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1998 Term, Number 6 / January 11, 1999

On Friday, January 8, the Supreme Court granted certiorari in five cases that are of potential interest to the business community, and ordered a slightly expedited briefing schedule. The five cases fall into two groups of related cases. Amicus briefs in support of the petitioners are due on February 22, 1999, and amicus briefs in support of the respondents are due on March 24. On Monday, January 11, the Court adopted various revisions to its Rules (effective May 3, 1999), including changes to the typeface that must be used in printed briefs. Any questions about the granted cases or the Court's rule changes should be directed to Alan Untereiner (202-778-0656) or Donald Falk (202-778-0174) in our Washington office.

I. Americans with Disabilities Act Successfully Treated Medical Conditions as "Disabilities."

The Americans with Disabilities Act (ADA) prohibits employers from discriminating "against a qualified individual with a disability." 42 U.S.C. 12112(a). The ADA defines a disability as a "physical or mental impairment that substantially limits one or more of the major life activities of such individual." Id. 12102(2). A plaintiff invoking the ADA bears the burden of proving that he or she has, or is "regarded as having," a disability. Id. 12102(2)(C). The Supreme Court granted certiorari in three cases to decide whether the determination that an employee has a disability under the ADA must be made without regard to the effect of mitigating measures such as medicines or prosthetic devices. See Sutton v. United Air Lines, No. 97-1943; Murphy v. United Parcel Service, No. 97-1992; Albertsons, Inc. v. Kirkingburg, No. 98-591. In Murphy, the Court will also decide whether an employee has been "regarded as having" a disability if the employer terminates the employee for failing to satisfy physical standards established by an independent third party such as a federal agency. And in Albertsons, the Court will also decide whether an employer that relies on a government agency standard violates the ADA if it does not accept the agency's waiver of that standard as to a particular employee.

The plaintiffs in Sutton are twin sisters who applied for employment as commercial pilots with United Air Lines (UAL). UAL refused to hire them on the ground that each sister's uncorrected vision 20/200 in one eye, 20/400 in the other fell far below UAL's minimum vision standard for pilots. The sisters sued UAL, alleging a violation of the ADA, but the district court granted summary judgment in UAL's favor. The court reasoned that the sisters' myopia, although a physical impairment within the meaning of the ADA, was not "substantially limiting" because it could be completely alleviated through the use of corrective lenses. The Tenth Circuit affirmed, reasoning that the ADA is "concerned with whether the impairment affects the individual in fact, not whether it would hypothetically affect the individual without the use of corrective measures." 130 F.3d 893, 902 (1997). The court of appeals refused to defer to an EEOC advisory opinion suggesting that disability determinations should not take into account the effectiveness of mitigating measures like corrective lenses.

Albertsons also involves a vision impairment. Albertsons employed Hallie Kirkingburg as a truck driver. His corrected vision is 20/20 in the right eye but his left eye corrects to no better than 20/200 because of amblyopia, commonly known as "lazy eye." Albertsons required its drivers to hold a medical certification under Department of Transportation (DOT) commercial vehicle regulations. Although Kirkingburg had been certified in the past because of physicians' errors, his impairment eventually kept him from being recertified. Kirkingburg obtained a waiver from DOT, however, after demonstrating that he could operate a truck safely despite his impairment. Notwithstanding this waiver, Albertsons terminated Kirkingburg. After Kirkingburg sued his former employer under the ADA, the district court granted summary judgment to Albertsons, finding that Kirkingburg was not qualified for employment because of his visual impairment. The Ninth Circuit reversed. 143 F.3d 1228 (1998). The court of appeals held that Kirkingburg was disabled within the meaning of the ADA because he "sees using only one eye" while "most people see using two." Id. at 1232. The Ninth Circuit placed no weight on the fact that Kirkingburg's visual cortex "compensates for his disability." Ibid. The Ninth Circuit also held that the DOT's waiver of its regulations as they applied to Kirkingburg prevented Albertsons from justifying its dismissal of Kirkingburg on the ground that he could not obtain DOT certification. Id. at 1234-1236.

The third case, Murphy, also involved DOT medical certification. United Parcel Service (UPS) hired Vaughn Murphy as a mechanic. Because his job would require him to road-test vehicles from time to time, UPS required Murphy to obtain a DOT medical certification before beginning work. Without medication Murphy has very high blood pressure (250/160); even with medication, his blood pressure exceeds the DOT standard of 160/90. DOT issued Murphy a health certification only because it overlooked his non-compliant blood pressure. After discovering this error, UPS terminated Murphy's employment when his retested blood pressure also exceeded the DOT standard.

Murphy sued under the ADA. The district court granted summary judgment to UPS, holding that Murphy was not disabled within the meaning of the ADA because his medication enabled him to perform all of the major life functions. 946 F. Supp. 872 (D. Kan. 1996). The district court also rejected Murphy's claim that, as a result of his inability to qualify for DOT certification, UPS regarded him as having a disability, drawing a distinction between regarding Murphy as "disabled" and regarding him merely as "not certifiable" under DOT regulations. The Tenth Circuit affirmed in an unpublished opinion. UPS did not oppose certiorari on the question whether Murphy's treatable high blood pressure rendered him disabled under the ADA.

The United States and the EEOC supported certiorari and reversal in Murphy (and supported holding Sutton until Murphy was decided). In the government's view, disability determinations should not take mitigating measures into account. The government also contends that, as a matter of law, UPS "regarded" Murphy as disabled by virtue of his inability to obtain DOT certification.

There is a deep conflict on the principal question on which review was granted in these three cases. The Sixth and Tenth Circuits appear to be alone in holding that an employee is not disabled if his impairment can be successfully treated through medication or prosthetic devices. The Ninth Circuit's position that a "disability" includes any condition that makes an individual perform a major life activity "differently" from most people appears to have support only in the Eighth Circuit. See Doane v. City of Omaha, 115 F.3d 624 (8th Cir. 1997), cert. denied, 118 S. Ct. 1349 (1998). Most circuits agree with the Eighth and Ninth Circuits that disability determinations should be made without regard to mitigation. See, e.g., Arnold v. United Parcel Service, 136 F.3d 854 (1st Cir. 1998); Roth v. Lutheran General Hospital, 57 F.3d 1446 (7th Cir. 1995). The Fifth Circuit has gone its own way, considering the efficacy of mitigating treatments on serious conditions but not on others. See Washington v. HCA Health Services, 152 F.3d 464 (5th Cir. 1998). The petitions did not identify any conflicting decisions on the questions relating to government health standards.

These cases are of enormous interest to all employers. As ADA litigation becomes widespread, employers are increasingly caught between their obligations to conduct business safely and their obligations to accommodate their employees' physical and mental disabilities. Employers may wish to be heard on the question whether the protected class of the "disabled" should be expanded to include all persons with common and fully correctable physical impairments.

I. ELEVENTH AMENDMENT Amenability of States to Damages Actions for Patent Infringement and Unfair Competition.

The Eleventh Amendment immunizes unconsenting States from suits for damages in federal courts. Three years ago the Supreme Court held that Congress can abrogate that immunity only through legislation enacted pursuant to Section 5 of the Fourteenth Amendment, which authorizes Congress to enforce due process rights and other limits on state action embodied in that Amendment. Seminole Tribe of Florida v. Florida, 517 U.S. 44 (1996). The Court granted certiorari in College Savings Bank v. Florida Prepaid Postsecondary Education Expense Board, No. 98-149, and Florida Prepaid Postsecondary Education Expense Board v. College Savings Bank, No. 98-531, to determine the constitutionality of Congress's explicit abrogation of Eleventh Amendment immunity in two intellectual property laws: the Lanham Act, which governs trademark infringement and other forms of unfair competition (No. 98-149), and the Patent Code (No. 98-531).

College Savings Bank (CSB) sells financial products designed to provide sufficient funds to cover the future costs of college education. CSB has patented its method for administering these savings programs. The State of Florida created the Florida Prepaid Postsecondary Education Expense Board (Florida Prepaid) to market and sell tuition-prepayment programs designed to provide sufficient funds to cover the future cost of Florida colleges and universities. CSB sued Florida Prepaid in two separate actions in the same federal district court. In one suit, CSB alleged that Florida Prepaid had infringed its patent. In the other, CSB claimed that Florida Prepaid had engaged in false advertising and unfair competition in violation of Section 43(a) of the Lanham Act, 15 U.S.C. 1125(a).

CSB's Lanham Act complaint alleged that Florida Prepaid had made misstatements about its own savings plans that constituted false advertising and unfair competition. The district court dismissed the case. 948 F. Supp. 400 (D.N.J. 1996). The district court held (1) that Congress's clear statement abrogating Eleventh Amendment immunity for suits under the Lanham Act (see 15 U.S.C. 1122, 1125(a)(2)) was not a valid exercise of power under Section 5 of the Fourteenth Amendment, and (2) that Florida Prepaid had not waived its Eleventh Amendment immunity by voluntarily engaging in business after Congress had expressed its clear intention to make States subject to the Lanham Act.

The Third Circuit affirmed. 131 F.3d 353 (1997). The court of appeals held that "the right to be free from unfair advertising * * * does not amount to "property" within the meaning of the Fourteenth Amendment," so that the Lanham Act was not a valid effort to prohibit the States from depriving citizens of property without due process. Id. at 360. The Third Circuit also held that the doctrine of constructive waiver articulated in Parden v. Terminal Ry. of Alabama State Docks Dep't, 377 U.S. 184 (1964), did not apply because Florida Prepaid was serving a core state function by ensuring that higher education was affordable to all of its citizens. 131 F.3d at 362-365.

In the same opinion that disposed of the Lanham Act case, the district court denied Florida Prepaid's motion to dismiss the patent action on Eleventh Amendment grounds. Florida Prepaid took an immediate interlocutory appeal to the Federal Circuit, which affirmed. 148 F.3d 1343 (1998). The Federal Circuit held that Congress's explicit abrogation of Eleventh Amendment immunity in patent suits (see 35 U.S.C. 271(h), 296(a)) was a valid exercise of its power under the Fourteenth Amendment because patent rights are well-established property rights. Id. at 1349-1350. The Federal Circuit rejected Florida Prepaid's contention that applying the patent laws to the States worked an end run around the Eleventh Amendment because Congress established patent rights by statute and then protected those statutory property rights by subjecting unconsenting States to suit in federal court. That argument had been accepted by the Third Circuit in the Lanham Act appeal, see 131 F.3d at 361, and by a Fifth Circuit panel that upheld Eleventh Amendment immunity from liability under the Copyright Code, see Chavez v. Arte Publico Press, 157 F.3d 282, 289 (1998), rehearing en banc granted (Oct. 1, 1998).

The commercial activities of States inevitably compete with private businesses. This case accordingly is of substantial importance not only to States, but also to businesses that compete with state-owned enterprises or that own intellectual property rights in any field in which States may take a commercial interest.

This Mayer, Brown, Rowe & Maw Supreme Court Docket Report provides information and comments on legal issues and developments of interest to our clients and friends. The foregoing is not a comprehensive treatment of the subject matter covered and is not intended to provide legal advice. Readers should seek specific legal advice before taking any action with respect to the matters discussed herein.

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