Articles Posted in Unfair Business Practices

restoration_work_parthenon_facade-1-scaledOne tool courts can use to manage litigation is a Special Master. A Special Master issues reports that a court can consider when ruling on a case. However, what happens if a court disregards the recommendations in a Special Master’s report? This situation raises intriguing questions about the authority and discretion of the court, leaving us to ponder the implications of such actions, as discussed in the case below.

Two attorneys – Patrick Kehoe, Jr. and Michael Rodriguez – entered into an oral fee-sharing agreement. Under the agreement, Rodriguez would receive half of the fees on personal injury cases from Kehoe that were resolved in trial or settled. Kehoe would finance the cases, and Rodriguez performed the required legal work. 

Rodriguez had to go to an inpatient facility because of his alcoholism. When he entered treatment, he had approximately sixteen unresolved cases. Rodriguez never returned to working with Kehoe. Rodriguez sought payment for his work on the sixteen unresolved cases. Kehoe proposed a fee-split agreement where Rodriguez would receive 20% of the collected attorney’s fees. Rodriguez at first rejected the proposal but later agreed to it. However, Rodriguez and Kehoe continued to dispute the fees owed. 

firefighter_extinguish_fire_484541-scaledIf you’ve ever left a job in the middle of a pay period, you might have had to wait to receive your final check. But what if you were fired, reinstated, fired, reinstated, and fired again? Payment of wages gets a bit more confusing.

In Alexandria, a firefighter named Kendall Dixon was terminated after a breath alcohol test in 2014. He spent the next several years defending his allegedly wrongful dismissal. Through separate litigation, he was also fighting for unpaid wages and fees. Both issues went through multiple stages of review to determine what sort of relief Dixon was entitled to receive.

Complicating Issue #2 – the question of compensation – was determining how Dixon would be paid for the time periods he would have been working (but for the allegedly wrongful termination) and for those he did work while his employment status yo-yoed.

document_paper_former_war-scaledNavigating receiving workers’ compensation benefits following an on-the-job injury can be difficult. It is even more difficult when you are an undocumented worker. Unfortunately, that is the situation Candido Perdomo, an undocumented worker, found himself in after he was injured when he was pinned underneath a garbage truck when a road collapsed. 

Perdomo filed a claim against RKC and its insurer after they reduced his workers’ compensation benefits following his injury.  RKC agreed that Perdomo was injured in the scope of his employment. Although they agreed that his average wage was $630 per week at the time of the accident and his compensation was $420 per week, they claimed that he had a weekly earning capacity of $145 per week after the accident, with a compensation rate of $323.33. Therefore, they claimed they had the right to reduce Perdomo’s benefits under La. R.S. 23:1206

This claim went to trial at the Office of Workers’ Compensation (“OWC”), who agreed with the Defendants that the reduction in Perdomo’s benefits to $323.33 was appropriate. The OWC noted that it was the Defendants’ burden to establish that Perdomo could physically perform a given job and that Perdomo had not met his burden of proof in showing that his injury caused his inability to work. The OWC also said that Perdomo could not rely on the fact he was undocumented as a reason he had not found work. Perdomo appealed. 

building_hospital_within_931281-scaledSome consider the workplace as their second home. It is a place where one can thrive intellectually and network simultaneously. However, when a workplace becomes hostile or sexually charged, it can make an employee’s life unbearable. Therefore, to bring a successful claim against FMLA and a hostile workplace, a plaintiff must prove all elements under FMLA and show proof the hostile environment affected their well-being.

Amy Smith (Smith) worked for Touro Infirmary (Touro) from 2008 to 2014 as a respiratory therapist. Smith claimed during her employment, her direct supervisor Larry Anderson (Anderson), sexually harassed her and created a sexually charged workplace. According to Smith, the female respiratory therapists who participated in Anderson’s advances were favored over those who did not comply. 

Smith took medical leave under the Family Medical Leave Act (FMLA) while pregnant and was later terminated. Smith alleged her termination was due to her noncompliance with Anderson’s sexual advances. She claimed this because she believed she abided by Touro’s leave policy of reporting while gone and provided additional medical documentation when needed. In addition, Smith filed a discrimination claim with the Equal Employment Opportunity Commission (EEOC) and referenced her discriminatory workplace. The district court dismissed Smith’s case on summary judgment, and she appealed. 

money_currency_dollars_euros-scaledA considerably large percentage of the United States population holds student loan debt. In addition, most individuals who attend higher education institutions in today’s society graduate with some debt. Phillip Kuzma knows this too well. 

Kuzma was sued by the National Collegiate Student Loan Trust (NCSL) for over $30,000 after allegedly defaulting on the loans he took out while a student at the University of New Orleans. After suing Kuzma, the NCSL thought they could get an easy judgment by using a procedural mechanism, a default judgment. Kuzma’s case discussed below shows the need to dot your i’s and cross your t’s when filing a default judgment in a Louisiana Court.

 In 2013, the NCSL filed a lawsuit, seeking approximately $30,000 in loans and $5,000 in interest as a result of nonpayment by Kuzma. In addition, the NCSL requested the court to order Kuzma to pay their attorney fees. The NCSL claimed these were the requirements expected of those who defaulted. 

building_hospital_enschede_928636-scaledPeople may be fired for a variety of reasons. Often a dismissed employee feels the termination was unjust or racially based. Bringing a lawsuit under Title VII of the Civil Rights Act of 1964 is difficult. A plaintiff must present evidence for a prima facie case of discrimination to survive summary judgment. The following case out of Baton Rouge, Louisiana, demonstrates the difficulty of doing so.

David Williams, an African-American man, worked for Franciscan Missionaries of Our Lady Health Systems, Inc., before being terminated in November 2012. Williams felt the firing was unfair and that he had claims to bring against the hospital. Williams’ lawsuit asserted racial discrimination and retaliation claims under Title VII and U.S.C. § 1981. 42 U.S.C. § 1981. The Federal District Court granted summary judgment for Our Lady Health on both claims. That ruling caused Williams’s case to be dismissed, so he appealed the ruling to the United States Court of Appeals for the Fifth Circuit.

On appeal, the court must examine the district court’s granting of summary judgment and if the non-moving party has met their prima facie burden. Summary judgment is appropriate when there are no disputes of material fact, and the movant is entitled to judgment in their favor as a matter of law.

lose_decay_old_factory_0-scaledIt is always difficult when you lose a job. But it can be even more difficult if you feel you were unfairly fired. If you find yourself in this situation, consider what legal options are available. This is the situation Christine Simpson found herself in after being fired from her job as a production technician in Canton, Mississippi.

Before she was terminated, Simpson allegedly injured her ankle on the job and pursued a claim under Mississippi’s workers’ compensation laws. Her employee, Kelly Services Inc., claimed she was fired for not calling in and for missing work after her doctor released her to return to work. Simpson, however, claimed that her absences were all excused due to her injury. She claimed that the real reason Kelly fired her was disability discrimination. 

Approximately two weeks after being terminated, Simpson filed a Petition for Chapter 13 Bankruptcy in the United States Bankruptcy Court for the Southern District of Mississippi. As part of the bankruptcy proceeding, Simpson was required to submit a Statement of Financial Affairs. One of the questions on the form asked her to list all lawsuits to which she was a party within one year immediately before filing for bankruptcy. Simpson checked the box labeled “none” next to that question. 

Like many states, Louisiana has an unfair trade practices act. In Louisiana, it is known as the Louisiana Unfair Trade Practices and Consumer Protection Law. Just as the name implies, this law is meant to protect consumers from the unfair, misleading, or fraudulent acts of those provide services, goods, and financing. Any contract or agreement entered into in violation of this law is void. However, the Louisiana Unfair Trade Practices and Consumer Protection Law (“Law”) has a serious limitation; it does not apply to a financial institution that is federally insured, including most banks and lending institutions.

The Law’s limitation means that an average mortgage arrangement from a large or national financial institution will not be affected by the protection that the Law affords. The United States Court of Appeals for the Fifth Circuit provides an example of this exception in a recent decision. In that case, a woman arranged for a home mortgage through Bank of America. Bank of America then assigned the mortgage to Wells Fargo. Both of these companies are large financial institutions that are federally insured.

When the woman defaulted on her mortgage, Wells Fargo sought to foreclose on her home. She applied for assistance from a federal government program called Home Affordable Modification Program (“HAMP”) during the foreclosure process. HAMP is designed to help modify mortgages for those who are in foreclosure proceedings so that they can keep their homes and pay a more affordable monthly payment. While the woman’s HAMP application was pending, the foreclosure proceeding was supposed to be put on hold. However, despite this application, her home was sold at a foreclosure sale before she received word back from HAMP to determine whether he application had been approved. She also claimed that she did not receive notice of the sale. Essentially, she argued that her home was sold out from under her without her knowledge.

She attempted to sue both Bank of America and Wells Fargo. She argued that Bank of America should not have allowed Wells Fargo to purchase the mortgage. She also argued that the foreclosure proceedings violated the Louisiana Unfair Trade Practices and Consumer Protection Law. However, the state court determined that even if they did violate the Law, the Law did not apply to them because of the financial institutions exception.

After a loss in state court, the woman appealed the case to the federal district court. However, the district court pointed out that it cannot sit as a court of appeals for state-exclusive actions. That means that the federal district court cannot hear a case where the only arguments are based on state law. Instead, a district court can only hear a case where there is some sort of federal jurisdiction based on either federal law or involves parties from different states, unless Congress has authorized the district court to act otherwise. Nonetheless, where a case questions the procedures of the state court, instead of applying substantive state law, then the federal court could hear the case. For example, if the woman argued that he procedure violated her constitutional rights, then the district court would likely be able to hear the case. This concept is known as the Rooker-Feldman doctrine. As the court explains, “Reduced to its essence, the Rooker-Feldman doctrine holds that inferior federal courts do not have the power to modify or reverse state court judgments except where authorized by Congress.”

In this case, the woman complained that the proceedings in the state court were incorrect; therefore, she was not just asking the district court to review the state court decision. As a result, the district court had the authority to review the case. Despite that fact, the woman failed to state a claim because both Bank of America and Wells Fargo are federally insured financial institutions that are not subject to the Louisiana Unfair Trade Practices and Consumer Protection Law. That meant that the Court of Appeals had to affirm the lower court, and the woman failed in her efforts to appeal.

It may have been possible to assert other arguments based on federal law, but the woman failed to do so. In fact, there were several arguments that the woman waived because she failed to timely assert them. In an appeal, if you do not assert every argument that you have in your opening brief, then you effectively lose the ability to use that argument at any point in the rest of the appeal. In this case, this may have been crucial to the woman’s case because she failed on the arguments that she presented originally (the state law claims). That point highlights the importance of competent attorneys who can argue effectively for you.  Continue reading


It is extremely important to review your home insurance policy to determine what types of damages the policy will actually cover, especially in areas prone to suffer from hurricane damages. Under Louisiana law, the insured individual is required to first prove that the insurance policy covers the cause of the claim. For example, if the policy only covers certain types of causes of damage, such as wind and hail, then the insured must prove that the damage was in fact caused by either wind or hail. Once the insured has done this, then the insurance company can argue that the incident is not covered by the policy. Therefore, it is extremely important that the insured take the time to determine the cause of the damage in order to prove that the policy covers their claim.


A case arising from Lake Charles, Louisiana illustrates this point. In this case, a homeowner suffered roof damage that they believed was caused by Hurricane Ike around September 13, 2008. Four shingles were missing and the insured claimed that this resulted in leakage in several rooms of the home. However, State Farm, the homeowner’s insurance company, determined that the leakage was not caused by Hurricane Ike and reclassified the claim as a “non-hurricane” claim.


State Farm, using several experts, determined that the leakage resulted from normal wear and tear on the roof, and therefore the homeowner’s insurance policy did not cover the leakage damage. Instead, State Farm concluded that only the four missing shingles were the result of wind and that they were the only damages that State Farm should reimburse to the insured; State Farm did not reimburse the insured for the damages caused by the leakage, but just the replacement value of the four damaged or missing shingles. The total damages that State Farm paid were under $500.00.


The insured had damages that were estimated at $9,385.00 by one expert and $204,717.78 by another expert. However, while these experts estimated what the cost of the leakage damage and repairing the roof would be, neither expert determined the actual cause of the damages. One of the insured’s experts thought that the wind had lifted the house’s flat roofing, which allowed water to enter the home. However, the expert could not explain why the nails on the flat roofing were still in place if the wind had lifted it. The State Farm expert, on the other hand, determined that the wind damage only included those four damaged or missing shingles and the leakage was actually caused by normal wear and tear. The State Farm expert concluded that there was “no evidence of roof damage that would be caused by severe weather . . . . The roofs, both asbestos shingle and built up roofs and all associated flashings are past their life cycle and are in need of replacement.”


The insured’s policy did not cover “poor workmanship; wear, tear, deterioration, or latent defect; settling, cracking, or expansion of walls, roofs, or ceilings; or leakage of water from air conditioning systems, household appliances, or plumbing.” Since the State Farm expert determined that the cause of the damage was from normal wear and tear, there was no way that the insured could satisfy the requirement to prove that the policy covered his claim. As such, the court granted State Farm summary judgment.


The court will grant summary judgment where one party cannot meet their required burden as a matter of law at trial. Summary judgment allows the court to avoid costly trials where there is one clear winner before the trial even begins. In this case, where the insured had no evidence that all of the damage he was claiming was caused by an occurrence included in the insurance policy, the court determined that summary judgment was appropriate. If the insured had employed experts that specifically testified as to the cause of the leakage damage, then the court may have allowed the case to proceed to trial. Further, the insured could have made a more diligent effort to report leakage as it occurred, which would help prevent the damage from spreading in the long run.


This case illustrates several very important points for the average homeowner. First, you should carefully read your policy so that you know what type of damage is covered. Second, if necessary, you may need to acquire experts that can explain what caused the damage to your home. Lastly, report damages immediately so that you can avoid costly repairs later on.  Continue reading

In an appeal filed in the United States Court of Appeals for the Fifth Circuit, from the Western District of Louisiana, the Court affirmed a district court verdict ruling in favor for the IRS. The Plaintiff, S.P. Lewis was ordered to pay monthly installments to the government to pay for taxes withheld from employee’s wages while S.P Davis and three other people were equal owners of the Winward Institute, Winward Heath Care Center, and Mynex. These three entities provide medical services to Louisiana patients. In 1997, these owners became aware that the companies were not paying enough federal payroll taxes. The owners asked the vice president of finance, Samuel Stevens, to negotiate with the IRS but the debt was never corrected.

In 2002, The IRS caught up with the companies and issued assessments against the owners for unpaid payroll taxes. Davis paid what he felt was his portion of the debt and then filed for a refund with the IRS. His claim was denied. In District Court, the government won the argument that the owners and Stevens were responsible people who had the opportunity to cure the dabt long ago. Because the owners and Stevens all had knowledge of the debt, and the opportunity to address the situation prior to suit, the owners and Stevers were considered equally responsible.

The government typically garnishes debtor’s wages in this situation. However, if the person in debt recieves income not exempt from taxes, the district court may order the person in debt to make payments instead of garnishing wages. When the Court established monthly payments against all counter-defendants, only Davis refused to pay. Davis did not want to pay the amount per month ordered by the government. Davis argued that the government was making him pay far too much each month. He argued the government was determining the monthly amount on a period in time when Davis had a much higher income. Davis also argued that the court had not properly considered his personal circumstances including the costs associated with earning his self-employment income.

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