Supporting Reversal of an Agency Decision that Requires Owners of an Artificial Water Storage Facility to Operate It as if It Were a Natural Lake

The Flagstaff Storage Project is an artificial reservoir constructed under state legislative mandate for the purpose of regulating the natural flows of the Kennebec River in Maine to enable its use during the entire year in connection with manufacturing and power generation.  Thanks to the operation of the Flagstaff Project and other water storage reservoirs regulating its flows, the Kennebec River is the most productive source of clean, renewable power in the State of Maine.  Despite these facts, the Maine Supreme Judicial Court, in a decision in this case rendered on July 26, 2007, decreed that the Flagstaff Project, an artificial creation, must be operated as if it were a natural water body in that any draw-downs of water in the reservoir must match the ebbs and flows of a natural lake.  Disagreeing with NELF, the Court affirmed the Maine Board of Environmental Protection’s denial of water quality certification for the project.  The Court deferred to and upheld the judgment of the Board that the use of other artificial impoundments as the reference standard for application of state water quality standards, rather than natural lakes, would require advance EPA approval under provisions of the federal Clean Water Act, 33 U.S.C. §§ 1251 et seq., and regulations thereunder.  The decision imposes an operational regime on the Flagstaff Project that is inconsistent with its historical operations and adversely affects beneficial policy goals, including the creation of electricity through the renewable means of hydropower and regulation of the Kennebec River’s flows for other commercial and recreational uses.

Opposing the Extension of Employer Liability under the Massachusetts Maternity Leave Act Beyond the Act’s Eight-Week Maternity Leave Requirement

This case challenged a guideline of the Massachusetts Commission Against Discrimination (“MCAD”) concerning an employer’s liability under the Massachusetts Maternity Leave Act (“MMLA”), G. L. c. 149, § 105D.  The MMLA requires that employees be provided with eight weeks of unpaid maternity leave and reinstatement to their positions at the end of the eight weeks.  The MMLA expressly allows employers to agree to more generous benefits, such as a longer leave period.  An employer who violates the MMLA’s requirement of eight weeks’ leave and reinstatement is subject to extensive statutory remedies, including damages for emotional distress, punitive damages, and reasonable attorneys’ fees.  An MCAD guideline provides that, when an employer agrees to a longer leave period, the statutory remedies will apply in the event of breach of that agreement unless the employer gives advance written notice that full MMLA rights will not apply.   

The plaintiff in this case was terminated from her job after taking a maternity leave of 11 weeks.  The jury found that Global NAPs had violated an agreement that Stephens could take an 11-week leave and, following instructions based on the MCAD guideline, awarded Stephens statutory punitive and emotional distress damages.  In the appeal of this decision, NELF filed an amicus brief on behalf of itself and the Associated Industries of Massachusetts arguing that, by extending the MMLA’s liability provisions to the entire duration of an agreed-upon leave (unless an employer gives advance written notice that the MMLA will not apply), the MCAD guideline contravenes the unambiguous eight-week requirement of the MMLA, discourages the flexibility in private arrangements that the MMLA sought to encourage, and transforms a common law claim for breach of contract into an MMLA violation.   

In a decision rendered on November 8, 2007, the Massachusetts Appeals Court held that the appeal was untimely and, therefore, did not address NELF’s arguments.

Opposing Judicial Expansion of the Scope of the Massachusetts Environmental Policy Act

This case involves Boston University’s proposed bioterrorism laboratory to be sited in Boston. The decision of the Superior Court under review raised two issues of first impression for the Massachusetts Supreme Judicial Court regarding the scope of the environmental impact review process for proposed projects under the Massachusetts Environmental Policy Act, G. L. c. 30, §§ 61 – 62H, (“MEPA”).  The trial court decided that BU’s environmental impact report was inadequate because it failed to address the risk of direct human-to-human contagion and because it did not evaluate alternative, rural site(s).  NELF filed an amicus brief with the SJC, for itself and the Associated Industries of Massachusetts, arguing that MEPA does not apply to impacts on human health unless they arise from an impact on the natural or physical environment, such as air or water pollution, and that MEPA does not contemplate review of alternative sites.  On the first of these issues NELF relied in part on the United States Supreme Court’s interpretation of the federal counterpart to MEPA, the National Environmental Policy Act, 42 U.S.C. §§ 4321-4347.  

In a decision rendered on December 13, 2007, the SJC upheld the trial court, expanding the meaning of the word “environmental” for purposes of MEPA well beyond its scope as previously understood by extending MEPA’s purview to direct public health impacts in the absence of any air or water pollution or other impact on the physical environment giving rise to the perceived health risks.  The SJC’s decision also empowers the state to require that private project proponents evaluate alternative locations for their proposed projects even though the state cannot require a private party to pursue a voluntary project at other than its proposed location.  In a concurring opinion, Justice Cordy acknowledged that the case presented “the temptation to stretch our MEPA statute” with potential “unintended consequences for many projects of a different nature,” since “there are many projects, such as hospitals, clinics, medical laboratories, nursing homes, prisons and even food processing plants,” that pose the risk of human-to-human spread of contagious pathogens. 

Urging Reversal of a Massachusetts Appeals Court Decision that Misapplies the Doctrine of Contract Waiver

In this putative class action a former Putnam employee alleged that he and other similarly situated employees were deterred through intimidation by Putnam from tendering their vested company stock for redemption by the company pursuant to Putnam’s employee equity plan (“Plan”) during specified “window” periods in or about 2002.  The plaintiff complained that, when he thereafter left Putnam’s employ and the company did redeem his vested shares, he received far less for them than he would have received in 2002.  The legal issue in the case was whether the plaintiff had stated a valid claim for breach of contract where the Plan expressly stated that Putnam had no obligation to redeem tendered shares.  The Massachusetts Superior Court dismissed the complaint based on this express reservation of discretion not to redeem tendered shares, but the Massachusetts Appeals Court reversed.  According to the Appeals Court, if the plaintiff could prove that Putnam had consistently redeemed tendered company shares in the past, he might be able to establish that Putnam had waived its expressly stated right under the Plan not to purchase tendered shares.  

The Massachusetts Supreme Judicial Court granted further appellate review and NELF filed an amicus brief for itself and the Associated Industries of Massachusetts arguing that the Appeals Court misapplied contract waiver doctrine.   Contract waiver law deals with a party’s failure to exercise rights in the face of nonperformance by another party; it does not provide that one loses one’s own affirmative, discretionary contract rights by exercising them in a particular fashion.  NELF and AIM argued that the Appeals Court decision was contrary to the express language of the Plan, inconsistent with the concept of an option (as opposed to an obligation), and unsupported by any legal doctrine.  Amici further argued that the Appeals Court decision, were it to stand, would discourage employers from providing equity ownership plans to the disadvantage of both employers and employees.  

In a unanimous decision rendered on December 20, 2007, the SJC agreed with NELF and upheld the trial court judgment, ruling that plaintiff had not stated a claim for breach of express contract or breach of the implied covenant of good faith and fair dealing because, under the plain language of the Plan, Putnam had no legal obligation to purchase tendered shares.  The SJC did not discuss the Appeals Court’s invocation of contract waiver doctrine, apparently agreeing with NELF that the doctrine had no relevance to the case. 

Supporting Construction of Affordable Housing for Massachusetts Workers

In this case the Massachusetts Supreme Judicial Court faced the question whether a local zoning board of appeals, when granting a comprehensive permit for a mixed residential and commercial development containing the requisite below-market-rate units under G. L. c. 40B, §§ 20 - 23, (“Chapter 40B”), may override commercial dimensional zoning requirements otherwise applicable to commercial components of the project.  In a unanimous decision rendered on November 20, 2007, the Court concluded that, when commercial use is permitted on the property to be developed, the local board has this override authority.  

As NELF argued in its amicus brief, a decision to the contrary would have effectively precluded commercial components in a Chapter 40B project even when necessary to render the project economical.  The Court held that allowing “an incidental commercial component under the umbrella of the comprehensive permit provides additional incentives, including economic, to developers to establish affordable housing, and serves to further the development of needed affordable housing.” The Court observed that if the proposed housing development were “a pretext for commercial development,” that would be basis to challenge the comprehensive permit.  In its brief NELF had emphasized the urgent need of the Massachusetts business community for more affordable housing for its work force, noting that Chapter 40B is the multi-family housing option of choice for many local developers.

Supporting Employers' Arbitration Programs

This case before the Massachusetts Supreme Judicial Court raised the question whether an employee may be compelled to arbitrate employment discrimination claims pursuant to a pre-dispute, written arbitration agreement where the employee argues that she did not knowingly and voluntarily agree to waive her right to a jury trial.  A decision adopting St. Fleur’s proposed “knowing and voluntary” defense would have threatened the enforceability of arbitration policies adopted by employers throughout Massachusetts.  NELF filed an amicus brief arguing that the Federal Arbitration Act, 9 U.S.C. §§ 1 et seq., (“FAA”) expressly limits courts to considering generally applicable contract defenses when determining the validity of arbitration agreements and preempts any state law that would impede their enforceability.  Therefore, NELF argued, St. Fleur’s proposed “knowing and voluntary waiver” standard is preempted.  NELF further argued that the FAA preempts the attempt by St. Fleur and the Superior Court to import into Massachusetts law a heightened standard of scrutiny that derives from language unique to the 1991 Civil Rights Act and applies at most to agreements to arbitrate certain federal employment discrimination claims.  

In a unanimous decision issued on January 4, 2008, the Court agreed with NELF that the FAA permits invalidation of arbitration agreements only where the challenging party can prove a generally applicable contract defense under state law, such as fraud, duress, or unconscionability, and remanded the case to the Superior Court for an evidentiary hearing to determine whether St. Fleur was fraudulently induced to enter into the arbitration agreement. 

Arguing that a Class-Action Waiver in an Employer’s ADR Program Requiring Arbitration of Claims under the Fair Labor Standards Act Cannot be Held Per Se Unconscionable

NELF filed an amicus brief on behalf of itself and the Associated Industries of Massachusetts in this class-action lawsuit before the U.S. Court of Appeals for the First Circuit.  NELF asserted that the U.S. District Court for the District of Massachusetts erred by effectively adopting a per se rule that, under Massachusetts law, a class-action waiver in an employer’s ADR program for claims under the Fair Labor Standards Act, 29 U.S.C. §§ 201 et seq., (“FLSA”) is unconscionable.  NELF argued, inter alia, that the District Court’s decision undermined the desirability and utility of ADR programs for the resolution of employment disputes and might, if affirmed, discourage employers from adopting such programs to the detriment of employers, employees, and the courts.  

In its November 19, 2007 decision in the case the First Circuit agreed with NELF that, under Massachusetts contract law, there must be a case-specific factual inquiry to invalidate as unconscionable a class-action waiver in an employer’s arbitration policy for FLSA claims.  Based on the particular facts presented, the First Circuit upheld the decision of the lower court striking the class-action waiver at issue as unconscionable.  The Court expressly declined to reach the employees’ argument that all waivers of class actions for FLSA claims are per se invalid as violative of the FLSA or public policy.

Opposing Biased Land-Use Determinations

NELF and co-amicus National Association of Industrial and Office Properties, Massachusetts Chapter, filed a brief with the U.S. Supreme Court in support of the grant of certiorari in this case. The case involved the appropriate standard for review of government conduct in connection with land-use determinations challenged as violations of the substantive due process protections of the Fifth and Fourteenth Amendments to the United States Constitution.  Mongeau alleged that the respondent Commissioner of Inspectional Services for the City of Marlborough, Massachusetts, was biased against Mongeau for refusing to make a voluntary payment in exchange for permission to build and treated Mongeau’s building permit application and site permit review in a hostile and cavalier manner leading to excessive delays and a predetermined outcome.  There is a split in the circuits, with the U.S. Courts of Appeals for the First and Third Circuits requiring proof of government conduct that “shocks the conscience” before a property developer can prevail on a land-use-related substantive due process claim.  As NELF argued in its brief, this standard not only conflicts with that adopted by a majority of the federal Courts of Appeals, it also conflicts with that utilized by many state courts, including state courts within the First and Third Circuits.  NELF argued that this conflict allows forum shopping and runs contrary to the fair administration of justice.  Moreover, the test adopted by the First and Third Circuits imposes a burden that is virtually impossible to meet on those seeking redress from the courts for civil rights violations and contravenes the Court’s own substantive due process jurisprudence in land-use cases.  On January 19, 2008, the Supreme Court denied Mongeau’s petition for certiorari.