MARSHALL LAW
Rather, Letterman, and Minnesota Employment Law
“Imagine a congress of eminent celebrities ...
the result would be an Encyclopedia of Error.”
British Lord Acton (1881)
By Marshall H. Tanick
Journalist Dan Rather and late-night talk show host David Letterman share a few common features.
- The two superstars are household names;
- They have anchored, literally and figuratively, CBS television network programming for years;
- They both have been involved recently in high-profile legal matters.
But neither celebrity has much association with Minnesota. Rather was a keynote speaker in mid-October at the annual dinner for Planned Parenthood of Minnesota and the Dakotas. But, apart from that brief appearance, neither he nor Letterman and their legal imbroglios have much bearing upon Minnesota. Or do they?
Both are engaged in legal travails. Rather's is seemingly coming to an efficient conclusion, while Letterman's has gotten off to a noisy start. Their legal imbroglios, one nearly ending and one just beginning, may impart some lessons to lawyers and litigants involved in workplace disputes in this state.
Rather Ruling
Rather spent nearly 44 years, most of his professional career, as a CBS newsman. He was best known for his stint as the anchor of the network’s nightly newscast, a position he held for about 25 years, after succeeding the legendary Walter Cronkite in 1982, along with sundry other duties.
But his tenure came to an abrupt end when he resigned in the wake of an investigation of a problematic program that he anchored during the 2004 Presidential campaign casting doubt about President Bush’s activities in the National Guard. Greeted with a wave of criticism, CBS conducted a so-called independent investigation that faulted the program. The rebuke caused Rather to step down as anchor, later resigning from his other functions as well.
More than two years ago, Rather sued CBS, asserting a variety of claims, including breach of contract, fraud, breach of fiduciary duty, and other wrongdoing. A trial judge in New York City threw out some of his claims, while maintaining others.
Both parties appealed and, at the end of September, the New York intermediate appellate court issued a ruling that sunk the ex-anchor. In Rather v. CBS Corp., 2008 WL 6864421 (N.Y. Sept. 2009), the tribunal affirmed the trial judge’s dismissal of some of the claims and reversed the lower court decision upholding Rather's other claims. Rather than going to trial, none of Rather's claims was actionable and the “complaint [was] dismissed in its entirety.”
Minnesota Matters
Although decided under New York state law, Rather’s case illustrates some matters that are equally applicable in Minnesota workplace litigation. One major failing of Rather’s pursuit was that he quit his job. In Minnesota, and most other jurisdictions, quitters are generally resigned to lose in litigation.
They usually resort to the doctrine of “constructive discharge” in order to sustain a claim. But that doctrine has not been friendly to employees over the years since its inception in the early 1980's.
Over the years, its criteria have been elevated, making it much more difficult for employees to prevail if they quit. Under current Minnesota law, to prevail in a constructive discharge case, an employee must establish “intolerable” work conditions that would cause a “reasonable” person to quit and, to make matters more difficult, the employee must show that the employer intentionally created that hostile environment for the purpose of inducing the employee to resign. E.g. Navarre v. South Washington County Schools, 652 N.W.2d 9, 32 (Minn. 2002). Few employees are able to meet this high standard.
While Rather’s case was thrown out by the Appellate Court, he has one last chance, albeit a long shot, as he would in Minnesota, too. He can seek review by the state Court of Appeals, the highest branch of the New York legal system. But that tribunal, like its Supreme Court counterpart in this state, has discretion over which cases it hears and accepts only a small number of cases. In Minnesota, Rather’s chances of securing Supreme Court review would be about 14%, the rate of acceptance of non-criminal cases, based upon patterns from recent years. His likelihood of obtaining another appeal is no greater in the more congested New York court system.
Rather’s unsuccessful claim of breach of fiduciary duty also would probably meet the same fate in Minnesota, where employees have a fiduciary duty to employers to avoid detrimental conduct to the employee’s interest but, in stark disparity, employers owe no fiduciary duty to their employees. See Seifert v. Todd, 1999 WL 1903, at *2 (Minn. App. 1999); Rothmeier v. Inv. Advisers, Inc., 556 N.W.2d 590, 594 (Minn. App. 1996).
Another feature of the Rather fracas is its high cost. Rather estimated, by his own account, that he spent about $2 million on the lawsuit, although CBS gloatingly explained that, after its appellate court triumph, that the tab is closer to $5 million.
It’s hard to image workplace litigation in Minnesota reaching that total in light of the bloviated hourly rates of attorneys in New York. But it’s inescapable that workplace litigation is expensive, with most seriously-contested litigation costing in the $100,000 range and often much more.
Letterman Liaisons
The Letterman brouhaha stems from his sexual liaisons with staff members on his late night talk show. Revelation of the affairs came about after Letterman was subjected to a $2 million extortion demand (the same amount as Rather's estimated legal fees) by a producer on another CBS show, who was then charged with attempted larceny and promptly fired. The People of the State of New York v. Halderman, 2009 WL 3163223 (Oct. 2, 2009). The criminal case was brought in the same New York state court system where Rather’s case had been dismissed two days earlier.
While the criminal case plays out its course, Letterman's admitted sexual encounters raise a number of potential civil employment law issues, which evokes interest in how those questions might be addressed in Minnesota.
The behavior of the comedic host of “The Late Night Show,” which he has hosted on CBS since 1992 after long stints on similar morning and night programs on NBC, could launch a lot of litigation. The affairs seemingly were consensual, but as seasonal lawyers know, what starts out as a consensual affair can often turn into something more contested, especially if the relationship ends poorly.
The women could make claims of quid pro quo sex harassment, asserting that they were implicitly required to participate in the affairs in order to secure their positions or promotions or avoid losing their jobs. Alternatively, there could be claims of retaliation if they feel they were treated adversely after the affairs ended.
The statutes of limitations could become obstacles to such claims. In Minnesota, the limitation period is one year under the state Human Rights Act, Minn. Stat. § 363A.28 and 300 days under the parallel provision of Title VII of the Federal Civil Rights Act, 42 U.S.C. §2000e-S(e)(1). While claims relating to the affairs themselves would seem to be untimely, post-affair retaliation claims might still spring up and may be timely.
An obstacle to suits against CBS is that Letterman was not an employee of the network; his program is distributed by his own company, World Wide Pants.
However, in Minnesota and many other jurisdictions, a business can be liable for sexual harassment committed by a third-party, the sub-contractor, vendor, or even customer, if the company knows, or has reason to know, of the wayward behavior. Since it has been reported that Letterman's proclivities were widely known internally, CBS could still be on the hook for any such claims even though it may not have had an employment relationship directly with him. Letterman himself, as an individual, might be liable under an aiding and abetting theory under both Federal and State harassment laws. 18 U.S.C. § 2; Minn. Stat. § 169A.78.
CBS also could try to fend off liability on several other grounds, recognized under Federal law and adopted in Minnesota, too. Last year, following Federal precedent, the Minnesota Supreme Court held that an employer is generally not liable for the misconduct for sexual harassment by an employee unless the employer fails, after actual or constructive notice, to take adequate and timely action. Frieler v. Carlson Marketing Group, Inc., 751 N.W.2d 558 (Minn. 2008). This usually means some type of investigation and, if warranted, disciplinary action.
But Letterman was not just any employee, he was the boss. In Minnesota, under the Frieler case, and under Federal law as well, companies can be vicariously liable for supervisorial harassment. Burlington Indus., Inc. v. Ellerth, 524 U.S. 742 (1998).
But management can defeat such a claim by showing that the employee did not follow prescribed protocols of any sex harassment policy, including complaining in a timely manner. This tenet recognized by case law in both Federal and state cases, encourages employers to adopt sex harassment protocols and for employees to follow them.
There is another potential legal claim that could arise out of the Letterman brouhaha. The details of the contact between his company, World Wide Pants, and CBS are not known. But most agreements have some type of so-called “morals” clause, which generally allows termination for bad behavior by an employee that brings a business into disrepute, the type of provision that resulted in the separation of radio and TV talk show host, Don Imus, from his microphone a couple years ago when he made misogynistic, racist remarks about the Rutgers women’s basketball team. A measure of this type could be applied under Minnesota law if CBS were to yank Letterman’s position.
But that is unlikely, especially in light of Letterman’s soaring ratings. During the week that his sex escapades were revealed, he scored his highest viewer popularity, besting his late night competition by leaps and bounds.
Although his ratings are high, litigation could be looming. If it were, Letterman’s fate might be adjudicated along lines consistent with the principles of Minnesota jurisprudence.
Rather and Letterman are distant from Minnesota. But the legal principles that govern their celebrity situations are not so remote from the laws in this state.
