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No happy ending for reinstatement order

An employee won reinstatement with the employer she said violated her rights under the Family and Medical Leave Act, but the reinstatement didn’t work out the way the court had hoped. Last week, a federal judge figuratively threw up his hands and found “exceptional circumstances” to vacate the reinstatement order.

In April, a jury awarded Leslie Fay Lusk $25,258 in back pay on her claim that her employer, Virginia Panel Corporation, interfered with her FMLA rights. Harrisonburg U.S. District Judge Michael Urbanski also ordered VPC to reinstate Lusk.

The judge recognized there might be some tension, but said he didn’t believe reinstatement would be a “harbinger of disaster and a catalyst to more litigation.” Lusk, a human resources assistant, had been a long-time employee with “fully acceptable evaluations.” Urbanski optimistically expected that both parties would “put forward a good faith effort to recapture as much of their prior positive working relationship as possible.”

In September, the parties were back in court on VPC’s motion for a new trial based on new evidence of how things were not quite working out the way the judge had hoped.

VPC said Lusk’s former position as a human resources assistant had been eliminated and she was not qualified for any existing open position. Supported by affidavits from VPC employees, the company said it was dealing with the “type of extreme hostility, animosity or lack of a productive and amicable working relationship that renders reinstatement inappropriate.”

Ultimately, the company suspended Lusk with pay, and she filed another charge with the Equal Employment Opportunity Commission.

The court said VPC’s motion for a new trial based on “new evidence” or “newly discovered evidence” didn’t quite fit the facts, as events that had taken place after Lusk’s reinstatement were not covered by a motion under Fed. R. Civ. P. 59(a).

Sua sponte, Urbanski suggested another approach: Rule 60(b)(5) permits a court to alter or amend a judgment when, upon a showing of “exceptional circumstances,” applying the judgment prospectively “is no longer equitable.”

“This may very well be one of those cases where the litigation itself has created such animosity between the parties that any potential employer-employee relationship has been irreparably damaged,” Urbanski wrote.

It “appears that the remedy of reinstatement is no longer equitable in this case,” he concluded. In Lusk v. Virginia Panel Corporation, he vacated the order of reinstatement and awarded Lusk six additional months of front pay.

The court also awarded Lusk attorney’s fees and costs of $186,276.79, something short of the $311,265 in fees and $9,602 in costs she had sought. Urbanski set the hourly rate for Shelley Cupp Schulte PC partners in the case at $300 per hour. An associate had billed at $275 per hour, but Urbanski noted the work billed consisted of “time traveling to and from hearings and the trial and time attending these hearings and the trial.”

Urbanski set the associate’s hourly rate at $150 an hour. He further reduced the fee award by 5 percent for “block billing” and reduced it another 25 percent, based on the defendant’s argument that Lusk ultimately had recovered on only one of her claims for relief.

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