eLABORate: Fifth Circuit Points in Different Directions on Emotional Distress Damages

December 22, 2016

Two separate panels of the Fifth Circuit issued decisions this month within three days of one another, ruling on emotional distress damages in employment cases. The rulings were somewhat inconsistent – the first (Vaughan v. Anderson Regional Medical Center) holding that emotional distress damages are not recoverable under the ADEA, and the second (Pineda v. JTCH Apartments, LLC, et al) holding that emotional distress damages are recoverable in FLSA retaliation cases. The latter case does not cite to the first, and the two panels were made up of completely different judges. Both cases, however, cited to longstanding Fifth Circuit precedent Dean v. American Security Insurance Co, and rely on similar statutory language. While the two new opinions do not directly conflict with one another, they are somewhat in tension.

Both Vaughan and Pineda cite heavily to Dean, which was decided in 1977, about a month prior to amendment of FLSA. In Dean, a defendant moved to strike the plaintiff’s prayer for “general and punitive” damages for an ADEA claim, and the district court overruled the defendant’s objection. After certifying the issue for an interlocutory appeal, however, the Fifth Circuit reversed. The Fifth Circuit noted that the ADEA’s damages provisions incorporate part of the enforcement provisions of FLSA, which allow for “legal or equitable relief … without limitation,” but then list some specific available categories of damages. While the plaintiff in Dean asked the court to read “legal or equitable relief … without limitation” to include all categories of damages, including punitive and general damages, the Court declined to do so, instead following the Third Circuit in rejecting pain and suffering damages for claims brought under the ADEA.

The two recent Fifth Circuit decisions both rely on Dean, but nevertheless come to different results. The first decision, Vaughan v. Anderson Regional Medical Center, was an ADEA retaliation claim in which the lower court asked the Fifth Circuit to determine if it was time to review and overrule Dean, as the passage of 40 years since Dean’s issuance had seen the rise of a circuit split and the EEOC’s adoption of a position that would allow emotional distress damages in ADEA cases. The Court upheld Dean, noting that, inter alia, no intervening change in law justified setting Dean aside. The plaintiff argued that Dean was decided by looking to pre-amendment FLSA, but that the subsequent statutory changes to FLSA had “enlarged the remedies available” for an ADEA claim. However, the Fifth Circuit noted that the FLSA language change incorporated language that was identical to language already provided in the ADEA at the time, and therefore that it did not compel enlargement of remedies to include emotional distress damages, despite the EEOC’s adoption of that view.

Vaughan was issued on December 16, 2016. Three days later, on December 19, a wholly different panel of judges issued the Pineda opinion, an FLSA retaliation case. Pineda holds that FLSA itself allows employees to recover for emotional injury resulting from retaliation – a seemingly inconsistent ruling to Vaughan, and one difficult to reconcile. In Pineda, the Court discussed a state of some confusion and inconsistency in its district courts with regard to whether emotional distress damages were available in FLSA cases. The Court noted that despite the fact that many other circuits had held that the 1977 FLSA amendments enlarged the statute to include emotional distress damages for retaliation cases, the district courts in the Fifth Circuit had felt constrained by Dean to rule that if there could be no emotional distress damages in ADEA cases – which relied on the FLSA statute for its damage provision – then clearly claims brought under FLSA itself were also precluded from relief for emotional distress. The Court then noted that the 1977 amendments to FLSA had enlarged the damages provisions therein, including emotional distress damages. Importantly, this is precisely the argument made – and rejected – by the plaintiff in Vaughan, issued just three days earlier. The Pineda Court clarified that Dean is still good law, as the ADEA itself contains more limiting language than FLSA, including a preference for administrative conciliation not present in the FLSA statute. However, the ruling is somewhat in tension with the Vaughan opinion, which specifically notes that the FLSA amendments do not enlarge the remedies available, and makes no reference to any separate limiting language in the ADEA.

Although it is clear that Dean is still relevant law in the Fifth Circuit, the Court has introduced some confusion as to whether the 1977 FLSA amendments enlarged the remedies available under the statute, given its inconsistent (and nearly simultaneous) rulings. Until either the Fifth Circuit or Supreme Court provides more clarity, litigators facing ADEA and FLSA retaliation claims should take care to thoroughly understand the somewhat conflicting views of emotional distress damages in the Fifth Circuit after Vaughan and Pineda.