Business/Government Litigation - Parks Chesin & Walbert
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Whistleblower Update: Court of Appeals Focuses on Pretext before Prima Facie Case.

The Court of Appeals’ most recent decision in Tuohy v. City of Atlanta further clarifies the standard for bringing a claim under the Georgia Whistleblower Act (“GWA”), O.C.G.A. § 45-4-1. 771 S.E. 2d 501 (2015). In Tuohy, the former Atlanta City Treasurer brought suit against the City of Atlanta, Mayor Kasim Reed and the Atlanta City Council (collectively “the City”) alleging that he was terminated in retaliation in violation of the GWA. Specifically, Tuohy alleged that he was retaliated against for objecting to performing improper illegal financial transactions. The trial court granted summary judgment in favor of the City and Tuohy appealed. The Court of Appeals affirmed on the grounds that Plaintiff failed to show that the nondiscriminatory reason given by the city for his termination was pretextual.


Court of Appeals Distinguishes Between “Tiers” of Immunity for School Districts

The Court of Appeals recently clarified that a Georgia Statute waiving sovereign immunity for certain local government entities – O.C.G.A. § 33-24-51(b) – creates a two-tiered analysis under which the first tier explicitly excludes School Districts from a waiver, while the second tier waives immunity for School Districts. See Tift Cnty. Sch. Dist. v. Martinez, No. A14A1988, 2015 WL 1260071 (Ga. Ct. App. Mar. 20, 2015).


Eleventh Circuit’s Limitation on Enforceability of Non-Recruitment Covenants

Restrictive covenants seek to restrict a former employee’s ability to compete (non-compete covenants), to solicit customers or patients (non-solicitation covenants), to solicit co-workers (non-recruitment covenants), or to use or disclose confidential information (non-disclosure covenants). A non-recruitment covenant requires employees to covenant that they will not solicit or hire away employees of the employer. This protects the employer’s investment in the development of its employees. In a recent case discussing the enforceability of a non-recruitment covenant under Georgia common law, the Eleventh Circuit affirmed the trial court’s finding that the non-recruitment covenant was unenforceable.


Charging Orders May Be Issued Against Member Interest In Non-Party LLCs

The Court of Appeals of Georgia recently issued a decision affecting judgment creditors’ rights to collect against the members of an LLC. In acknowledging the issue as one of first impression, the Court ruled that Superior Courts may enter judgment against an individual, thereafter enter charging orders against that individual’s member interests in limited liability companies (“LLCs”), even when those LLCs are not parties to the case and not subject to the Court’s jurisdiction.  A charging order allows a creditor to divert LLC distributions payable to a member (the debtor), without conferring upon the creditor an interest in the LLC itself.  In that sense, the charging order functions almost as a garnishment.


Quantum Meruit Is Available Even If Not Requested

The Court of Appeals held in a recent decision that contractor’s complaint against homeowners for failure to pay contractor for house renovation was sufficient to raise claim of quantum meruit in addition to a claim for breach of contract. One Bluff Drive, LLC v. K.A.P. Inc., 2015 WL 653667. After a jury trial, Appellant/Defendant appealed the verdict in favor of contractor for breach of contract and quantum meruit.


AGs Office Considers Appeal in Class Action

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     By Kathleen Baydala Joyner


The state attorney general’s office is deciding whether to appeal a judge’s decision to allow a potential class action to move forward against the Georgia Department of Community Health in which a government employee alleges she was duped into buying a more expensive health insurance plan.



Health Care

Ruling in favor of the Plaintiff, who is represented by Parks, Chesin & Walbert, along with co-counsel, Fulton County Superior Court Judge Cynthia D. Wright rejected the Attorney General’s contention that the Georgia State Health Benefit Plan (the “Plan”) is immune from suit. Order (D) 2014.10.09 Def’s Motion to Dismiss.  The Plan is administered by the Defendant Department of Community Health (“DCH”), and it provides health care coverage to hundreds of thousands of state employees, teachers and administrators of the State’s local public school systems.  The Court found the Plaintiff can sue DCH for breach of contract for failing to provide the benefits it promised once it accepted premiums from its members for enhanced levels of coverage under the Plan.