a] sex-plus claim is based on one kind of discrimination—sex discrimination—targeting one subclass of a sex.  Black women and mothers are subcategories of women that have been recognized.  So too for older women,” the category at issue in McCreight.[4] Regarding the mixed-motive theory of liability, the court stated that it allows for “liability when an employment decision motivated by a legitimate reason—usually poor work performance—is also infected by an illegitimate reason—illegal discrimination.”[5] The court noted that “because mixed-motive discrimination is a theory of liability, not a type of claim, it need not be alleged in the complaint to survive; raising a mixed-motive argument by summary judgment offers notice to defendants about what to defend, and to courts about what to decide.”[6]

Turning to the case at issue, the Eleventh Circuit affirmed the summary judgment granted by the district court in favor of the defendants, holding that the plaintiffs did not produce enough evidence for a reasonable jury to find in their favor.[7] The facts of the case are not relevant for purposes of this blog post—suffice it to say that the plaintiffs argued that their terminations violated Title VII and the Age Discrimination in Employment Act and related state statutes.[8] The court began by examining the sex-plus claim and providing clarification regarding the mixed-motive theory of liability, as McCreight had conflated the two concepts.[9] The court noted that “[i]n short, sex-plus-age is a type of employment discrimination claim a plaintiff can bring, and mixed-motive is a theory of causation that a plaintiff can rely on to support that claim.”[10] The court held that although the McCreight was correct that a mixed-motive theory did not need to be alleged in the complaint to survive, she had not raised the theory at all at the district court level, thus waiving that claim.[11]

Regarding the sex-plus-age claim, the court noted that “[i]n a sex-plus-age case, the basis for the alleged discrimination is sex; the age factor’s work is in defining the subgroup in which the alleged sex discrimination occurred.”[12]  Thus, such claims fall within Title VII.[13]  As stated by the court, “[s]ingling out only one subgroup of a sex for discriminatory treatment thus does not insulate an employer from liability.”[14] A plaintiff can support such a claim (or any other discrimination claim) “through either a single- or mixed-motive theory[.]”[15]

When raising a mixed-motive theory of liability, “the employee contends that both legal and illegal reasons motivated her firing.”[16] Under the mixed-motive theory, “a plaintiff need only show that an illegal reason played a party in the decision—not that it had a dispositive role.”[17] Regarding remedies under a mixed-motive theory, the court notes that “if a plaintiff prevails under a mixed-motive theory, an employer can still avoid damages and certain equitable relief by showing that it would have taken the same action even without the illegal motivation. . . . This affirmative defense is known as the mixed-motive or same-decision defense.”[18] As the court explained, a plaintiff is not required to plead the motive at the outset of the case, as often discovery is needed to determine “which causation standard to pursue.”[19] According to the court, “[s]o long as the factual basis is properly alleged, an employee can raise a mixed-motive theory of liability as late as summary judgment. What is important is not when the theory is raised, but whether the defendant has enough notice of it.”[20] The court emphasized that plaintiffs cannot “spring new theories of liability that were not considered or defended against at summary judgment” on appeal, as McCreight had attempted in the case at issue.[21]

Applying the sex-plus and mixed-motive analyses to the case before it, the court rejected the claims made by the plaintiffs. As noted above, the court held that McCreight did not raise the mixed-motive theory in the district court, thus waiving that claim.[22] The court stressed that the mixed-motive theory does not invoke “a diminished standard of proof,” as seemingly argued by McCreight.[23] In reviewing the facts, the court determined that neither McCreight nor Wester offered enough evidence to have a reasonable jury find in their favor. As the court concluded, “[o]ur employment discrimination caselaw provides many approaches for plaintiffs seeking relief from discrimination. But all roads lead to Rule 56 (the summary judgment rule)—so long as a plaintiff offers enough evidence for a reasonable jury to infer illegal discrimination, her Title VII claim will survive summary judgment.”[24] In McCreight, the appellants failed to meet this burden, and the court affirmed the granting of summary judgment in favor of the defendants below.[25]

Navigating a discrimination case is a difficult journey and requires competent legal counsel. Our firm has extensive experience in all workplace matters. If you have any questions or concerns regarding this topic, or any topic related to labor and employment law, please contact us.

[1] The opinion can be found at https://media.ca11.uscourts.gov/opinions/pub/files/202212577.pdf (last visited Oct. 24, 2024).

[2] McCreight, at *2.

[3] Id.

[4] Id.

[5] Id., at *3.

[6] Id.

[7] Id.

[8] Id., at *7.

[9] Id., at *9.

[10] Id.

[11] Id., at *9-10.

[12] Id., at *11.

[13] Id., at *12.

[14] Id., at *10.

[15] Id., at *12.

[16] Id. (citation omitted).

[17] Id., at *12-13.

[18] Id., at *13.

[19] Id., at *14.

[20] Id., at *15.

[21] Id., at *16.

[22] Id., at *17.

[23] Id., at *18.

[24] Id., at *34.

[25] Id.

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On August 26, 2024, the Eleventh Circuit Court of Appeals[1] rendered its opinion in U.S. ex rel. Jacobs v. JP Morgan Chase Bank, N.A., No. 22-10963 (11th Cir. Aug. 26, 2024).[2] The Court addressed the False Claims Act’s (“FCA”)[3] public disclosure bar, which provides “that a ‘court shall dismiss an [FCA] action or claim . . . if substantially the same allegations . . . as alleged in the action or claim were publicly disclosed . . . from the news media.’”[4] As the Eleventh Circuit noted, “[t]his prohibition does not apply if ‘the action is brought by the Attorney General or the person bringing the action is an original source of the information.’”[5]

As explained by the Eleventh Circuit, the district court dismissed the Relator’s FCA action for two reasons: (1) “it concluded that his amended complaint did not plead fraud with particularity as required by Federal Rule of Civil Procedure 9(b); and (2) “it concluded that the gravamen (or essence) of his fraud claims had already been disclosed on three blogs and that he was not an original source of that information.”[6] On appeal, the Eleventh Circuit focused only on the public disclosure bar.[7]

By way of background, the case was filed by a Florida foreclosure attorney alleging that JP Morgan Chase forged mortgage loan promissory notes and submitted false reimbursement claims to Fannie Mae and Freddie Mac (government-sponsored enterprises) for loan servicing costs.[8] JP Morgan Chase acquired the promissory notes from Washington Mutual upon its collapse in 2008.[9] According to the Relator, “Washington Mutual forgot to endorse every loan it originated, a violation of federal guidelines, which is discovered would have required it [and JP Morgan Chase] to repurchase the mortgages from Fannie and Freddie or to remit make-whole payments.”[10] Relator alleged that JP Morgan Chase developed a scheme to forge endorsements on millions of loans using a former Washington Mutual employees’ signature stamps.[11] Relator further alleged that despite its knowing and willful noncompliance with the pertinent federal guidelines, JP Morgan Chase submitted payments claims totaling hundreds of millions of dollars for loan servicing costs.[12] He further claimed that JP Morgan Chase covered up the scheme by committing perjury and coaching witnesses.[13]

In February 2020, the Relator filed suit.[14] The district court dismissed the claim for failure to meet the heightened fraud pleading standard found in Federal Rule of Civil Procedure 9(b).[15] The court further noted that the Relator needed to plead that he was “an original source of the allegations under the FCA’s public disclosure bar[.]”[16] Relator then filed an amended complaint, which was also dismissed by the district court.[17] On the public disclosure issue, the district court “concluded that the FCA’s public disclosure provision independently bars Jacobs’s lawsuit because online blog articles from before the lawsuit allege that employees would use [former Washington Mutual employees’] rubber stamps to fraudulently endorse the loan promissory notes.”[18] The district court took judicial notice (i.e., declared a fact presented as evidence as true without a formal presentation) of three blog posts.[19] All three posts mentioned JP Morgan’s alleged fraudulent scheme and disclosed details regarding one of the former Washington Mutual employees.[20]   One of the blog posts was created in January 2014, six years prior to Relator’s filing of the complaint.[21] Based on these blog posts, the district court determined that “substantially the same information as the allegations in the complaint had been publicly disclosed in the news media before Jacobs’s lawsuit and concluded that Jacobs wasn’t an original source of the information, requiring dismissal under the FCA’s public disclosure bar.”[22]

In affirming the district court, the Eleventh Circuit examined the purpose of the FCA’s public disclosure bar.[23] As the court noted, “[w]ithout this public disclosure bar, ‘opportunistic relators—with nothing new to contribute—could exploit the FCA’s qui tam provisions for their personal benefit.’”[24] The Eleventh Circuit asserted that there is a three-part test to determine if the public disclosure bar applies.[25] First, the court examines whether the allegations had been publicly disclosed.[26] If the answer is “yes,” the court will ask whether “‘the allegations in the complaint are “substantially the same” as . . . allegations or transactions contained in public disclosures.’”[27] If the answer to that question is also “yes,” the court will ask if the relator is “‘an “original source” of that information.’”[28]

As to the first question, the court initially easily determined that the blog posts were disclosed prior to the suit.[29] The court further held that the blog posts constituted “news media” under the FCA.[30] As the court had concluded in Osheroff, “‘publicly available websites . . . intended to disseminate information’ are ‘news media’ under the FCA.”[31] The court rejected the Relator’s argument that the blog posts were not news media because they were individually-run blogs.[32] According to the Eleventh Circuit, “[t]hese blogs—no matter their precise size or sweep—are publicly available websites that bill themselves as disseminating foreclosure-related and mortgage-related information to the public.”[33] According to the court, “[b]ecause there is nothing private or personal about these blogs, we need not address whether the term ‘news media’ under the FCA covers a private or personal social media page.”[34]

Regarding the second part of the analysis, the court held that Relator’s allegations were substantially the same as the allegations contained in the blog posts.[35] The court noted that although the blog posts were not exactly the same as Relator’s allegations, they were substantially similar.[36] The court concluded its analysis of this issue by asserting, “[o]ur case law requires significant overlap, not that a mirror image of the complaint’s allegations had been publicly disclosed.”[37]

As to the final inquiry, the court rejected the Relator’s argument that he was the original source of the information “because his law practice gave him independent knowledge of JP Morgan Chase’s fraud.”[38] The court held that the Relator’s “litigation against JP Morgan Chase has not provided him with independent information to corroborate his stamping scheme theory or his allegation that JP Morgan Chase submitted false claims to the government.”[39] The court further determined that the allegations in the amended complaint did not materially add to the claims made in the blog posts.[40] Thus, the court concluded that “[t]he blog articles publicly disclosed in the news media substantially the same allegations as those in Jacobs’s lawsuit before he filed it, and he is not an original source of the information.”[41] Therefore, the district court properly dismissed the action.[42]

The Jacobs case highlights some of the intricacies of FCA claims. Such causes of action are highly complicated, and it is important to seek counsel if you feel you have such a claim.  If you have any questions or concerns regarding this topic, or any topic related to labor and employment law, please contact us.

[1] As noted in previous blog posts, Florida is in the Eleventh Circuit.

[2] The opinion is available at https://media.ca11.uscourts.gov/opinions/pub/files/202210963.pdf (last visited Oct. 24, 2024).

[3] For an overview of the False Claims Act, please review our previous blog post: https://www.schwartzlawfirm.net/dont-cross-uncle-sam-a-brief-overview-of-the-false-claims-act/ (last visited Oct. 24, 2024).

[4] U.S. ex rel. Jacobs, at *2 (quoting 31 U.S.C. § 3730(e)(4)(A)).

[5] Id. (quoting 31 U.S.C. § 3730(e)(4)(A)).

[6] Id.

[7] Id., at *2-3.

[8] Id., at *3.

[9] Id.

[10] Id.

[11] Id., at *3-4.

[12] Id., at *4.

[13] Id.

[14] Id.

[15] Id.

[16] Id.

[17] Id., at *4-5.

[18] Id., at *5.

[19] Id.

[20] Id.

[21] Id.

[22] Id., at *6.

[23] Id., at *7.

[24] Id. (quoting U.S. ex rel. Bibby v. Mortg. Invs. Corp., 987 F.3d 1340, 1353 (11th Cir. 2021) (other citation omitted)).

[25] Id., at *8.

[26] Id.

[27] Id. (quoting U.S. ex rel. Osheroff v. Humana, Inc., 776 F.3d 805, 812 (11th Cir. 2015) (other citation omitted)).

[28] Id., at *9 (quoting Osheroff, 776 F.3d at 812 (other citation omitted)).

[29] Id.

[30] Id.

[31] Id., at *10 (quoting Osheroff, 776 F.3d at 813).

[32] Id., at *10-11.

[33] Id., at *11.

[34] Id.

[35] Id., at *12.

[36] Id., at *13.

[37] Id., at *13-14.

[38] Id., at *14.

[39] Id., at *15.

[40] Id.

[41] Id., at *16.

[42] Id.

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On August 20, 2024, the United States District Court for the Northern District of Texas (Dallas Division) rendered its opinion in Ryan LLC v. Federal Trade Commission, No. 3:24-CV-00986-E (N.D. Tx. Aug. 20, 2024).[1]  By way of background, non-compete “agreements are restrictive covenants that prohibit an employee from competing against the employer.”[2] According to the FTC, approximately 30 million workers in the United States are subject to a non-compete agreement.[3] Historically, states (including Florida) have “regulated non-competes through caselaw and statute.”[4] There is no federal law regarding the enforceability of non-compete agreements.[5] On January 19, 2023, after conducting a study of non-compete agreements, “the FTC proposed the Non-Compete Rule—which would ‘prohibit employers from entering into non-compete clauses with workers starting on the rule’s compliance date’ and ‘require employers to rescind existing non-compete clauses no later than the rule’s compliance date.’”[6] The FTC adopted the final version of the rule on April 23, 2024, with a scheduled effective date of September 4, 2024.[7]

Ryan LLC initiated the lawsuit on April 23 challenging the Non-Compete Rule.[8] Ryan asserted that “the FTC’s actions were unlawful because (i) the FTC acted without statutory authority; (ii) the Rule is the product of an unconstitutional exercise of power; and (iii) the FTC’s acts, findings, and conclusions were arbitrary and capricious.”[9] Ryan sought an order staying the effective date of the Non-Compete Rule and sought to enjoin the FTC from enforcing the rule.[10] On July 3, 2024, the court granted the motion and stayed the effective date.[11] The opinion at issue addressed the subsequent motions for summary judgment filed by the parties.[12]

In granting the plaintiffs’ motion for summary judgment and setting aside the FTC’s non-compete rule, the court first examined whether the FTC had the statutory authority to implement the rule.[13] The court carefully examined the pertinent statutory framework and determined that the FTC exceeded its statutory authority.[14]  The court noted that the pertinent statutory provision lacked a penalty provision, demonstrating that it “encompasses only housekeeping rules—not substantive rulemaking power.”[15]  In reviewing the historical context of the Federal Trade Commission Act of 1914 (“FTC Act”) and subsequent amendments, the court observed that “for the first forty-eight years of its existence, the [FTC] explicitly disclaimed substantive rulemaking authority.”[16] It was not until 1962 that the FTC relied upon a provision in the FTC Act to issue regulations related to trade.[17] Subsequently, the FTC issued several rules after the 1962 rule was upheld by the D.C. Circuit Court, but the agency did not promulgate a single substantive rule under the pertinent statutory provision between 1978 and the non-compete rule.[18] The court concluded its statutory analysis by stating, “the Court concludes the text and the structure of the FTC Act reveal the FTC lacks substantive rulemaking authority with respect to unfair methods of competition, under [the pertinent statutory provision].”[19]

The court further determined that the non-compete rule was “arbitrary and capricious.”[20] As the Supreme Court has explained, “‘[t]he [Administrative Procedure Act’s] arbitrary-and-capricious standard requires that agency action be reasonable and reasonably explained.  . . . A court simply ensures that the agency has acted within a zone of reasonableness and, in particular, has reasonably considered the relevant issues and reasonably explained the decision.’”[21] Generally, a court will find an agency rule to be arbitrary and capricious if:

“[T]he agency has relied on factors which Congress has not intended it to consider, entirely failed to consider an important aspect of the problem, offered an explanation for its decision that runs counter to the evidence before the agency, or is so implausible that it could not be ascribed to a difference in view or the product of agency expertise.”[22]

The court determined that the non-compete rule was arbitrary and capricious “because it is unreasonably overbroad without a reasonable explanation.”[23] The court further held that “[t]he Rule imposes a one-size-fits-all approach with no end date, which fails to establish a ‘rational connection between the facts found and the choice made.’”[24] The court noted that in developing the rule, the FTC relied on a handful of studies and emphasized that no state has adopted a non-compete rule as broad as the FTC’s.[25] According to the court, “the Rule is based on inconsistent and flawed empirical evidence, fails to consider the positive benefits of non-compete agreements, and disregards the substantial body of evidence supporting those agreements.”[26]

In further support of its opinion, the court also noted that the FTC did not “sufficiently address alternatives to issuing the Rule.”[27] The FTC maintained that it did not need to address alternatives because “‘case-by-case adjudication of the enforceability of non-competes has an in terrorem [i.e., warning] effect that would significantly undermine the Commission’s objective to address non-competes’ tendency to negatively affect competitive conditions in a final rule.’”[28] The court rejected the FTC’s justification and its conclusory dismissal of other alternatives.[29]

After concluding its analysis, the court reiterated that it was holding that the non-compete rule was not authorized under the pertinent statutory provisions and that the rule is arbitrary and capricious.[30] The court granted summary judgment in favor of the plaintiffs and set aside the rule, thus preventing it from taking effect on September 4.[31] As of this writing, the FTC has not announced if it will appeal the decision.

The laws regarding non-compete agreements vary by state. It is important to seek legal counsel when either drafting such agreements or trying to determine if such an agreement is valid.  If you have any questions or concerns regarding this topic, or any topic related to labor and employment law, please contact us.

[1] The opinion is available at https://www.uschamber.com/assets/documents/Order-Granting-SJ-Setting-Aside-Rule-Ryan-v.-FTC-N.D.-Tex.pdf (last visited Sept. 25, 2024).

[2] Ryan LLC v. Fed. Trade Comm’n, No. 3:24-CV-00986-E (N.D. Tx. Aug. 20, 2024), at *4.

[3] Id.

[4] Id., at *5.  See § 542.335, Fla. Stat. (2024), for Florida’s non-compete statute.

[5] Ryan LLC, at *5.

[6] Id.

[7] Id., at *2, 5.

[8] Id., at *7.

[9] Id., at *7-8.

[10] Id., at *8.

[11] Id.

[12] Id., at *8-9.

[13] Id., at *14.

[14] Id., at *17-22.

[15] Id., at *18.

[16] Id., at *19.

[17] Id.

[18] Id., at *20.

[19] Id., at *22.

[20] Id.

[21] Id., at *22-23 (quoting FCC v. Prometheus Radio Project, 592 U.S. 414, 423 (2021)).

[22] Id., at *23 (quoting Motor Vehicle Mfrs. Ass’n of U.S., Inc. v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983)).

[23] Id., at *23-24.

[24] Id., at *24 (quoting State Farm Mut. Auto. Ins. Co., 464 U.S. at 43 (other citation omitted)).

[25] Id.

[26] Id.

[27] Id., at *25.

[28] Id.

[29] Id.

[30] Id., at *26.

[31] Id., at *26-27.

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On January 19, 2024, the Florida Bar (“the Bar”), backed by a unanimous endorsement by the Bar’s Board of Governors, issued an ethics opinion (Opinion 24-1) related to the topic of artificial intelligence (“AI”).[1] With the rise in popularity of ChatGPT and similar products, it is necessary for the legal community to take note and adapt to the changing landscape of the practice of law. The Bar began the advisory opinion by noting, “Lawyers may use generative artificial intelligence (‘AI’) in the practice of law, but must protect the confidentiality of client information, provide accurate and competent services, avoid improper billing practices, and comply with applicable restrictions on lawyer advertising.”[2] Regarding maintaining client confidentiality, the Bar asserted that attorneys must research “the program’s policies on data retention, data sharing, and self-learning.”[3] The Bar stressed that lawyers are responsible for their work product and must “develop policies and practices to verify that the use of generative AI is consistent with the lawyer’s ethical obligations.”[4] For example, the Bar shared the story of a federal judge in New York sanctioning “two unwary lawyers and their law firm following their use of false citations created by generative AI.”[5] The Bar noted that lawyers must not engage in improper billing practices due to the use of AI, including double billing.[6] The Bar further advised that chatbots “must comply with restrictions on lawyer advertising and must include a disclaimer indicating that the chatbot is an AI program and not a lawyer or employee of the law firm.”[7]  The Bar encouraged lawyers to “educate themselves regarding the risks and benefits of new technology.”[8]

Regarding confidentiality, the Bar stressed that it is recommended that attorneys “obtain the affected client’s informed consent prior to utilizing a third-party generative AI program if the utilization would involve the disclosure of any confidential information.”[9] The Bar went on to warn about “‘self-learning’” AI, and the potential for a client’s information to be revealed to third parties in response to future inquiries.[10] The Bar stated that ethics opinions related to other matters, including cloud computing and overseas paralegals, provide guidance to attorneys when using third-party generative AI programs.[11] The Bar’s focus is very much the protection of client confidentiality.[12] The Bar did note that “[i]f the use of a generative AI program does not involve the disclosure of confidential information to a third-party, a lawyer is not required to obtain a client’s informed consent pursuant to Rule 4-1.6.”[13]

Regarding oversight of generative AI, the Bar looked to Rule 4-5.3(a) and related ethics opinions regarding nonlawyer assistants.[14] As an initial matter, attorneys must ensure that the conduct of the AI program “is compatible with the lawyer’s own professional obligations[.]”[15] As noted above, a lawyer must also review the work done by the AI program, as they are responsible for the work product.[16] If a lawyer fails to verify the accuracy of the work product, he or she may be subject to discipline.[17] The Bar cautioned attorneys that “a lawyer should be wary of utilizing an overly welcoming generative AI chatbot that may provide legal advice, fail to immediately identify itself as a chatbot, or fail to include clear and reasonably understandable disclaimers limiting the lawyer’s obligations.”[18]

Regarding fees and costs, the Ethics Opinion made it clear that “a lawyer may not ethically engage in any billing practices that duplicate charges or that falsely inflate the lawyer’s billable hours.”[19] If an attorney wishes to charge a client for the use of generative AI, the applicable “standards require a lawyer to inform a client, preferably in writing, of the lawyer’s intent to charge a client the actual cost of using generative AI.”[20] If an attorney cannot determine the cost for a particular client, the charges should be accounted for as overhead and not prorated to the client.[21] The Bar closed the section on fees and costs by noting, “while a lawyer may charge a client for the reasonable time spent for case-specific research and drafting when using generative AI, the lawyer should be careful not to charge for the time spent developing minimal competence in the use of generative AI.”[22]

Finally, regarding advertising, the Bar again cautioned lawyers that they are responsible for the information provided by an AI chatbot.[23] It is imperative that attorneys who use chatbots on their websites make it clear that the prospective client is speaking to a chatbot.[24] Finally, the Bar noted, “Lawyers may advertise their use of generative AI but cannot claim their generative AI is superior to those used by other lawyers or law firms unless the lawyer’s claims are objectively verifiable.”[25] Thus, unless an attorney is utilizing Deep Thought from The Hitchhiker’s Guide to the Galaxy that can provide the answer to life, the universe, and everything, it is unlikely that an attorney will be able to make such a claim.[26]

As AI evolves and becomes more common throughout the legal field, it is important for lawyers and clients alike to understand the limits of the technology and the rules adopted by the Bar and courts related to its use. In closing its ethics opinion, the Bar noted, “lawyers should continue to develop competency in their use of new technologies and the risks and benefits inherent in those technologies.”[27]

If you have any questions or concerns regarding this topic, or any topic related to labor and employment law, please contact us.[28]

[1] The Ethics Opinion can be found at https://www.floridabar.org/etopinions/opinion-24-1/ (last visited Aug. 6, 2024).

[2] Id., at *1.

[3] Id.

[4] Id.

[5] Id., at *2. For more information, see Mata v. Avianca, 22-cv-1461, 2023 WL 4114965, at *17 (S.D.N.Y. June 22, 2023).

[6] Id., at *1.

[7] Id.

[8] Id.

[9] Id., at *2.

[10] Id.

[11] Id., at *3.

[12] Id.

[13] Id., at *3-4.

[14] Id., at *4.

[15] Id.

[16] Id.

[17] Id.

[18] Id., at *5.

[19] Id., at *6.

[20] Id.

[21] Id.

[22] Id.

[23] Id., at *7.

[24] Id.

[25] Id.

[26] Douglas Adams, The Hitchhiker’s Guide to the Galaxy (New York, Harmony Books, 1980).

[27] Fla. Bar Ethics Op. 24-1, at *7.

[28] In case you were wondering, this blog post was written by a human, not AI.

Photo by Igor Omilaev on Unsplash

On June 28, 2024, the United States Supreme Court (“the Court”) rendered its opinion in Loper Bright Enterprises, et al. v. Raimondo, Secretary of Commerce, et al. (“Loper Bright”).[1] In a 6-3 opinion authored by Chief Justice Roberts, the Court changed how courts will approach cases involving the interpretation of statutes by federal agencies. This opinion, although not involving employment law (it involved rules related to fisheries), will have wide-ranging consequences for courts moving forward when examining interpretations from agencies such as the Equal Employment Opportunity Commission (“the EEOC”) and the Department of Labor (“the DOL”).  Before turning to the Court’s analysis, it is important to understand the Chevron doctrine.

In Chevron USA Inc. v. Natural Resources Defense Council, Inc., 476 U.S. 837 (1984) (“Chevron”), the Court rendered an opinion that “sometimes required courts to defer to ‘permissible’ agency interpretations of the statutes those agencies administer—even when a reviewing court reads that statute differently.”[2] The Court established “a two-step framework to interpret statutes administered by federal agencies.”[3] If the preconditions under Chevron were met, the first step was for a court to determine “‘whether Congress has directly spoken to the precise question at issue.’”[4] If congressional intent was clear, that would end the analysis.[5] If not, the second step was for a court to “defer to the agency’s interpretation if it ‘is based on a permissible construction of the statute.’”[6]

In overturning Chevron, the Court first provided a history of Article III of the Constitution, which “assigns to the Federal Judiciary the responsibility and power to adjudicate ‘Cases’ and ‘Controversies’—concrete disputes with consequences for the parties involved.”[7] The Court went on to state, “To ensure the ‘steady, upright and impartial administration of the laws,’ the Framers structured the Constitution to allow judges to exercise that judgment independent of influence from the political branches.”[8]  The Court further noted, “The Court also recognized from the outset, though, that exercising independent judgment often included according due respect to Executive Branch interpretations of federal statutes.”[9] This “respect was thought especially warranted when an Executive Branch interpretation was issued roughly contemporaneously with enactment of the statute and remained consistent over time.”[10] According to the Court, “[w]hatever respect an Executive Branch interpretation was due, a judge ‘certainly would not be bound to adopt the construction given by the head of a department.’”[11]

The Court then turned its attention to a thorough review of case law and legislative history in the decades preceding Chevron. The Court asserted that when there was deferential review of an agency’s action, it was limited to “fact-bound determinations[.]”[12] The Court “did not extend similar deference to agency resolutions of questions of law.”[13] Chief Justice Roberts noted that the Court “was far from consistent in reviewing deferentially even such factbound statutory determinations.”[14] In 1946, Congress enacted the Administrative Procedure Act (“APA”), which “codifies for agency cases the unremarkable, yet elemental proposition reflected by judicial practices dating back to Marbury [v. Madison, 5 U.S. 137 (1803)]: that courts decide legal questions by applying their own judgment.” According to the Court, “Chevron, decided in 1984 by a bare quorum of six Justices, triggered a marked departure from the traditional approach.”[15]

According to Chief Justice Roberts, “Chevron cannot be reconciled with the APA, as the Government and the dissent contend, by presuming that statutory ambiguities are implicit delegations to agencies.”[16] The Court rejected the arguments that agencies should be able to resolve ambiguities because they “have subject matter expertise regarding the statutes they administer; because deferring to agencies purportedly promotes the uniform construction of federal law; and because resolving statutory ambiguities can involve policymaking best left to political actors, rather than courts.”[17] Instead, Chief Justice Roberts asserted that “Congress expects courts to handle technical statutory questions.”[18] Courts routinely rely upon the parties and amici (a party not involved in a matter that submits a brief to the court with its permission) to help inform their decisions.[19] The Court went on to state that “delegating ultimate interpretive authority to agencies is simply not necessary to ensure that the resolution of statutory ambiguities is well informed by subject matter expertise. The better presumption is therefore that Congress expects courts to do their ordinary job of interpreting statutes, with due respect for the views of the Executive Branch.”[20] The Court further determined that stare decisis, which governs judicial adherence to precedent, did not bind the Court to continue to follow Chevron.[21] Chief Justice Roberts noted, “Its [i.e., Chevron] flaws were nonetheless apparent from the start, prompting this Court to revise its foundations and continually limit its application.”[22] The Court went on to state, after reviewing the decreasing reliance on Chevron over the past few decades, that “[a]t this point, all that remains of Chevron is a decaying husk with bold pretensions.”[23]

The Court thus overturned Chevron and determined, “Courts must exercise their independent judgements in deciding whether an agency has acted within its statutory authority, as the APA requires. Careful attention to the judgment of the Executive Branch may help inform the inquiry.”[24] The Court concluded by stating, “And when a particular statute delegates authority to an agency consistent with constitutional limits, courts must respect the delegation, while ensuring that the agency acts within it. But courts need not and under the APA may not defer to an agency interpretation of the law simply because a statute is ambiguous.”[25]

Although Loper Bright did not involve employment law, its ramifications will be felt across all federal agencies.  Regulations and rules promulgated by the EEOC, the DOL, and other employment-related agencies will come under a new form of scrutiny when challenged. No longer will the agencies be granted deference under Chevron. Instead, courts must conduct a thorough and independent analysis to determine if an agency’s action is legal. Employees and employers will want to monitor the developments as agency regulations and rules face challenges in the future.

If you have any questions or concerns regarding this topic, or any topic related to labor and employment law, please contact us.

[1] The opinion is available at https://www.supremecourt.gov/opinions/23pdf/22-451_7m58.pdf (last visited July 2, 2024).

[2] Loper Bright, at *1.

[3] Id., at *1-2.

[4] Id., at *2 (quoting Chevron).

[5] Id.

[6] Id. (quoting Chevron).

[7] Id., at *7.

[8] Id. (citations omitted).

[9] Id., at *8.

[10] Id. (citations omitted)

[11] Id., at *9 (citation omitted).

[12] Id., at *11.

[13] Id., at *9-10 (emphasis in original).

[14] Id., at *12.

[15] Id., at *18. The decision was 6-0, with Justices Marshall, Rehnquist, and O’Connor taking no part in the consideration or decision of the case.  Justices Marshall and Rehnquist were ill, and Justice O’Connor recused herself due to having a financial interest in one of the parties.  Thomas W. Merrill, The Story of Chevron: The Making of an Accidental Landmark, 66 ADMIN. L. REV. 253, 270-73 (2014), available at https://scholarship.law.columbia.edu/cgi/viewcontent.cgi?article=1461&context=faculty_scholarship (last visited July 2, 2024).

[16] Id., at *21.

[17] Id., at *24.

[18] Id.

[19] Id., at *24-25.

[20] Id., at *25.

[21] Id., at *29.

[22] Id., at *30.

[23] Id., at *33.

[24] Id., at *35.

[25] Id.

Photo by Kyle Glenn on Unsplash

On April 17, 2024, the United States Supreme Court (“the Court”) released its opinion in Muldrow v. City of St. Louis, Missouri, No. 22-193 (Apr. 17, 2024).[1]  In Muldrow, the Court clarified the standard to be used “in addressing Title VII suits arising from job transfers.”[2] This opinion provides important guidance on an issue we often encounter.

As the Court noted, “Sergeant Jatonya Clayborn Muldrow maintains that her employer, the St. Louis Police Department, transferred her from one job to another because she is a woman.”[3]  Sergeant Muldrow brought suit under Title VII alleging she was discriminated against based on her sex.[4]  The lower courts rejected her claim “on the ground that the transfer did not cause Muldrow a ‘significant’ employment disadvantage.”[5]  Other courts previously utilized a similar standard in such Title VII job transfer cases.[6]  The Supreme Court, in a unanimous opinion, held that “[a]lthough an employee must show some harm from a forced transfer to prevail in a Title VII suit, she need not show that the injury satisfies a significance test.  Title VII’s text nowhere establishes that high bar.”[7]

Sergeant Muldrow served as a plainclothes officer in the Intelligence Division from 2008 through 2017.[8]  Against Muldrow’s wishes, she was transferred out of the Intelligence Division.[9]  The new commander wanted to replace Muldrow, whom he sometimes called “‘Mrs.’” instead of the customary “‘Sergeant,’” with a male officer.[10]  Muldrow was reassigned to a uniformed job in another division.[11] Muldrow’s responsibilities, perks, and schedule changed in the new role.[12]  Muldrow also lost her status as an FBI task force officer and the vehicle that came with that title.[13]  Muldrow alleged that the City changed her position because of her sex.[14]  The District Court granted summary judgment in favor of the City, and the Court of Appeals for the Eighth Circuit affirmed.[15]  The Court agreed to review the matter “to resolve a Circuit split over whether an employee challenging a transfer under Title VII must meet a heightened threshold of harm—be it dubbed significant, serious, or something similar.”[16]

In reversing the lower courts, the Court began with the statutory language of Title VII.[17]  The Court noted that the pertinent provision of Title VII “prohibits ‘discriminat[ing] against’ an individual ‘with respect to’ the ‘terms [or] conditions’ of employment because of that individual’s sex.”[18]  Title VII “requires Muldrow to show that the transfer brought about some ‘disadvantageous’ change in an employment term or condition.”[19]  In reviewing the statutory language, the Court determined that “[t]o make out a Title VII discrimination claim, a transferee must show some harm respecting an identifiable term or condition of employment.”[20]  The Court held that Title VII does not require an individual to show a “significant” harm or a similar adjective.[21]  The Court rejected the City’s claims regarding the text of Title VII, precedent, and public policy.[22]  Regarding the latter argument, the Court noted, “Had Congress wanted to limit liability for job transfers to those causing a significant disadvantage, it could have done so.”[23]

The Court concluded by reiterating that “Muldrow need show only some injury respecting her employment terms or conditions.  The transfer must have left her worse off, but need not have left her significantly so.”[24]  The Court thus reversed the decision of the Eighth Circuit and remanded the case for further proceedings.[25]  Already, the Eleventh Circuit (as noted in previous posts, Florida is in the Eleventh Circuit) has acknowledged the impact of Muldrow in a recent unpublished opinion.[26]

If you have any questions or concerns regarding this topic, or any topic related to labor and employment law, please contact us.

[1] The full opinion is available at https://www.supremecourt.gov/opinions/23pdf/22-193_q86b.pdf (last visited June 3, 2024).

[2] Muldrow, at *1.

[3] Id.

[4] Id.

[5] Id.

[6] Id.

[7] Id. (emphasis added).  The Court’s opinion was authored by Justice Kagan.  Justices Thomas, Alito, and Kavanaugh filed separate opinions concurring in the judgment of the Court.

[8] Id.

[9] Id., at *2.

[10] Id.

[11] Id.

[12] Id.

[13] Id.

[14] Id., at *3.

[15] Id., at *3-4.

[16] Id., at *4.

[17] Id., at *5.

[18] Id.

[19] Id. (citation omitted).

[20] Id., at *6.

[21] Id.

[22] Id., at *8.

[23] Id., at *10.

[24] Id.

[25] Id., at *11.

[26] Regina Bennett v. Butler Co. Bd. of Ed., et al., Case No. 23-10186 (11th Cir. May 24, 2024), available at https://media.ca11.uscourts.gov/opinions/unpub/files/202310186.pdf (last visited June 3, 2024).

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The Headline

On April 23, 2024, the Federal Trade Commission (FTC) announced that it had finalized a new rule that, once implemented, will prohibit employers from enforcing noncompete clauses.

When does the new rule become effective?

The new rule will become effective one hundred twenty (120) days after the publication date of the new rule (which has not yet occurred).

What is the definition of “noncompete clauses” under the new rule?

A non-compete clause means any term or condition of employment that prohibits or prevents a worker from, or penalizes a worker for:

1. seeking or accepting work with a different employer in the United States after separating from the current employer; or
2. operating a business in the United States after separating from the current employer.

What, specifically, does this new rule prohibit?

Under the new rule, employers will be prohibited from:

1. enforcing existing noncompete clauses, except with respect to senior executives (defined as individuals earning at least $151,164 annually and are in a “policy-making” position); and
2. entering into new noncompete agreements with employees.

What does the rule NOT prohibit?

Employers are not prohibited under the new rule from:

1. entering into and enforcing non-solicitation agreements and non-disclosure agreements, provided that they do not meet the definition of “noncompete clause.”
2. entering into and enforcing noncompete clauses in connection with the sale of a business.
3. continuing to litigate noncompete enforcement actions that accrued before the effective date of the new rule.

What obligations does the new rule create for employers?

Employers will be required to inform employees who have signed noncompete clauses that those clauses are no longer in effect and will not be enforced.

What else should employers be doing?

As the effective date approaches, employers should review existing agreements or form agreements they regularly utilize, and eliminate noncompete clauses.  Once again, the new rule does not prohibit clauses that prevent solicitation of clients or customers, nor does it probit non-disclosure provisions that protect confidential information or trade secrets.  Employers may continue utilizing these narrower restrictive covenants.

Can the FTC really do this?

That is a good question that many are asking.  Undoubtedly, legal challenges to the FTC’s authority to implement this rule have already been initiated by several business groups, and those challenges will likely reach the United States Supreme Court.  We will monitor these challenges and provide updates as they become available.

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Every now and then, we will have a company (or an employee) contact us and tell us that an employee has been involved in a car accident while performing duties for the company. The question we of course are asked is, “Are we on the hook for this?” The answer is possibly, under the theory of vicarious liability. Recently, Florida’s Fifth District Court of Appeal (“Fifth DCA”) addressed this issue and provided guidance on when an employer can be held liable in such circumstances.

In Kulzer v. Way & Greenleaf Trust, No. 5D23-0750 (Fla. 5th DCA Feb. 2, 2024), an employee of Greenleaf Trust got into a car accident while “running errands she said were related to her employment duties of inspecting and readying a condominium unit and its contents for sale.”[1] According to the record, “[a]fter completing two errands, Ms. Way grabbed a hamburger which she ate in the parking lot of McDonald’s. She was then heading back to the condominium for a business meeting when she negligently collided her car into the car driven by Appellant, Carol Ann Kulzer[.]”[2] Ms. Kulzer filed suit, claiming injuries and damages in her suit against Ms. Way and Greenleaf.[3] The trial court granted summary judgment in favor of Greenleaf, absolving it of any liability for Ms. Way’s negligence.[4] The trial court held that Ms. Way “was not within the course and scope of her employment at the time of the wreck based upon application of the coming and going rule.”[5] Ms. Kulzer appealed.[6]

The Fifth DCA began its analysis with an overview of the pertinent facts. Ms. Way ordinarily worked for Greenleaf in Kalamazoo, Michigan, but she was temporarily assigned to Ormond Beach, Florida.[7] On the day in question, “she traveled to the condominium in the morning, left the premises around noon, and was scheduled to attend a 2:00 p.m. work-related meeting at the condo.”[8] Around noon, Ms. Way traveled from the condo to a store where she purchased packing supplies; there was no dispute that this errand was within the course and scope of her employment.[9] Next, Ms. Way drove to an ABC Fine Wine & Spirits to purchase wine and hors d’oeuvres.[10] She next stopped at McDonald’s for lunch.[11] As she was driving back to the condo, Ms. Way crashed into Ms. Kulzer’s vehicle.[12] Ms. Way admitted fault for the accident, but Greenleaf denied that it was vicariously liable for her conduct, “claiming that Ms. Way was not within the course and scope of her employment at the time of the wreck.”[13]

As the Fifth DCA asserted, “[a]n employer is vicariously liable for the tortious conduct of its employee only if committed within the scope of employment.”[14] The court noted that the Third District Court set forth a widely accepted test of whether an employee, while driving, was within the scope of employment in the case Sussman v. Florida East Coast Properties, Inc., 557 So. 2d 74 (Fla. 3d DCA 1990).[15] There, the Third District Court stated that employer liability arises:

only if (1) the conduct is of the kind the employee is hired to perform, (2) the conduct occurs substantially within the time and space limits authorized or required by the work to be performed, and (3) the conduct is activated at least in part by a purpose to serve the master.[16]

Regarding the “coming and going” rule, the court noted that it applies in “situations where the employee’s wreck occurred as the employee was simply going to the workplace at the beginning of the workday or as she was coming home at the end of the normal workday.”[17] The rule has been codified as part of the workers’ compensation statute (section 440.092) and has been judicially adopted in tort cases.[18] The court noted that here, “the traditional coming and going rule was inapplicable.”[19] The court further noted that “[w]hen an employee is on a single-purpose, personal lunch break, away from the workplace, and not engaged in the employer’s business in any manner, the employee is not considered to be within the course and scope of employment for workers’ compensation purposes.”[20] In a 1935 Florida Supreme Court opinion, the court determined that the jury “should decide whether the employee’s lunch detour was merely a slight departure from work or an abandonment of the employer’s business, with vicarious liability attaching only for the former circumstances.”[21] Vicarious liability can be found if an accident occurs after an employee returns to her duties.[22]

In determining that the trial court erred, the Fifth DCA reviewed the factors set forth in Sussman.[23] As to the first factor, “Ms. Way running the errands was self-described as work-related, and at least one of the errands was indisputably conduct of the kind the employee was hired to perform.”[24] As to the second factor, “there was no undisputed evidence that the mid-day journey occurred substantially outside the time and space limits authorized or required by the work to be performed.”[25] Finally, as to the third element, the Fifth DCA held that “the evidence was undisputed that Ms. Way’s mid-day journey was motivated at least in part by a purpose to serve her employer, Greenleaf.”[26] Thus, the court reversed the trial court’s granting of summary judgment in favor of Greenleaf and remanded for further proceedings.[27]

It is imperative that employers be aware that there are circumstances where a company will be held liable for the conduct of its employees.  As Kulzer demonstrates, the analysis can be complicated, and it is vital to seek guidance from experienced counsel. If you have any questions or concerns regarding this topic, or any topic related to labor and employment law, please contact us.

[1] Kulzer, at *1-2. The opinion can be found at the following link: https://5dca.flcourts.gov/content/download/1700274/opinion/Opinion_23-0750.pdf (last visited Mar. 1, 2024).

[2] Id., at *2. An appellant is the party who filed an appeal.

[3] Id.

[4] Id.

[5] Id.

[6] Id.

[7] Id.

[8] Id.

[9] Id.

[10] Id.

[11] Id.

[12] Id., at *3.

[13] Id.

[14] Id. (citation omitted).

[15] Id.

[16] Id. (quoting Sussman, 557 So. 2d at 76).

[17] Id.

[18] Id. at *3-4.

[19] Id. at *4.

[20] Id.

[21] Id. (citing W. Union Tel. Co. v. Michel, 163 So. 86, 87-88 (Fla. 1935)).

[22] Id.

[23] Id. at *5.

[24] Id.

[25] Id.

[26] Id.

[27] Id.

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On occasion, we will have a client ask whether their company’s CEO will have to testify if the matter proceeds to litigation. Recently, the Fourth District Court of Appeal provided guidance on what is known as the “apex doctrine,” which governs depositions of individuals at the highest levels of corporations. This blog post will discuss the court’s opinion in Tesla, Inc. v. Monserratt, No. 4D2023-2075 (Fla. 4^th DCA Jan. 3, 2024), and discuss its implications for cases moving forward.[1]

The facts of Monserrat are tragic. The case involved a 2018 accident where an 18-year-old crashed his Tesla Model S while driving 116 miles per hour.[2] The driver and his passenger died in the crash.[3] Subsequently, the father of the passenger sued Tesla for negligence, alleging that “a Tesla service technician deactivated the 85-mph top speed limiting software previously enabled on the vehicle” at the driver’s behest.[4] Following the crash and ensuing media coverage, Elon Musk, CEO of Tesla, called the driver’s father to extend his condolences.[5] According to the father, during the course of the conversation Mr. Musk “‘said something to the effect of, perhaps we should not have removed the limiter. We will have to review and revise our policies.’”[6] Mr. Musk and the father also exchanged e-mails where “Mr. Musk conveyed information learned in Tesla’s initial investigation of the crash.”[7]

Subsequently, the plaintiff sought to depose Mr. Musk regarding the conversation with the driver’s father.[8] Tesla asserted that Mr. Musk was entitled to protection under Florida Rule of Civil Procedure 1.280(c) and (h).[9] In a declaration filed by Tesla, Mr. Musk described his executive role in the company and other companies and “stated that it would place a substantial burden and hardship on him if he were to be deposed.”[10] Mr. Musk also asserted, under penalty of perjury, that “he had no independent recollection of the phone call beyond what was in the e-mail communications and his extension of condolences.”[11] Tesla did produce the e-mails between Mr. Musk and the father of the driver.[12] The presiding judge granted Tesla’s motion for protective order (blocking the deposition of Mr. Musk), “finding that the call was sympathy call and that Mr. Musk did not possess unique, personal knowledge.”[13]

After the case was transferred to another judge as part of a routine administrative transfer process, Plaintiff again sought to depose Mr. Musk.[14] In lieu of the deposition, Tesla agreed to have Mr. Musk respond to requests for admissions and interrogatories about the phone call.[15] Mr. Musk reiterated that he did not recall discussing the matters claimed by the father, besides extending his condolences.[16] After receiving the answers, Plaintiff again sought to compel the deposition of Mr. Musk.[17] The new trial judge granted the request, reasoning “‘apparently there allegedly is a dispute as to what was said by Mr. Musk via-à-vis (sic) his conversation with [the father].’”[18] Tesla timely sought review of that determination by filing a petition for writ of certiorari.[19]

The Fourth District Court addressed “the merits of the petition—whether the trial court departed from the essential requirements of the law when it granted Plaintiff’s motion to compel the deposition of Mr. Musk.”[20] In reaching its decision that the trial court did err, the court began by setting forth the text of rule 1.280(h), Florida Rules of Civil Procedure, as adopted in 2021.[21] That rule provides:

Apex Doctrine. A current or former high-level government or corporate officer may seek an order preventing the officer from being subject to a deposition. The motion, whether by a party or by the person of whom the deposition is sought, must be accompanied by an affidavit or declaration of the officer explaining that the officer lacks unique, personal knowledge of the issues being litigated. If the officer meets this burden of production, the court shall issue an order preventing the deposition, unless the party seeking the deposition demonstrates that it has exhausted other discovery, that such discovery is inadequate, and that the officer has unique, personal knowledge of discoverable information.

The court may vacate or modify the order if, after additional discovery, the party seeking the deposition can meet its burden of persuasion under this rule. The burden to persuade the court that the officer is high-level for purposes of this rule lies with the person or party opposing the deposition.[22]

The Fourth District Court noted that in deciding whether the trial court erred, “the first inquiry is whether Tesla met its two-fold burden of (1) demonstrating that Mr. Musk met the high-level officer requirement, and (2) producing an affidavit or declaration explaining Mr. Musk’s lack of unique, personal knowledge of the issues being litigated.”[23]

The court held that the Plaintiff did not demonstrate that the existing discovery was inadequate or that Mr. Musk possessed unique, personal knowledge.[24] The court noted that Mr. Musk twice denied making any statements during the call regarding the limiter.[25] The court determined that “[u]nder these circumstances, requiring Mr. Musk to sit for a deposition would serve no purpose other than to harass and burden Tesla and disrupt Mr. Musk’s ability to meet his obligations to consumers, stockholders, Tesla’s employees, and other activities integral to his position as CEO.”[26] The court therefore granted Tesla’s petition and quashed (i.e., voided) the court’s order compelling Mr. Musk’s deposition.[27]

As the Monserratt opinion demonstrates, Florida courts are now reluctant to subject high-level government or corporate officers to depositions, absent certain circumstances. As two authors have  noted, Florida was the first state to codify the apex doctrine “as a stand-alone rule of civil procedure.”[28] The doctrine is designed to protect high-ranking government officials and corporate officers from harassment and discovery abuses.[29] In determining whether an individual is a high-level officer, courts will look to well-established precedent.[30] It is important to note that the party seeking the deposition of the officer will have the opportunity to demonstrate “that it has exhausted other discovery, that such discovery is inadequate, and that the officer has unique, personal knowledge of the discoverable information.”[31] Reviewing the text of rule 1.280(h) and the pertinent case law is vital in those matters where a party contemplates deposing a high-level government or corporate officer.

If you have any questions or concerns regarding this topic, or any topic related to labor and employment law, please contact us.

[1] The opinion is available on the Fourth District Court of Appeal’s website at the following link: https://4dca.flcourts.gov/content/download/1702694/opinion/Opinion_2023-2075.pdf (last visited Feb. 2, 2024).

[2] Monserratt, at *1.

[3] Id.

[4] Id.

[5] Id., at *2.

[6] Id.

[7] Id.

[8] Id.

[9] Id. Florida Rule of Civil Procedure 1.280(c) involves protective orders in discovery disputes, while 1.280(h) sets forth the apex doctrine. The rules can be found at the following link: https://www-media.floridabar.org/uploads/2023/12/Civil-Procedure-Rules-01-01-24.pdf (last visited Feb. 2, 2024).

[10] Monserratt, at *2.

[11] Id.

[12] Id.

[13] Id.

[14] Id.

[15] Id.

[16] Id.

[17] Id.

[18] Id.

[19] Id.

[20] Id., at *3.

[21] Id.

[22] Id.

[23] Id., at *4.

[24] Id.

[25] Id.

[26] Id.

[27] Id.

[28] Mark A. Behrens & Christopher E. Appel, Florida Supreme Court Leads on Apex Doctrine, American Bar Association (Mar. 9, 2022), available at https://www.americanbar.org/groups/tort_trial_insurance_practice/publications/the_brief/2021-22/winter/florida-supreme-court-leads-apex-doctrine/ (last visited Feb. 2, 2024). According to Behren and Appel, “Florida’s approach provides a clear expression of the doctrine that should serve as a model for other states.” Id.

[29] See id.

[30] Id.

[31] Fla. R. Civ. P. 1.280(h).

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