On April 27, 2012, the Administrative Review Board (“ARB” or the “Board”) of the U.S. Department of Labor reaffirmed its policy of declining requests to reduce attorney’s fee awards merely because the amount requested is disproportionately larger than the damages recovered by a whistleblower. This ruling underscores the significance of whistleblower’s access to counsel, and represents another positive step in employees’ participation in the enforcement of violations in regulated industries.
In Clemmons v. Ameristar Airways, Inc, the complainant – Thomas E. Clemmons, a former employee of Ameristar Airways – was fired after complaining to the company about aircraft safety issues. Mr. Clemmons filed a whistleblower complaint against Ameristar alleging that his termination violated the employee protection provisions of the Wendell H. Ford Aviation Investment and Reform Act for the 21st Century (“AIR 21”). The AIR 21 law protects employees of air carriers and their contractors against retaliation for reporting concerns about air-safety issues.
On January 14, 2005, an Administrative Law Judge (“ALJ”) issued a decision and order in Mr. Clemmons’ favor, finding that Ameristar Airways’ actions violated the employee protection provisions of AIR 21 and awarding Mr. Clemmons $56,746 in back pay. On April 1, 2005, the ALJ also awarded Mr. Clemmons $225,293.00 in attorneys’ fees. Although the ARB initially vacated the decision and remanded it for further review, it later affirmed the ALJ’s decision and instructed Mr. Clemmons to petition the ALJ for reinstatement of the initial award. On June 23, 2011, the ALJ ordered reinstatement of the initial award of $225,293 for pretrial and trial work, as well as an additional $4,792.50 for services rendered on remand, for a total of $230,085.69. Ameristar appealed this award.
The issue before the ARB on appeal was whether the attorneys’ fees the ALJ awarded Mr. Clemmons were reasonable under AIR 21. In Evans v. Miami Valley Hospital, a 2009 case arising under AIR 21, the ARB established that “[a] successful complainant is entitled to receive all costs and expenses, including attorney’s fees, reasonably incurred in bringing the complaint.” Ameristar argued that the fee award of $230,085.69 was wholly unreasonable because, inter alia, it was “wildly disproportionate” to the damage award in the case. In rejecting Ameristar’s argument, the ARB emphasized that it has consistently refused to reduce attorney’s fee awards solely because the amount requested is larger than the recoverable damages. According to the Board, such a standard “would chill attorneys from taking moderately complicated cases where the complainant earned modest wages and hence the back pay sought would be small in relation to the attorney time expended.”
Lisa J. Banks, a partner at the whistleblower firm of Katz, Marshall and Banks, echoed the importance of this decision, stating that “the ARB’s recognition of the principle of non-proportionality helps whistleblowers by allowing them to obtain counsel for important cases even where the damages may be relatively small.” For more information on Whistleblower Law and protections for aviation workers, please visit the Whistleblower Law and Transportation pages on our website.