By James L. CurtisKay R. Bonza, and Craig B. Simonsen

Seyfarth Synopsis:  A railcar cleaning company and its executive officers were recently charged in a 22-count indictment with conspiracy, violating worker safety standards resulting in worker deaths, violating the Resource Conservation and Recovery Act (RCRA), and for submitting false documents to a federal agency.

Nebraska Railcar Cleaning Services LLC (NRCS) employees sent workers in to railcars to scrape and remove various commodities from tanker cars, including gasoline, ethanol, petroleum by-products, pesticides, herbicides, and food grade products.  Two of the company’s workers were killed and a third was injured when the contents of a railcar ignited while being cleaned.  According to the indictment, the company, NRCS and its owners and executives, allegedly failed to implement worker safety standards and then tried to cover that up during an Occupational Safety and Health Administration (OSHA) inspection.  The defendants also allegedly mishandled hazardous wastes removed from rail tanker cars during the cleaning process.

OSHA requires employers to test air in confined spaces such as rail tanker cars for hazardous gases prior to allowing employees to enter the confined workspace, and to provide employees exposed to certain chemicals with respirators for which they must be assessed and fit tested.  EPA requires facilities like NRCS to ensure that hazardous wastes generated are properly treated and disposed of.

The indictment alleges that after a 2013 inspection of NRCS, the company represented that NRCS had been testing for hazardous wastes, including benzene, since July 2014.  After OSHA returned to NRCS in March 2015 to conduct a follow-up inspection and was turned away, documents were “created” and submitted to OSHA to “falsely show” that NRCS had been purchasing equipment to test the contents of railcars for benzene and had taken other required safety precautions.  In addition, “during inspections by the Nebraska Department of Environmental Quality and the U.S. Environmental Protection Agency in 2013 and 2014 respectively, NRCS was informed that it was required to test its wastes to determine if they were hazardous in order to properly dispose of them, rather than send all untested waste to a landfill not permitted to receive hazardous waste.”  The indictment alleges that was not done before April 2015.

In April 2015, the contents of a railcar ignited while being cleaned by NRCS employees. Two employees were killed and a third was injured. Two days after the explosion, NRCS had three railcars tested to assess whether their contents were hazardous, and two were determined to be hazardous.

Employer Takeaways

This indictment presents a good example of what not to do when dealing with OSHA and environmental agency inspectors.  First, if the employer represents that it is implementing certain safety measures — do it!  Secondly, the case serves as a reminder of the importance of providing complete and accurate submittals to government entities.  A deliberate falsification can have serious ramifications, both by way of civil penalties and criminal prosecution.  As everyone has learned through countless infamous cases, it’s not the crime but the cover-up that will really come back to bite the employer.

For more information on this or any related topic please contact the authors, your Seyfarth attorney, or any member of the Workplace Safety and Health (OSHA/MSHA) Team.

By Ariel D. Fenster

Seyfarth Synopsis: A case out of the District of Oregon recently dismissed a Plaintiff’s sexual harassment and retaliation claims where the allegations relied on manufactured text messages that Plaintiff failed to produce.

After a break-up, you can’t just fabricate text messages and then sue your former employer. In Lee v. Trees, Inc., the District of Oregon recently dismissed a former employee’s lawsuit, wherein she alleged sexual harassment, retaliation, and wrongful termination. The court dismissed the case when the former employee failed to produce the text messages on which her claims were predicated upon. In Lee, the employee had a consensual romantic relationship with her supervisor. According to the plaintiff, when she sought to end the relationship, she received numerous threats against her job unless she continued the sexual relationship.

After filing administrative complaints with the EEOC and the Bureau of Labor and Industries (BOLI), Lee told the investigators that she had text messages where she asked her supervisor to stop the relationship. Lee said these text messages could prove that after ending the relationship she was fired. Based on paper copies of these alleged text messages, the BOLI issued Notices of Substantial Evidence Determinations and right to sue letters.

During initial disclosures, the employer requested that she provide the text messages “in electronic form in their native format.” The employer also requested that Lee provide her five cell phones (Yes, Five!) that she had during her employment. Lee again only produced paper copies of the texts and only one of her cell phones.

Knowing something was fishy, the employer hired a forensic examiner to review Lee’s cellphone. The forensic examiner determined most of these texts were fabricated and in the drafts box of her cell phone. They were not actually sent! Further, many of the printed texts that Lee submitted were only fragments of longer conversations.

Based on the evidence of falsification, Defendants moved for dismissal and sanctions. The Court determined that this was a spoliation issue. “The majority of courts have held that pre-litigation destruction can constitute spoliation when litigation was ‘reasonably foreseeable’ but not where it was ‘merely’ possible.”

Before imposing the sanction of dismissal, the district court must weight several factors: “(1) the public’s interest in expeditious resolution of litigation; (2) the court’s need to manage its dockets; (3) the risk of prejudice to the party seeking sanctions; (4) the public policy favoring disposition of cases on their merits; and (5) the availability of less drastic sanctions.” Anheuser-Busch, Inc. v. Natural Beverage Distribs., 69 F. 3d 337, 348 (9th Cir. 1995).

In looking at the five factors and deciding to dismiss the case, the Court determined that Lee deliberately deceived the Court and wasted the time and resources of the Court, of the Defendants, and of her own attorneys. Further, Lee obstructed discovery by her continuing failure to produce the text messages in electronic format (which now it seems she could not do in the first place!).

The Court dismissed Lee’s case with prejudice and held any lesser sanction would suggest to future litigants that they may manufacture evidence with impunity and suffer no meaningful consequence if caught.

The lesson for all potential litigants is you will be caught. There is another important lesson for employers as well — and that is to keep evidence. Simply put (and perhaps too simplistically put), sometimes it is not enough to have the paper copy of a document, particularly when the communications were all done electronically. Keeping electronic copies of items (and preserving ESI if there is a reasonably foreseeable threat of litigation) is always safe- you never know what may happen, or who might want to go poking through electronic files .

For more information on this topic, please contact the author, your Seyfarth Attorney, or any member of the Firm’s Labor & Employment Team.