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Emotional Distress Damages for Disability Bias on Tap at SCOTUS

July 8, 2021, 10:00 AM

The U.S. Supreme Court will clarify next term whether victims of disability discrimination under federal law can win emotional distress damages, after it granted review of a Fifth Circuit decision.

“Emotional distress” damages are intended to compensate people for intangible injuries, such as humiliation or embarrassment, that don’t have a readily assignable economic value.

The Fifth Circuit recently diverged from another federal appeals court over whether those damages are allowed in lawsuits brought for violating the antidiscrimination provisions of the Rehabilitation Act and the Affordable Care Act.

Contrary to the U.S. Court of Appeals for the Fifth Circuit, the Eleventh Circuit has held that emotional distress damages are available for violations of Section 504 of the Rehabilitation Act.

It’s “absolutely appropriate” for the nation’s top court to hear the case, given the circuit split, said Matthew Dietz, litigation director of the Disability Independence Group in Miami. Dietz represented the plaintiff in the Eleventh Circuit case.

High court review could right a decision that the petitioner’s attorney, Andrew Rozynski, believes is wrong as a matter of case law and common sense. Rozynski is co-director of the Eisenberg & Baum Law Center for the Deaf and Hard of Hearing in New York.

An attorney for Premier Rehab, the respondent, didn’t respond to Bloomberg Law’s request for comment.

‘Consequential’ Decision

The Supreme Court’s decision will be consequential, said Mary Crossley, who teaches health law policy at the University of Pittsburgh Law School in Pittsburgh.

The case is premised on alleged intentional discrimination in violation of Section 504 and Section 1557 of the Affordable Care Act. Section 504 prohibits recipients of federal funds from discriminating against people with disabilities. Section 1557 extends those protections to discrimination in health programs.

A holding that emotional distress damages may be awarded under those laws likely would encourage more people to bring disability discrimination suits, Crossley said. But a ruling shutting down this avenue of relief would “have significant negative effects,” as it would discourage new cases, she said.

Either way, the decision will have ramifications for other antidiscrimination laws, which—like Section 504 —were designed to protect against the “dignitary harms” discrimination causes, Crossley said.

Emotional pain and humiliation usually are central injuries alleged in discrimination claims, and there often aren’t economic damages, Dietz said. Thus, absent damages to compensate for intangible injuries, the discrimination laws would be ineffective, he said.

Upholding the Fifth Circuit’s decision would make the disability discrimination law “toothless and meaningless,” Rozynski said.

Flat-Out Denial of Accommodation

Jane Cummings’ doctor referred her to the “best rehabilitation clinic in the area,” Premier Rehab, for treatment of her chronic back pain. Cummings, who is deaf, made an appointment.

But Premier Rehab refused Cummings’ request for an American Sign Language interpreter, and she wasn’t able to get treatment there, she alleged.

Then it happened again, after another doctor referred Cummings to the same provider.

This time, Cummings sued for intentional disability discrimination under Section 504 and Section 1557. A trial court dismissed her complaint on the ground that the emotional distress damages she sought aren’t available under the those laws.

The Fifth Circuit affirmed, and the Supreme Court agreed July 2 to hear the case.

According to Rozynski, the Fifth Circuit’s decision is “a complete outlier.”

It’s inconsistent with other cases brought under the Rehabilitation Act and Title VI, the law on which the Rehabilitation Act is patterned, he said. Title VI prohibits recipients of federal money from discriminating on the basis of race, color, and national origin.

Title VI’s remedies—including an implied right of action that allows private parties to sue for violations—have been incorporated into the Rehabilitation Act, the ACA, and laws such as Title IX, which prohibits sex discrimination in educational programs that receive federal funding, Rozynski said.

Contract-Style Damages

Title VI is analogous to a contract in which recipients of federal money agree not to discriminate in return for getting the funds, the Supreme Court held in Barnes v. Gorman.

Courts can award “any appropriate relief” for violations of federal laws for which Congress hasn’t specified a remedy, the Supreme Court said in Barnes. But the remedy must be one the recipient knows it could be exposed to if it breaches its “contract,” the court said.

Because punitive damages traditionally aren’t awarded in contract actions, punitive damages aren’t available under Section 504, the Supreme Court said.

The Fifth Circuit adopted this reasoning. Premier Rehab wasn’t on notice that its alleged Rehabilitation Act violation could expose it to emotional distress damages because they usually aren’t awarded for breach of contract, it said.

The Eleventh Circuit held the opposite in Sheely v. MRI Radiology Network PA. It’s “fairly obvious” that people frequently suffer emotional distress when they experience discrimination, it said. Thus, emotional distress is a “foreseeable” result of a funding recipient’s breach of contract, it said.

Crossley agreed, and suggested how the Supreme Court might distinguish Barnes. Punitive damages, like those at issue in that case, are designed to punish outrageous conduct, she said. Emotional distress damages, by contrast, are compensatory in nature. Like contract damages, they’re meant to make the plaintiff “whole,” she said.

There’s already a high bar for people with disabilities to win compensatory damages, Dietz said. They must show the discrimination was intentional—that is, that the defendant was “deliberately indifferent” to their needs.

Absent emotional distress damages, there’s no remedy, Dietz said.

Eisenberg & Baum LLP and Stanford Law School Supreme Court Litigation Clinic represent Cummings. Watson, Caraway, Midkiff & Luningham LLP represents Premier Rehab.

The case is Cummings v. Premier Rehab Keller PLLC, U.S., No. 20-219, review granted 7/2/21.

To contact the reporter on this story: Mary Anne Pazanowski in Washington at mpazanowski@bloomberglaw.com

To contact the editors responsible for this story: Rob Tricchinelli at rtricchinelli@bloomberglaw.com; Nicholas Datlowe at ndatlowe@bloomberglaw.com

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