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From Banking and Finance Law Daily, December 29, 2015

Ninth Circuit slaps judge’s wrist over seating suit’s second dismissal

By Richard A. Roth, J.D.

Claims by two former bank tellers that Bank of America violated California law by refusing to allow them to sit down when their duties permitted were not preempted by the National Bank Act, the U.S. Court of Appeals has ruled in a not-for-publication opinion. Noting that this was the second time the district court judge’s dismissal of the suit has been reversed, the appellate court took the unusual step of ordering that the case be assigned to a different judge (Green v. Bank of America, Dec. 18, 2015).

State rules. The former tellers claimed that B of A violated California Industrial Welfare Commission Wage Order 7-2001, which provides that:

(A) All working employees shall be provided with suitable seats when the nature of the work reasonably permits the use of seats.

(B) When employees are not engaged in the active duties of their employment and the nature of the work requires standing, an adequate number of suitable seats shall be placed in reasonable proximity to the work area and employees shall be permitted to use such seats when it does not interfere with the performance of their duties.

Preemption rationale. The district court judge decided that the order would not be preempted if it applied to wages and hours, as that would make it similar to the Fair Labor Standards Act, with which national banks must comply. However, a seating requirement regulates working conditions, which is much more burdensome to the business of banking, the judge said. That meant the order was preempted (see Banking and Finance Law Daily, May 31, 2013).

His opinion did not offer any details on how permitting tellers to sit would interfere with the bank’s exercise of powers granted to it by federal law.

No preemption. The Ninth Circuit pointed out that the NBA preempts state requirements that interfere with banking-related functions, and there was no indication of how a seating requirement did that. At most, the wage order would “have an incidental impact on some general business operations,” but that was not enough to call for its preemption.

Reassignment reasons. The appellate court then added that the trial judge had “wrongly dismissed this case twice,” so that the former tellers had not been able to go any farther than their initial complaint in more than four years. Under the circumstances, “we conclude that if this case were before the district judge for a third time he would have substantial difficulty in putting his previously expressed views out of his mind.” Efficiency and “the appearance of justice” required that the case be moved to another judge.

The case is No. 13-56023.

Attorneys: James F. Clapp (Dostart Clapp & Coveney, LLP) for Rhonique Green and Olivia Giddings. Matthew Kane (McGuireWoods LLP) for Bank of America, NA, and Bank of America Corporation.

Companies: Bank of America Corporation; Bank of America, N.A.

MainStory: TopStory BankingOperations CaliforniaNews Preemption

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