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Equal Employment Opportunity Commission v. Grane Healthcare Co.

United States District Court, W.D. Pennsylvania

March 6, 2014

EQUAL EMPLOYMENT OPPORTUNITY COMMISSION, Plaintiff,
v.
GRANE HEALTHCARE CO. and EBENSBURG CARE CENTER, LLC, d/b/a CAMBRIA CARE CENTER, Defendants

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For EQUAL EMPLOYMENT OPPORTUNITY COMMISSION, Plaintiff: Lisa H. Hernandez, LEAD ATTORNEY, Deborah A. Kane, United States Equal Employment Opportunity Commission, Pittsburgh, PA; Ronald L. Phillips, U.S. Equal Employment Opportunity Commission - Baltimore Fie, Baltimore, MD.

For GRANE HEALTHCARE CO., EBENSBURG CARE CENTER, LLC, doing business as CAMBRIA CARE CENTER, Defendants: Richard J. Antonelli, LEAD ATTORNEY, Rebecca J. Dick-Hurwitz, Babst Calland Clements and Zomnir, P.C., Pittsburgh, PA; Theresa Creagh, Grane Healthcare, Pittsburgh, PA.

OPINION

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KIM R. GIBSON, UNITED STATES DISTRICT JUDGE.

MEMORANDUM OPINION

I. INTRODUCTION

This matter comes before the Court on cross-motions for summary judgment filed by the parties pursuant to Fed. R. Civ. Pro. 56. (ECF Nos. 92, 95). The Plaintiff seeks partial summary judgment on threshold issues relating to liability. (ECF No. 95). The Defendants move for summary judgment with respect to all claims brought against them. (ECF No. 92). For the reasons that follow, the Plaintiff's motion for partial summary judgment (ECF No. 95) will be granted in part and denied in part, and the Defendants' motion for summary judgment (ECF No. 92) will be denied.

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II. BACKGROUND

Grane Healthcare Company (" Grane" ) is an organization maintaining management contracts with several different entities. (ECF No. 115 at 1-2 ¶ 1.) Ross Nese (" Nese" ) serves as Grane's President. ( Id. at 2 ¶ 6). Len Oddo (" Oddo" ) is Grane's Chief Operating Officer. ( Id. at 2 ¶ 2). In that capacity, Oddo implements Grane's management contracts. ( Id. at 2 ¶ 4). He also serves as the Vice President of the Ebensburg Care Center, LLC (" ECC" ). ( Id. at 2 ¶ 3). Oddo reports to Richard Graciano (" Graciano" ), who serves as Grane's Chief Executive Officer (" CEO" ). ( Id. at 2 ¶ 5).

During the fall of 2009, Grane purchased the LaurelCrest Nursing and Rehabilitation Center (" LCNRC" ) from Cambria County. (ECF No. 115 at 2 ¶ 7). In connection with the purchase, the ECC was designated to become the owner and operator of a new facility known as the Cambria Care Center (" CCC" ). ( Id. at 2-3 ¶ 8). This arrangement was scheduled to become effective on January 1, 2010. ( Id. ).

Grane has a management consulting agreement with the CCC. (ECF No. 115 at 3 ¶ 9). According to the agreement, Grane was responsible for recruiting and hiring more than 300 employees to staff the CCC and care for its 200 residents. ( Id. at 5 ¶ ¶ 16-17). To fulfill that obligation, Grane invited the LCNRC's employees to apply for positions with the CCC. ( Id. at 5 ¶ 18). The application process began in October 2009, when the LCNRC's employees were informed of the impending sale. ( Id. at 6-7 ¶ ¶ 20, 23). Beth Lengle (" Lengle" ), Grane's Vice President of Nursing Services, was in charge of processing the applications. ( Id. at 5-6 ¶ 19). Individuals interested in applying for positions with the CCC were instructed to report to a conference room located within the LCNRC in order to complete the required paperwork. ( Id. at 8 ¶ 28). Pennsylvania's Older Adults Protective Services Act [35 PA. STAT. § 10225.101 et seq. ] requires covered healthcare facilities to consider the " criminal history record[s]" of all prospective employees in connection with the application process. 35 Pa. Stat. § 10225.502(a)(1). In accordance with that mandate, Lengle reviewed the " criminal history record" of each individual seeking employment with the CCC. (ECF No. 115 at 18 ¶ ¶ 56-57).

Grane typically requires every applicant to undergo a test for illegal drugs. (ECF No. 115 at 10 ¶ 33). Registered nurse Deborah Hoover (" Hoover" ), a nurse consultant for Grane, was responsible for administering the tests conducted on the LCNRC employees seeking employment with the CCC. ( Id. at 10 ¶ 34). Urine samples submitted by the applicants were screened for illicit substances. ( Id. at 11 ¶ ¶ 37-39). Forms provided to the applicants requested information about their medications. ( Id. at 115 ¶ 35). When an applicant's drug test yielded a positive result, Lengle crosschecked the test result with the list of the applicant's medications to determine whether the positive finding was attributable to a prescribed medication. ( Id. at 12 ¶ 41). An applicant was deemed to have passed the drug test if his or her disclosed medications corresponded with the positive test result. ( Id. at 12 ¶ 42). Grane maintained a policy of refusing to hire any applicant who was using a controlled substance without a prescription. ( Id. at 11 ¶ 40).

Corporate Care Services (" CCS" ) was contracted to conduct pre-employment physical examinations of the CCC's incoming employees. (ECF No. 115 at 8-9 ¶ 29). LCNRC employees interested in being considered for positions with the CCC were instructed to complete pre-placement

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evaluation forms provided by CCS. ( Id. at 9 ¶ 30). Each form solicited information about an applicant's medical history. ( Id. at 9 ¶ 31). A separate portion of the form was designed to record the results of a physical examination. ( Id. at 9 ¶ 31). Every applicant was required to undergo a medical examination, regardless of whether he or she was seeking to become a member of the CCC's medical staff. ( Id. at 19 ¶ 60). Charlene McFeeley (" McFeeley" ), a nurse practitioner employed by CCS, performed physical examinations of the LCNRC employees who were seeking employment with the CCC. ( Id. at 20 ¶ ¶ 63-64). After examining each prospective employee, McFeeley provided a written indication as to whether the individual was able to perform the " essential functions" of his or her desired position. ( Id. at 20-21 ¶ 65). Healthcare facilities such as the CCC are required to screen employees and contractors " with direct consumer contact" for tuberculosis. 35 Pa. Stat. § 448.806(d)(D.1)(5). Tuberculosis screenings were performed as a part of the CCC's application process. (ECF No. 115 at 18 ¶ 55).

More than 300 LCNRC employees applied for positions with the CCC. (ECF No. 115 at 21 ¶ 68). The applicants were examined by McFeeley during the fall of 2009. (ECF No. 98-3 at 5). Grane ultimately hired roughly 225 of the applicants to work for the CCC. (ECF No. 115 at 21 ¶ 68). Although most of the successful applicants were offered positions in person, there were situations in which individuals were offered positions by telephone. ( Id. at 21 ¶ 69).

The CCC began its operations on January 1, 2010. (ECF No. 115 at 5 ¶ 16). Shortly thereafter, several unsuccessful applicants for employment filed charges of discrimination with the Equal Employment Opportunity Commission (" EEOC" ), alleging that Grane and the ECC had violated the Americans with Disabilities Act of 1990 (" ADA" ) [42 U.S.C. § 12101 et seq. ] by conducting pre-offer medical examinations of prospective employees and declining to hire some of them because of actual or perceived disabilities. (ECF No. 116-24). The EEOC commenced this action against Grane and the ECC on September 30, 2010, seeking injunctive and monetary relief to remedy the alleged violations of the ADA. (ECF No. 1). Grane and the ECC answered the EEOC's complaint two months later. (ECF No. 8). On September 14, 2012, the EEOC filed a motion for partial judgment on the pleadings. (ECF No. 60). Grane and the ECC responded to the motion by seeking permission to amend their answer. (ECF No. 64). The motion for partial judgment on the pleadings was denied without prejudice in a memorandum opinion and order dated March 15, 2013. (ECF No. 86). Grane and the ECC filed their amended answer three days later. (ECF No. 87). The parties filed cross-motions for summary judgment on July 8, 2013. (ECF Nos. 92, 95). Those motions are the subject of this memorandum opinion.

III. STANDARD OF REVIEW

Summary judgment may only be granted where the moving party shows that there is no genuine dispute as to any material fact, and that a judgment as a matter of law is warranted. Fed.R.Civ.P. 56(a). Pursuant to Federal Rule of Civil Procedure 56, the Court must enter summary judgment against a party who fails to make a showing sufficient to establish an element essential to his or her case, and on which he or she will bear the burden of proof at trial. Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). In evaluating the evidence, the Court must interpret the facts in the light most favorable to the nonmoving party,

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drawing all reasonable inferences in his or her favor. Watson v. Abington Township, 478 F.3d 144, 147 (3d Cir. 2007). The burden is initially on the moving party to demonstrate that the evidence contained in the record does not create a genuine issue of material fact. Conoshenti v. Public Service Electric & Gas Co., 364 F.3d 135, 140 (3d Cir. 2004). A dispute is " genuine" if the evidence is such that a reasonable trier of fact could render a finding in favor of the nonmoving party. McGreevy v. Stroup, 413 F.3d 359, 363 (3d Cir. 2005). Where the nonmoving party will bear the burden of proof at trial, the moving party may meet its burden by showing that the admissible evidence contained in the record would be insufficient to carry the nonmoving party's burden of proof. Celotex Corp., 477 U.S. at 322. Once the moving party satisfies its burden, the burden shifts to the nonmoving party, who must go beyond his or her pleadings and designate facts by the use of affidavits, depositions, admissions, or answers to interrogatories showing that there is a genuine issue of material fact for trial. Id. at 324. The nonmoving party cannot defeat a well-supported motion for summary judgment by merely reasserting unsupported factual allegations contained in his or her pleadings. Williams v. Borough of West Chester, 891 F.2d 458, 460 (3d Cir. 1989).

IV. JURISDICTION AND VENUE

The Court has jurisdiction to entertain the EEOC's claims pursuant to 28 U.S.C. § 1331, 42 U.S.C. § 2000e-5(f)(3), and 42 U.S.C. § 12117(a). Venue is proper under 28 U.S.C. § 1391(b).

V. DISCUSSION

Title I of the ADA contains provisions governing the conduct of covered employers in relation to their current and prospective employees. 42 U.S.C. § § 12111-12117. Title I's anti-discrimination provision, codified at 42 U.S.C. § 12112(a), provides that " [n]o covered entity shall discriminate against a qualified individual on the basis of disability in regard to job application procedures, the hiring, advancement, or discharge of employees, employee compensation, job training, and other terms, conditions, and privileges of employment." The term " qualified individual" is defined as " an individual who, with or without reasonable accommodation, can perform the essential functions of the employment position that such individual holds or desires." 42 U.S.C. § 12111(8). The " discrimination" prohibited by § 12112(a) is defined broadly enough to include a covered entity's failure or refusal to " mak[e] reasonable accommodations to the known physical or mental limitations of an otherwise qualified individual with a disability who is an applicant or employee, unless such covered entity can demonstrate that the accommodation would impose an undue hardship on the operation of the business of such covered entity," or its " den[ial of] employment opportunities to a job applicant or employee who is an otherwise qualified individual with a disability, if such denial is based on the need of such covered entity to make reasonable accommodation[s] to the physical or mental impairments of the employee or applicant . . . ." 42 U.S.C. § 12112(b)(5)(A)-(B). In this context, " reasonable accommodations" may include " job restructuring," a " part-time or modified" work schedule, a " reassignment to a vacant position," or the " acquisition or modification of equipment or devices." 42 U.S.C. § 12111(9)(B).

Since § 12112(a) prohibits only discrimination " on the basis of disability," an individual must be " disabled" to enjoy statutory protection thereunder. Macfarlan v. Ivy Hill SNF, LLC,

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675 F.3d 266, 274 (3d Cir. 2012). " [A] physical or mental impairment that substantially limits one or more [of an individual's] major life activities" qualifies as a " disability" under the ADA.[1] 42 U.S.C. § 12102(1)(A). It is axiomatic that an employer cannot discriminate against an applicant for employment " on the basis of disability" without knowing that he or she is " disabled." Geraci v. Moody-Tottrup, Int'l, Inc., 82 F.3d 578, 581 (3d Cir. 1996). To provide prospective employees with prophylactic protection against the forms of " discrimination" proscribed by Title I, Congress has taken steps to limit the information available to covered employers at critical stages of the hiring process. The provisions of the ADA pertaining to medical examinations and inquiries are codified at 42 U.S.C. § 12112(d), which provides:

(d) Medical examinations and inquiries.
(1) In general. The prohibition against discrimination as referred to in subsection (a) shall include medical examinations and inquiries.
(2) Preemployment.
(A) Prohibited examination or inquiry. Except as provided in paragraph (3), a covered entity shall not conduct a medical examination or make inquiries of a job applicant as to whether such applicant is an individual with a disability or as to the nature or severity of such disability.
(B) Acceptable inquiry. A covered entity may make preemployment inquiries into the ability of an applicant to perform job-related functions.
(3) Employment entrance examination. A covered entity may require a medical examination after an offer of employment has been made to a job applicant and prior to the commencement of the employment duties of such applicant, and may condition an offer of employment on the results of such examination, if --
(A) all entering employees are subjected to such an examination regardless of disability;
(B) information obtained regarding the medical condition or history of the applicant is collected and maintained on separate forms and in separate medical files and is treated as a confidential medical record, except that --
i. supervisors and managers may be informed regarding necessary restrictions on the work or duties of the employee and necessary accommodations;
ii. first aid and safety personnel may be informed, when appropriate, if the disability might require emergency treatment; and
iii. government officials investigating compliance with this Act shall be provided relevant information on request; and
(C) the results of such examination are used only in accordance with this title.

(4) Examination and inquiry.

(A) Prohibited examinations and inquiries. A covered entity shall not

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require a medical examination and shall not make inquiries of an employee as to whether such employee is an individual with a disability or as to the nature or severity of the disability, unless such examination or inquiry is shown to be job-related and consistent with business necessity.
(B) Acceptable examinations and inquiries. A covered entity may conduct voluntary medical examinations, including voluntary medical histories, which are part of an employee health program available to employees at that work site. A covered entity may make inquiries into the ability of an employee to perform job-related functions.
(C) Requirement. Information obtained under subparagraph (B) regarding the medical condition or history of any employee are subject to the requirements of subparagraphs (B) and (C) of paragraph (3).

42 U.S.C. § 12112(d). This statutory framework is designed to shield information about an applicant's medical condition from his or her prospective employer until after an offer of employment is made.

Before an offer of employment is extended, an employer may not ask a job applicant to undergo a medical examination or inquire as to whether he or she " is an individual with a disability." 42 U.S.C. § 12112(d)(2)(A). This prohibition precludes the utilization of investigative techniques that could identify applicants with disabilities and exclude them from further consideration. Griffin v. Steeltek, Inc., 160 F.3d 591, 594 (10th Cir. 1998). Once an offer of employment has been extended, a prospective employee may be asked to undergo a medical examination. 42 U.S.C. § 12112(d)(3). An " entrance examination" is permissible under the ADA if " all entering employees are subjected to such an examination regardless of disability," the applicable confidentiality requirements are adhered to, and the results of the examination are " used only in accordance with" Title I. 42 U.S.C. § 12112(d)(3)(A)-(C). After an employee's duties have commenced, the employer may not ask him or her to undergo another medical examination or inquire as to whether he or she is disabled " unless such examination or inquiry is shown to be job-related and consistent with business necessity." 42 U.S.C. § 12112(d)(4)(A). An employer remains free to inquire as to the ability of an applicant or employee " to perform job-related functions" at all times. 42 U.S.C. § 12112(d)(2)(B), (4)(B).

Given that § 12112(d)(3)(C) permits the results of an " entrance examination" to be " used only in accordance with" Title I's anti-discrimination provision, an employer may not rely on the results of a lawful medical examination or inquiry to deny employment to an individual unless the examination or inquiry reveals that an impairment suffered by the individual would preclude him or her from performing the " essential functions" of the job in question. Holiday v. City of Chattanooga, 206 F.3d 637, 640-48 (6th Cir. 2000). A plaintiff asserting a claim under § 12112(d)(3)(C) must ordinarily show that he or she is " disabled," since § 12112(a) only prohibits " discriminat[ion] against a qualified individual on the basis of disability" O'Neal v. City of New Albany, 293 F.3d 998, 1009-10 (7th Cir. 2002). Unlike § 12112(a), which aims to protect a discrete class of " disabled" persons from discrimination, § 12112(d) contains no language limiting the category of applicants and employees entitled to statutory protection. Cossette v. Minnesota Power & Light, 188 F.3d 964, 969 (8th Cir. 1999). Consequently, an individual who is subjected

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to an unlawful medical examination or inquiry can successfully assert a claim under § 12112(d) without establishing the existence of a statutory " disability." Pennsylvania State Troopers Association v. Miller, 621 F.Supp.2d 246, 252 (M.D. Pa. 2008). In this vein, an applicant who is rejected by an employer based on information gleaned from an illegal pre-offer medical examination or inquiry may seek redress under § 12112(d)(2)(A) even if that information does not reveal a " disabling" medical condition. Griffin, 160 F.3d at 593-94.

It is undisputed that the LCNRC employees seeking positions with the CCC were subjected to pre-offer medical examinations and inquiries prohibited under the ADA. (ECF No. 131 ¶ ¶ 1-2). The EEOC asserts § 12112(d) claims against the Defendants based on those examinations and inquiries. (ECF No. 1 ¶ 12(c)-(d)). According to the EEOC, discovery has revealed that 26 unsuccessful applicants were " disabled" within the meaning of the ADA during the relevant period of time. (ECF No. 114 at 20-22). The Defendants concede that those individuals were statutorily " disabled" for purposes of the pending motions for summary judgment.[2] (ECF No. 130 at 1). In addition to the § 12112(d) claims premised on the unlawful medical examinations and inquiries, the EEOC brings § 12112(a) claims on behalf of the 26 " disabled" applicants who were not offered positions with the CCC. (ECF No. 1 at ¶ 12(g)).

The motion for partial summary judgment filed by the EEOC relates only to the claims arising under § 12112(d). (ECF No. 95). Since it is undisputed that illegal pre-offer medical examinations and inquiries were conducted in connection with the CCC's hiring process, the EEOC seeks an order enjoining the Defendants from violating § 12112(d) in the future. (ECF No. 95-1 at 9). The EEOC also requests that " further proceedings" be held " to determine individualized remedies for the aforementioned violations of the ADA." ( Id. ). The Defendants broadly move for summary judgment with respect to all claims asserted against them in this case. (ECF No. 92).

A. The EEOC's Standing to Assert ADA Claims on Behalf of the Aggrieved Applicants

A federal court operating under the strictures of Article III of the Constitution " generally may not rule on the merits of a case without first determining that it has jurisdiction over the category of claim in suit." Sinochem International Co., Inc. v. Malaysia Int'l Shipping Corp., 549 U.S. 422, 430-31, 127 S.Ct. 1184, 167 L.Ed.2d 15 (2007). Like all other Article III tribunals established by Congress, this Court exercises " [t]he judicial Power of the United States." U.S. Const., ART. III, § 1. This " judicial Power" is validly exercised only where a live " case" or " controversy" exists between the parties. Hollingsworth v. Perry, 133 S.Ct. 2652, 2659, 186 L.Ed.2d 768 (2013). The power vested in a federal court " exists only to redress or otherwise to protect against injury to the complaining party,

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even though the court's judgment may benefit others collaterally." Warth v. Seldin, 422 U.S. 490, 499, 95 S.Ct. 2197, 45 L.Ed.2d 343 (1975). An action does not constitute a justiciable " case" or " controversy" for constitutional purposes unless the person bringing the action has the proper legal " standing" to do so. Flast v. Cohen, 392 U.S. 83, 95, 88 S.Ct. 1942, 20 L.Ed.2d 947 (1968). To satisfy the Constitution's " requirement of standing," " [a] plaintiff must allege personal injury fairly traceable to the defendant's allegedly unlawful conduct and likely to be redressed by the requested relief." Allen v. Wright, 468 U.S. 737, 751, 104 S.Ct. 3315, 82 L.Ed.2d 556 (1984). " This triad of injury in fact, causation, and redressability comprises the core of Article Ill's case-or-controversy requirement, and the party invoking federal jurisdiction ...


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