The Bankruptcy of Refusing to Hire Persons Who Have Filed Bankruptcy

In 1978, Congress made it illegal for government employers to deny employment to, terminate the employment of, or discriminate with respect to employment against a person who has filed bankruptcy. In 1984, Congress extended this prohibition to private employers by making it illegal for such employers to terminate the employment of, or discriminate with respect to employment against a person who has filed bankruptcy. Under the law as it currently exists, private employers can refuse to hire a person who has filed bankruptcy solely because that person has filed for bankruptcy. Meanwhile, employers have substantially increased their use of credit history checks as a pre-employment screening device. Credit history checks will disclose bankruptcy filings, and because blacks and Latinos are overrepresented among bankruptcy filers, these groups are disproportionately affected by bankruptcy discrimination. This disparate impact probably violates Title VII of the Civil Rights Act of 1964. Moreover, there is scant empirical support for the proposition that creditworthiness is a reliable proxy for workplace performance or employee trustworthiness. Relying on bankruptcy status simpliciter is antithetical to a core purpose of the bankruptcy system, which is to give debtors a fresh start. Employers\u27 prerogatives to operate according to whatever employment policies and practices they want should be balanced against employees\u27 and potential employees\u27 right to participate in the labor market in an environment free of irrational discrimination. It is irrational to deny employment to a person who is or was a debtor if the person is otherwise qualified, and the job can be successfully performed regardless of bankruptcy status. To allow such discrimination makes the bankruptcy system\u27s promise of a fresh start illusory

Cause for Concern or Cause for Celebration?: Did Bostock v. Clayton County Establish a New Mixed Motive Theory for Title VII Case and Make It Easier for Plaintiffs to Prove Discrimination Claims?

Title VII of the Civil Rights Act of 1964 makes it unlawful for an employer to discriminate against an employee “because of” race, color, religion, sex, or national origin. This seems simple enough, but if an employer makes an adverse employment decision partly for an impermissible reason and partly for a permissible reason, i.e., if the employer acts with a mixed motive, has the employer acted “because of” the impermissible reason? According to Gross v. FBL Financial Services, Inc. and University of Texas Southwestern Medical Center v. Nassar, the answer is no. The Courts in Gross and Nassar held that proving that an employer acted “because of” an impermissible reason requires proving “but for” causation, which means proving that the employer acted “solely because of” an impermissible reason. A United States Senator who participated in the debates surrounding the enactment of Title VII said, “If anyone ever had an action that was motivated by a single cause, he is a different kind of animal from any I know of.” On June 15, 2020, the Supreme Court decided Bostock v. Clayton County and held that an employer that terminates an employee because the employee is gay or transgender violates Title VII’s prohibition against sex discrimination. But that is not all Bostock did. At several points in the opinion, the Court held a Title VII plaintiff proves her employer acted “because of” an impermissible reason and proves “but for” causation even in cases where the employer acted with a mixed motive, so long as an impermissible reason was one of those motives, and the impermissible reason was decisive. Bostock thus departed from Gross and Nassar in its framing of what “but for” causation means in Title VII cases. This Article posits that Bostock articulated a new mixed motive theory that allows a Title VII plaintiff to prove “but for” causation in cases where the employer acted partly for an impermissible reason and partly for a permissible reason so long as the impermissible reason was decisive. Under this view of Bostock, it is now easier for a plaintiff whose employer acted with a mixed motive to prove “but for” causation and receive the full panoply of Title VII remedies

A Primer on the History and Proper Drafting of Qualified Domestic-Relations Orders

The divorce rate in the United States is slightly more than one-half the marriage rate. Divorce is a fact of life in this country, and will likely be so for the foreseeable future. On August 23, 1984, the divorce lawyer’s job got more complicated when Congress created the Qualified Domestic Relations Order ( QDRO ) as part of some significant amendments to ERISA. QDROs are necessary because before those 1984 ERISA amendments, a lot of divorced persons discovered that they could be deprived of their marital or community property interest in their former spouses\u27 retirement plans. For most divorcing couples, the two largest assets of the marriage are the marital home and retirement accounts. Over ninety-nine million persons participate in private sector retirement plans, and those plans\u27 assets total more than $4 trillion, which exceeds the total value of all residential real estate in the United States. Dividing retirement accounts is not as simple as a court decreeing that each party gets one-half of the other party\u27s account. It takes a properly drafted QDRO to make sure each party gets his or her marital or community property share of the other\u27s retirement benefits. Drafting a QDRO can be time consuming, complex, and frustrating in part because it requires lawyers who primarily practice state law to have a working knowledge of parts of the notoriously lengthy and complex ERISA. A substantial number – perhaps a majority – of QDROs are not prepared properly because they do not reflect the parties\u27 understanding of what they were awarded in the divorce proceeding. In fact, a former administrator for a retirement plan stated that between fifteen and twenty percent of the time, lawyers fail to see a QDRO through to completion. This article will detail the history leading to the creation of QDROs, explain what QDROs are, and offer suggestions on what pitfalls to look for and avoid in drafting them

A Primer on the History and Proper Drafting of Qualified Domestic-Relations Orders

The divorce rate in the United States is slightly more than one-half the marriage rate. Divorce is a fact of life in this country, and will likely be so for the foreseeable future. On August 23, 1984, the divorce lawyer’s job got more complicated when Congress created the Qualified Domestic Relations Order ( QDRO ) as part of some significant amendments to ERISA. QDROs are necessary because before those 1984 ERISA amendments, a lot of divorced persons discovered that they could be deprived of their marital or community property interest in their former spouses\u27 retirement plans. For most divorcing couples, the two largest assets of the marriage are the marital home and retirement accounts. Over ninety-nine million persons participate in private sector retirement plans, and those plans\u27 assets total more than $4 trillion, which exceeds the total value of all residential real estate in the United States. Dividing retirement accounts is not as simple as a court decreeing that each party gets one-half of the other party\u27s account. It takes a properly drafted QDRO to make sure each party gets his or her marital or community property share of the other\u27s retirement benefits. Drafting a QDRO can be time consuming, complex, and frustrating in part because it requires lawyers who primarily practice state law to have a working knowledge of parts of the notoriously lengthy and complex ERISA. A substantial number – perhaps a majority – of QDROs are not prepared properly because they do not reflect the parties\u27 understanding of what they were awarded in the divorce proceeding. In fact, a former administrator for a retirement plan stated that between fifteen and twenty percent of the time, lawyers fail to see a QDRO through to completion. This article will detail the history leading to the creation of QDROs, explain what QDROs are, and offer suggestions on what pitfalls to look for and avoid in drafting them

Third Party Funding of Personal Injury Tort Claims: Keep the Baby and Change the Bathwater

In the early 1990s, a period of high-risk lending at high interest rates, a new entrant emerged in civil litigation: the Litigation Finance Company (“LFC”). LFCs advance money to plaintiffs involved in contingency fee litigation. The money is provided on a non-recourse basis, meaning the plaintiff repays the LFC only if she obtains money from the lawsuit through a settlement, judgment, or verdict. If the plaintiff recovers nothing, she will not owe the LFC anything. When she does repay the LFC, however, she could end up paying as much as 280% of the amount advanced by the LFC. As one can see, LFCs make a lot of money. It is estimated that as of 2011, the total amount of outstanding advances exceeded $1 billion with$100 million being advanced annually. LFCs, like banks and credit card issuers, loan money to consumers with the expectation of being repaid the amount borrowed plus interest. Unlike banks and credit card issuers, however, LFCs are largely unregulated. The federal government does not regulate LFCs at all, and only Maine, Ohio, and Nebraska have enacted legislation regulating LFCs that operate in their respective states. What LFCs do is controversial, and the academic commentary about them is voluminous. Some commentators argue that LFCs should be abolished. Others say LFCs are the byproduct of willing sellers and willing buyers engaging in market transactions. Yet another group of commentators say LFCs serve a salutary purpose, but should be regulated like other entities that loan money to consumers. It is probably unrealistic to think that LFCs will be abolished, thus the question becomes whether they should be regulated, and if so, by whom. This paper posits that LFCs should be regulated by the Consumer Financial Protection Bureau, the Federal Trade Commission, or both. Federal regulation is necessary in order to provide a uniform set of rules that provide protection to consumers while also allowing LFCs the freedom to provide the funding that consumers have shown they are willing to seek and accept

Third Party Funding of Personal Injury Tort Claims: Keep the Baby and Change the Bathwater

In the early 1990s, a period of high-risk lending at high interest rates, a new entrant emerged in civil litigation: the Litigation Finance Company (“LFC”). LFCs advance money to plaintiffs involved in contingency fee litigation. The money is provided on a non-recourse basis, meaning the plaintiff repays the LFC only if she obtains money from the lawsuit through a settlement, judgment, or verdict. If the plaintiff does not recover anything, she will not owe the LFC anything. When she does repay the LFC, however, she could end up paying as much as 280% of the amount advanced by the LFC. As one can see, LFCs make a lot of money. It is estimated that as of 2011, the total amount of outstanding advances exceeded $1 billion with$100 million being advanced annually. LFCs, like banks and credit card issuers, loan money to consumers with the expectation of being repaid the amount borrowed plus interest. Unlike banks and credit card issuers, however, LFCs are largely unregulated. The federal government does not regulate LFCs at all, and only Maine, Ohio, and Nebraska have enacted legislation regulating LFCs that operate in their respective states. What LFCs do is controversial, and the academic commentary about them is voluminous. Some commentators argue that LFCs should be abolished. Others say LFCs are the byproduct of willing sellers and willing buyers engaging in market transactions. Yet another group of commentators say LFCs serve a salutary purpose, but should be regulated like other entities that loan money to consumers. It is probably unrealistic to think that LFCs will be abolished, thus the question becomes whether they should be regulated, and if so, by whom. This article posits that LFCs should be regulated by the Bureau of Consumer Financial Protection, the Federal Trade Commission, or both. Federal regulation is necessary in order to provide a uniform set of rules that provide protection to consumers while also allowing LFCs the freedom to provide the funding that consumers have shown they are willing to seek and accept

Cause for Concern or Cause for Celebration?: Did Bostock v. Clayton County Establish a New Mixed Motive Theory for Title VII Cases and Make It Easier for Plaintiffs to Prove Discrimination Claims?

Title VII of the Civil Rights Act of 1964 makes it unlawful for an employer to discriminate against an employee “because of” race, color, religion, sex, or national origin. This seems simple enough, but if an employer makes an adverse employment decision partly for an impermissible reason and partly for a permissible reason, i.e., if the employer acts with a mixed motive, has the employer acted “because of” the impermissible reason? According to Gross v. FBL Financial Services, Inc. and University of Texas Southwestern Medical Center v. Nassar, the answer is no. The Courts in Gross and Nassar held that proving that an employer acted “because of” an impermissible reason requires proving “but for” causation, which means proving that the employer acted “solely because of” an impermissible reason. A United States Senator who participated in the debates surrounding the enactment of Title VII said, “If anyone ever had an action that was motivated by a single cause, he is a different kind of animal from any I know of.” On June 15, 2020, the Supreme Court decided Bostock v. Clayton County and held that an employer that terminates an employee because the employee is gay or transgender violates Title VII’s prohibition against sex discrimination. But that is not all Bostock did. At several points in the opinion, the Court held a Title VII plaintiff proves her employer acted “because of” an impermissible reason and proves “but for” causation even in cases where the employer acted with a mixed motive, so long as an impermissible reason was one of those motives, and the impermissible reason was decisive. Bostock thus departed from Gross and Nassar in its framing of what “but for” causation means in Title VII cases. This Article posits that Bostock articulated a new mixed motive theory that allows a Title VII plaintiff to prove “but for” causation in cases where the employer acted partly for an impermissible reason and partly for a permissible reason so long as the impermissible reason was decisive. Under this view of Bostock, it is now easier for a plaintiff whose employer acted with a mixed motive to prove “but for” causation and receive the full panoply of Title VII remedies

Third Party Funding of Personal Injury Tort Claims: Keep the Baby and Change the Bathwater

In the early 1990s, a period of high-risk lending at high interest rates, a new entrant emerged in civil litigation: the Litigation Finance Company (“LFC”). LFCs advance money to plaintiffs involved in contingency fee litigation. The money is provided on a non-recourse basis, meaning the plaintiff repays the LFC only if she obtains money from the lawsuit through a settlement, judgment, or verdict. If the plaintiff recovers nothing, she will not owe the LFC anything. When she does repay the LFC, however, she could end up paying as much as 280% of the amount advanced by the LFC. As one can see, LFCs make a lot of money. It is estimated that as of 2011, the total amount of outstanding advances exceeded $1 billion with$100 million being advanced annually. LFCs, like banks and credit card issuers, loan money to consumers with the expectation of being repaid the amount borrowed plus interest. Unlike banks and credit card issuers, however, LFCs are largely unregulated. The federal government does not regulate LFCs at all, and only Maine, Ohio, and Nebraska have enacted legislation regulating LFCs that operate in their respective states. What LFCs do is controversial, and the academic commentary about them is voluminous. Some commentators argue that LFCs should be abolished. Others say LFCs are the byproduct of willing sellers and willing buyers engaging in market transactions. Yet another group of commentators say LFCs serve a salutary purpose, but should be regulated like other entities that loan money to consumers. It is probably unrealistic to think that LFCs will be abolished, thus the question becomes whether they should be regulated, and if so, by whom. This paper posits that LFCs should be regulated by the Consumer Financial Protection Bureau, the Federal Trade Commission, or both. Federal regulation is necessary in order to provide a uniform set of rules that provide protection to consumers while also allowing LFCs the freedom to provide the funding that consumers have shown they are willing to seek and accept