A federal judge ruled this week that the University of Wyoming Foundation, the nonprofit that raises money for the university, could possibly be held liable for civil rights claims made under the Americans with Disabilities Act.
The Foundation, as well as the university itself, is currently being sued by former human resources director, Mandy Davis, who claims she was fired in retaliation for filing a discrimination complaint.
Attorneys for the Foundation, however, have argued the nonprofit is not subject to ADA rules because it does not have at least 15 employees, a threshold used to make a organization subject to protections offered by both ADA and Title VII of the Civil Rights Act of 1964.
Technically, the Foundation has one employee: its CEO, Ben Blalock.
The rest of its staff are formally employed by the university itself.
However, District Court Judge Alan Johnson ruled Wednesday a “reasonable jury” could decide the UW Foundation is a “joint employer” of its staff, or that UW and the Foundation are a “single employer,” thereby making the Foundation liable for certain civil rights claims.
Davis’s attorneys argued the Foundation and UW are “so intertwined that it is impossible to discern where one entity stops and the other begins.”
In asking for Johnson to throw out the case, the Foundation’s attorneys argued in July the nonprofit and UW were distinguishable enough to make the Foundation exempt from ADA claims.
Johnson, however, noted several factors indicating otherwise, including the fact that Blalock has control over the hiring of Foundation senior staff and the two organizations “share staff, office space, and use the same website.”
The lawsuit stems from a June 2015 incident, when Davis hired an employee — the most qualified candidate — who had an apparent physical disability. Blalock apparently took issue with the hiring and Davis was allegedly told to not hire another “retard.”
The lawsuit’s defendants denied that claim.
Davis filed a discrimination complaint, which Blalock later said made him distrust her. Six months later, Davis was laid off as part of a Foundation reorganization, which followed a university-wide hiring freeze initiated by former UW President Dick McGinity amid Wyoming’s economic downturn.
After being laid off in December 2015, Davis was retrenched to another HR position in March 2016. She later left for a position with HiViz Shooting Solutions in 2018.
The allegations in the lawsuit depict Blalock as someone who’s hostile to laws regarding disability discrimination.
When Davis was hired, she said Blalock complained that HR personnel “lack common sense” in enforcement of discrimination rules.
In a earlier OFCCP training, Blalock reportedly complained that “idiotic” discrimination rules could force him to hire “someone who constantly lost control of their bowel movements in a donor’s house where you were asking for millions of dollars.”
“Blalock’s example was indelicate, but his frustration with the training results from lack of communication and the impression that inaccurate information was provided,” former general counsel Rick Miller said in a 2015 analysis of Davis’s complaints. “It is of course the case that a person with a bowel control issue can be fully qualified to perform duties that include working with major donors. … (Blalock) believes he was advised that he was required to hire someone who literally would soil themselves in a repeated and visible way during business meetings. The law does not require that.”
Janean Lefevre, who conducted the OFCCP training, told investigators she remembered Blalock’s outburst clearly because “he was the only one out of hundreds” to react so negatively to training about disability discrimination.
Davis also said that, when she was hired, Mary Ivanoff, UW vice president for administration and donor relations, warned her “Ben doesn’t like fat people.”
“I did not ask whether or not Blalock liked ‘fat people’,” Miller wrote. “Blalock is entitled to have a vision and culture in his unit so long as it does not violate law or UW regulation.”
Mary Ann Garman, the Foundation’s vice president for financial services, said in a deposition that Blalock stressed Davis couldn’t be trusted shortly after the discrimination complaint was filed.
“I just simply said that as you visit with Mandy, I would just ask that you be cautious just because clearly, we felt that we could talk with Mandy in various conversations, and suddenly we didn’t have that trust, and this is a very important position being the director of HR,” Blalock said in a deposition.
Davis had been a mandatory reporter, meaning she’s required to report any possible discrimination.
Despite that, Blalock openly expressed frustration that Davis filed a discrimination complaint.
Davis “was an individual who I would view the confidentiality of the types of conversations you would have with the director of HR are pretty much always sensitive conversations,” Blalock said in a deposition. He said he “was disappointed that Mandy had decided to have conversations with, I guess, the employee protection office.”
Jim Osborn, UW’s Title IX coordinator, testified it’s common for recipients of a HR complaint to express their frustration to others.
“In almost every case somebody goes and says — goes home and tells their family, their friends, their co-workers, somebody’s made a complaint against me or you won’t believe what happened at work today. Very common,” he told attorneys in his deposition.
Osborn noted in his deposition that Davis “admonishes everyone often.”
Davis’s lawsuit faced a setback in August, when magistrate judge Kelly Rankin declined to force UW to hand over certain emails from 2015 to Davis’s attorneys.
Because of Blalock’s position as a university vice president, Osborn took the unusual step of having Miller handle the initial discrimination investigation. Miller later testified it was the only Equal Opportunity Report and Response investigation he participated in during his time as general counsel.
“At that time I did not have the title or level of authority that I felt was appropriate,” Osborn said during a deposition.
Miller and current lead counsel Tara Evans exchanged a number of emails concerning the case with Blalock and Ivanoff during the handling of the discrimination.
“Miller’s role as the university’s in-house counsel is, in part, to minimize and protect the university against the risk of litigation, a role that may conflict with the university’s responsibility to fairly and equitably investigate Ms. Davis’s discrimination complaint against a university vice president and another high ranking UW official,” Davis’s attorneys say in a June 29 filing.
In the weeks between the implementation of McGinity’s hiring freeze and the submission of a reorganization plan, Miller again corresponded with Ivanoff and Blalock via email.
Davis’s attorneys have argued those emails, if handed over, would be likely to reveal Miller helped invent a false justification for eliminating Davis’s position.
However, UW’s attorneys have withheld many of those emails, citing attorney-client privilege.
Davis’s attorneys have argued those emails should be released since UW’s attorneys have used their existence to argue Ivanoff and Blalock “exercised reasonable care to ensure that no employee rights were being violated by the foundation’s reorganization plan.”
Davis’s attorneys argue UW should not be allowed to use the emails as both “a sword and a shield” to combat the retaliation claim.
“Ms. Davis has the right to discover what influence UW’s general counsel used to ensure that Nell Russell and President McGinity approved the Foundation’s reorganization plan without asking a single question, putting at issue the University’s claim of performing due diligence in approving the plan,” the attorneys said.
After reviewing the emails, Rankin agreed Aug. 17 that “Miller cannot simultaneously represent Blalock and Ivanoff by providing them with legal advice while investigating discrimination complaints against them.”
However, he said there’s still “little question” the emails are protected by attorney-client privilege.
“In reviewing the emails in-camera it is clear Mr. Blalock and Ms. Ivanoff were aware they were being questioned regarding a discrimination complaint, and that their communications would assist counsel in providing legal advice,” Rankin said. “The privilege protecting the communications was not the attorney-client privilege between the individuals, but rather the privilege between the University and counsel protecting information necessary to provide legal advice regarding the discrimination complaint. Therefore, the communications at issue are privileged and need not be disclosed.”
Shortly after Rankin’s ruling, Davis’s attorneys asked him to reconsider. They said he “erroneously” determined Miller’s emails were protected because he was acting as counsel to UW.
They noted a UW statement that acknowledged “Miller is responsible for the administration of the Office of Diversity and Employment Practices and was acting in his capacity as an investigator” when dealing with Blalock and Ivanoff.
The 10th Circuit Court of Appeals held in 1998 that, for communications to be covered by attorney-client privilege, “a communication between a lawyer and client must relate to legal advice or strategy sought by the client.”
Even if the communications were subject to attorney client privilege, Davis’s attorneys say privilege has been waived by “selectively releasing information gained during his participation in the investigation.”
In a Sept. 28 court filing, attorneys for Blalock said the reorganization was a logical response to McGinity’s hiring freeze.
“With the hiring freeze in place, the division could no longer expand its staff as hoped,” the attorneys wrote. “Therefore, the need for the HR business manager no longer existed.”
Attorneys for UW noted that, when Davis was hired back at another position at UW in March 2016, Ivanoff “gave a favorable recommendation.”
Despite the UW Foundation reorganization, McGinity approved two exceptions to his hiring freeze for the Foundation, which conducted a search to fill two positions at the same time Davis’s position was being eliminated.
Johnson said Wednesday he “is unaware of anything in the record that suggests the University conducted any meaningful review of the plan.”
Before she filed the discrimination complaint, Davis’s work was frequently “micromanaged” by Ivanoff, she said.
In a retaliation report finalized in June 2016, Davis said Ivanoff and Blalock “pretty much ignored me” and “kept their distance” after the discrimination complaint was filed.
“It was kind of refreshing at first, but I knew it wasn’t normal,” she said.
At the time McGinity approved the reorganization, he had not been informed Davis filed a discrimination complaints against her superiors that year.
Nell Russell, who helmed the university’s human resources department, was in charge of reviewing all reorganization plans to determine whether employee rights were being violated. Russell said she relied solely on Blalock’s written justification for the UW Foundation reorganization to determine the layoffs were allowable.
“(Blalock) padded the reorganization by claiming to retrench three other employees whose jobs at the Foundation he knew were about to end, even without the reorganization,” Davis’s attorneys said in an Oct. 11 filing.
While Blalock said the reorganization decisions were made as a group by the Foundation’s senior leadership team, Garman testified Blalock apparently unilaterally made the decision before she was informed at a meeting held Nov. 6, 2015.
“I don’t know for positive who made the decision,” she testified. “All I know was I learned about this when I went into this meeting.”
Garman testified she had “a feeling” Davis was included in the reorganization because of the discrimination claim.