Sam A. Virciglio v. Work Train Staffing LLC

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[DO NOT PUBLISH]

IN THE UNITED STATES COURT OF APPEALS

FOR THE ELEVENTH CIRCUIT

________________________

No. 15-10421

________________________

D.C. Docket No. 2:12-cv-03738-AKK

SAM A. VIRCIGLIO,

Plaintiff–Appellee,

versus

WORK TRAIN STAFFING LLC,

WORK TRAIN USA LLC,

FRANK PETRUSNEK,

Defendants–Appellants.

________________________

Appeal from the United States District Court

for the Northern District of Alabama

________________________

(December 30, 2016)

Before ROSENBAUM and JULIE CARNES, Circuit Judges, and GOLDBERG, *

Judge.

*

Honorable Richard W. Goldberg, United States Court of International Trade, sitting by

designation.

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JULIE CARNES, Circuit Judge:

Plaintiff Sam Virciglio was fired from his job and thereafter sued his

employer for retaliation, in violation of the Age Discrimination in Employment

Act (“ADEA”) and Title VII, and for failure to notify Plaintiff of his rights under

the Comprehensive Omnibus Budget Reconciliation Act (“COBRA”). The district

court granted summary judgment to Plaintiff on the COBRA claim and a jury

found for him on the retaliation claim. Thereafter, the district court entered

judgment consistent with its earlier ruling and with the jury’s verdict. Defendants

now appeal this judgment. After careful review of the record, and with the benefit

of oral argument, we affirm.

BACKGROUND

I. Factual Background

This case arises out of Plaintiff’s employment with and subsequent

termination from Defendants Work Train USA and Work Train Staffing

(collectively, “Work Train” or “Defendants”).1 Work Train is in the staffing

business. It earns revenues by hiring staffing employees whom it then uses to

provide services to Work Train clients and by claiming federal tax credits for its

hiring of these staffing employees. Defendant Petrusnek is one of the owners of

1

Work Train USA and Work Train Staffing are related entities. Plaintiff was hired to work for

Work Train USA. He was ostensibly transferred to the employment of Work Train Staffing in

February 2011, but there is evidence that Work Train USA continued to provide certain benefits

to Plaintiff, and likewise to benefit from his employment.

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Work Train. He hired Plaintiff in September 2010 as a sales manager for Work

Train. In addition to a salary, Plaintiff’s compensation included employer-paid

health insurance with family coverage through Blue Cross Blue Shield.

According to Defendants, Plaintiff failed to meet sales expectations during

his first year of employment. As a result, in November 2011, Defendants changed

Plaintiff’s compensation to a commission-based system and informed him that he

would have to start paying the full premium for his health insurance in January

2012. Defendants also assigned Plaintiff a monthly sales quota, effective

immediately.

Plaintiff failed to meet his December 2011 sales quota, and he took leave

during the last few days of that month to spend time with his wife, who was

terminally ill and being treated for cancer. When Plaintiff returned to work on

January 3, 2012, Petrusnek met with him to discuss his performance and to

determine whether Plaintiff was anticipating any upcoming sales. Plaintiff claims

that he gave Petrusnek a letter during the January 3 meeting accusing Defendants

of age and gender discrimination.

On January 4, 2012, the day after his meeting with Petrusnek, Plaintiff filed

an EEOC charge alleging gender discrimination. Two days later, on January 6,

2012, Petrusnek met with Plaintiff again and this time fired him, allegedly for

performance reasons. Construing the facts in favor of Plaintiff, Petrusnek had by

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that date received Plaintiff’s letter alleging age and gender discrimination, but was

not yet aware of Plaintiff’s EEOC charge.

During this January 6 termination meeting, Petrusnek informed Plaintiff that

part of his January 2012 insurance premium had been deducted from his final

paycheck, and that Defendants would pay the remaining portion. Consistent with

this information, Plaintiff’s final paycheck included a $467 deduction for “Health.”

Based on this conversation with Petrusnek, Plaintiff therefore believed he had

insurance coverage through January 2012, and that he did not need to obtain

alternative coverage until February 2012. Defendants never notified Plaintiff,

either during the January 6 meeting or at any other time prior to this lawsuit, of his

right under COBRA to continuation of coverage.

Defendants received notice of Plaintiff’s EEOC charge in mid-January

2012.2 A few weeks later, Petrusnek contacted Blue Cross and requested that

Plaintiff’s health insurance be canceled retroactive to January 1, 2012. Petrusnek’s

request was honored, and Work Train received a refund of $1,904 from Blue Cross

for Plaintiff’s first quarter premium. Defendants did not offer to reimburse

Plaintiff for the $476 part of the premium that had been deducted from his final

paycheck until after Plaintiff filed this lawsuit.

2

Plaintiff subsequently filed two additional EEOC charges, alleging gender, age, and disability

discrimination and retaliation. The second charge was filed on January 31, 2012. It is likely, but

not conclusively established by the record, that Petrusnek received notice of the second charge

before he retroactively canceled Plaintiff’s insurance. Plaintiff’s third charge was filed on March

13, 2012, after his insurance had been canceled.

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Plaintiff’s wife died in March 2012. The following month, Plaintiff learned

that Defendants had retroactively canceled his insurance, which meant he had no

medical coverage for the month of January 2012. Although Plaintiff had

purchased alternative insurance that began on February 1, 2012, he had incurred in

January more than $50,000 in medical expenses, primarily for his wife’s cancer

treatments. These expenses had been initially paid by Blue Cross, but it

subsequently rebilled Plaintiff for payment and ultimately sent the billing to

collections. At some point during this litigation, Defendants requested

reinstatement of Plaintiff’s health insurance for January 2012, and the bills were

then paid.

II. Procedural History

After his termination and subsequent discovery of the retroactive

cancellation of his insurance, Plaintiff filed this lawsuit alleging: (1) a violation of

his COBRA notice rights, (2) age and gender discrimination in violation of the

ADEA and Title VII, (3) retaliation in violation of the same statutes; and (4) fraud

and misrepresentation in violation of various state laws. Following discovery, the

parties filed cross-motions for summary judgment.

The district court granted summary judgment to Defendants on Plaintiff’s

age and gender discrimination claims, but found that questions of fact precluded

summary judgment on Plaintiff’s retaliation claims, as well as on some of his state

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law claims. With respect to the COBRA claim, the court granted summary

judgment to Plaintiff, finding as a matter of law that: (1) Defendants did not

qualify for the small-employer exception to COBRA; (2) Plaintiff’s termination

was a qualifying event that triggered COBRA’s notice requirement; (3) Defendants

failed to provide the required notice; and (4) Defendants did so in bad faith,

warranting a penalty under COBRA. The court advised Defendants that it would

determine at trial the amount of the penalty to be imposed.

The district court subsequently held a jury trial on Plaintiff’s remaining

claims. At the close of Plaintiff’s evidence, Defendants moved for judgment as a

matter of law, arguing that there was insufficient evidence to support those claims

and further that Defendant Work Train USA was not subject to any liability

because it was not Plaintiff’s employer at the time of his termination. Plaintiff did

not oppose the motion as to his state law claims, and the district court dismissed

those claims. The court, however, declined to enter judgment as to the other

claims, and it submitted the case to the jury.

The jury returned a verdict for Plaintiff based on Defendants’ retaliatory

cancellation of Plaintiff’s insurance and awarded him $75,000 in compensatory

damages. The jury also found that the retaliation was willful under the ADEA,

resulting in an additional $75,000 award to Plaintiff. Finally, it awarded $175,000

in punitive damages under Title VII. For its part, and in accordance with its earlier

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grant of summary judgment to Plaintiff on the COBRA notice claim, the district

court imposed a $3,300 penalty based on that claim. 3 Thus, consistent with the

above verdict and its own ruling, the court entered a judgment that incorporated the

jury’s award of damages against Work Train in the amount of $325,000, in

addition to the court’s award of a penalty against Defendants Work Train and

Petrusnek in the amount of $3,300 for the COBRA notice claim.

Defendants appeal the judgment entered against them. They argue that the

district court erred by: (1) allowing Plaintiff to amend his complaint after the

scheduling order deadline to add a COBRA notice claim, (2) denying Defendants’

Batson challenge during jury selection, (3) denying Defendants’ motion for

judgment as a matter of law as to Plaintiff’s retaliatory cancellation claim and as to

Defendant Work Train USA’s liability on that claim, (4) refusing to give

Defendants’ requested jury instruction concerning “but for” causation, and (5)

entering judgment in favor of Plaintiff on his COBRA notice claim.

DISCUSSION

I. COBRA Amendment

The scheduling order set a deadline of May 30, 2013 for amending the

pleadings. On June 14, 2013, which was about two weeks after the deadline

3

Under 29 U.S.C. § 1132(c) and 29 C.F.R. § 2575.502c-1, COBRA penalties are imposed at the

discretion of the court, with a potential penalty of up to $110 for every day the statute was

violated.

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expired, Plaintiff filed a motion for leave to amend the complaint to add the

COBRA notice claim on which he ultimately prevailed at summary judgment.

Defendants argue that the district court erred by granting Plaintiff’s motion and

allowing the amendment.

Federal Rule 16(b) allows an amendment outside the date specified in the

scheduling order “for good cause and with the judge’s consent.” Fed. R. Civ. P.

16(b)(4). The district court consented to Plaintiff’s amendment, finding good

cause for the delay because Plaintiff did not learn until his deposition on June 12,

2013 that Defendants had in fact purchased insurance for him in January 2012

(before retroactively cancelling it) and that he was thus arguably a covered

employee entitled to COBRA notice at the time of his termination.

We review the district court’s good cause finding for an abuse of discretion.

Sosa v. Airprint Sys., Inc., 133 F.3d 1417, 1418 (11th Cir. 1998). There clearly

was no abuse of discretion here. The record shows that in spite of his diligence,

Plaintiff did not have the information necessary to assert a viable COBRA notice

claim until after the amendment deadline expired. See id. at 1419 (noting that

diligence is required to support a good cause finding). It was thus within the

court’s discretion to allow the amendment.

II. Batson Challenge

Following voir dire, Plaintiff used each of his three peremptory strikes to

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remove white males from the venire panel. Defendants challenged the strikes

under Batson v. Kentucky, 476 U.S. 79 (1986) and its progeny, which prohibit the

use of peremptory strikes to exclude jurors based on race or gender.4 See J.E.B. v.

Alabama ex rel. T.B., 511 U.S. 127, 130–31 (1994) (reaffirming that Batson

prohibits discrimination on the basis of race, and extending its holding to gender-

based strikes). After conducting a Batson hearing, the district court expressed

serious doubt that Defendants had even made a prima facie case of discrimination

against white males, 5 given that six white males were left after the peremptory

strikes to serve on the jury of eight. Indeed, based on the numbers provided during

the Batson hearing, white males, who represented only 64% of the venire panel,

constituted 75% of the jury that was actually selected. Even assuming a prima

facie case, the court found, in the alternative, that Plaintiff articulated race and

4

It should be noted that Defendants used each of their three peremptory strikes to remove black

females from the venire panel. Plaintiff challenged these strikes under Batson, but the district

court rejected his challenge, just as it rejected Defendants’ challenge of Plaintiff’s strikes.

Plaintiff has not filed a cross-appeal based on Defendants’ use of all of their strikes against

women and black jurors.

5

Defendants conflate race and gender in their focus on Plaintiff’s strike of “white males.” For

simplicity’s sake, we use the same term because, as it happens, the three whites struck by

Plaintiff also were male. But in doing so, we suggest no endorsement of a hyphenated category

of protected status under Batson that could be created by combining into sub-sets the potential

groupings of race and gender in a particular jury venire. See United States v. Walker, 490 F.3d

1282, 1291 n.10 (11th Cir. 2007) (“The Supreme Court has not yet ruled whether constitutional

protections afforded to race-based groups in Batson, and gender-based groups in J.E.B. v.

Alabama ex rel. T.B., extend to combined race-gender groups.”). And although for analytic

purposes we assume that we should focus on whether Plaintiff violated Batson either through its

strikes of whites (whatever their gender) or its strikes of males (whatever their race), we find no

Batson error under either approach.

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gender-neutral reasons for the challenged strikes that were sufficient to overcome

any inference of discrimination.

A Batson challenge is governed by a three-step inquiry: (1) first, the party

challenging a strike must make a prima facie case of discrimination, (2) the burden

then shifts to the striking party to offer a permissible race and gender-neutral

justification, and (3) if such an explanation is tendered, the trial court must decide

whether the challenging party has shown purposeful discrimination. Madison v.

Comm’r, Ala. Dep’t of Corr., 761 F.3d 1240, 1242–43 (11th Cir. 2014) (citing

Johnson v. California, 545 U.S. 162, 168 (2005)). The trial court must consider all

of the relevant facts and circumstances in determining whether a party has made a

prima facie case at the first step, or shown purposeful discrimination at the third

step of the Batson inquiry. Id. at 1242, 1251.

We review the district court’s Batson ruling for clear error. Snyder v.

Louisiana, 552 U.S. 472, 477 (2008). The trial court’s findings, on both the prima

facie and the purposeful discrimination prongs, are entitled to deference and a

presumption of correctness. See United States v. Ochoa-Vasquez, 428 F.3d 1015,

1039 (11th Cir. 2005) (“We give great deference to a district court’s finding of

whether a prima facie case of impermissible discrimination has been

established[.]”); Madison, 761 F.3d at 1248 (applying the clearly erroneous

standard to the district court’s ruling on purposeful discrimination).

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The district court did not commit any Batson error here, much less clear

error. Like the district court, we are uncertain that Defendants even established a

prima facie case of discrimination, given that: (1) the case was not racially

charged, and although Plaintiff initially raised an issue of gender discrimination,

Defendants have suggested no plausible reason why, on this record, we could infer

a discriminatory motive based on Plaintiff’s strikes of jurors from his own

protected category (males); (2) there is no evidence of a history of race or gender-

based strikes by Plaintiff’s attorney, or any other evidence that would suggest a

discriminatory motive; and (3) the jury selected contained a higher percentage of

whites (75%) and males (87%) than did the venire (64% white and 71% male). 6

See United States v. Robertson, 736 F.3d 1317, 1326 (11th Cir. 2013) (discussing

various circumstances that are relevant to the first step of the Batson inquiry); Lee

v. Comm’r, Ala. Dep’t of Corr., 726 F.3d 1172, 1224 (11th Cir. 2013) (“That a

predominantly black jury was selected cuts in favor of the . . . conclusion that no

Batson violation occurred.”); United States v. Campa, 529 F.3d 980, 997–98 (11th

Cir. 2008) (finding no prima facie case where the prosecutor used seven out of nine

peremptory strikes against black veniremen, but the jury ultimately included three

6

There were 9 white males, 4 black females, and 1 black male on the venire. Breaking down

the categories separately by race and gender, 9 out of 14 (or 64%) of the venire were white and

10 of 14 (or 71%) were male. The jury included 6 white males, 1 black male, and 1 black

female, meaning that 6 out of 8 jurors were white (75%) and 7 out of 8 (87%) were male. Thus,

the jury selected contained a higher percentage of both males and whites than did the venire from

which they were chosen.

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black members and one black alternate).

But even assuming Defendants established a prima facie case, the district

court did not clearly err in finding that they failed to show purposeful

discrimination. At trial, Defendants challenged Plaintiff’s decision to strike jurors

number 2, 14, and 11. Plaintiff explained each strike as follows: (1) Juror 2 was a

manager who had been involved in terminating employees; (2) Juror 14 was a

CPA, and Plaintiff’s attorney routinely struck CPAs; and (3) Juror 11 was an

insurance agent, which Plaintiff’s attorney believed would make him less favorable

to Plaintiff’s case.

The district court found that these explanations were legitimate and facially

neutral—a decision to which we attribute no error—and moved to the third step of

the Batson inquiry: whether the movant had shown purposeful discrimination. See

Madison, 761 F.3d at 1250 (noting that the reason offered for a strike will be

deemed neutral unless it is inherently discriminatory). Before the trial court,

Defendants did not challenge Plaintiff’s explanations for striking Jurors 11 and 14,

and they do not dispute Plaintiff’s contention that they thereby waived their Batson

argument as to these jurors. Their argument on appeal then is focused only on

Juror 2.

As to Juror 2 (the white male manager who said he had been involved in

terminating employees), Defendants argue that Plaintiff’s asserted reason for

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striking him was not credible because Plaintiffs could just as well have struck Juror

4, a black male who was also a manager. At the Batson hearing, Plaintiff’s

attorney explained that he thought Juror 4 would be more favorable to his case than

Juror 2 because Juror 4 had held the same job for 35 years and thus likely had a

better understanding of the value of keeping a job than Juror 2, who had bounced

from job to job. We find no clear error by the district court in crediting that

explanation, and in concluding that Plaintiff’s decision to strike Juror 2, instead of

Juror 4, was not motivated by purposeful discrimination. See Parker v. Allen, 565

F.3d 1258, 1271 (11th Cir. 2009) (“The prosecutor’s failure to strike similarly

situated jurors is not pretextual . . . where there are relevant differences between

the struck jurors and the comparator jurors.”) (internal quotation marks omitted).

In short, the district court did not err in concluding that Plaintiff’s jury strikes did

not run afoul of Batson.

III. Motions For Judgment As A Matter of Law

At the close of Plaintiff’s evidence, Defendants moved for judgment as a

matter of law pursuant to Rule 50(a). Filing a written motion, Defendants argued

that there was insufficient evidence to support Plaintiff’s retaliation claim. Orally,

Defendants also argued that Defendant Work Train USA could not be held liable

on the retaliation claim because it was not Plaintiff’s employer. The district court

denied Defendants’ motion as to the retaliation claim. The court did not rule on

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the motion concerning Work Train USA, but noted that the issue should have been

raised “long before” trial.

Defendants renewed both motions at the close of their own evidence. The

district court denied the renewed motion as to the retaliation claim. As to Work

Train USA’s liability, the court again noted that the issue should have been

addressed prior to trial on a motion to dismiss. The Court decided to carry the

issue with the case, and submitted the case to the jury without ruling on the motion.

While the jury was deliberating, Plaintiff filed a supplemental brief

identifying record evidence showing that both Work Train USA and Work Train

Staffing were Plaintiff’s employer under a “single employer” or “integrated

enterprise” theory. The district court took Plaintiff’s brief under advisement and

informed Defendants that they could respond to it. Defendants never did so, and

the jury returned a verdict for Plaintiff on his retaliatory cancellation of insurance

claim against “WorkTrain”—a corporate entity that referred jointly to Defendants

Work Train USA and Work Train Staffing.

Not only did Defendants fail to dispute the legal and factual arguments made

by Plaintiff in support of his contention that the two entities constituted Plaintiff’s

employer under a “single employer” theory, but they also chose not to renew their

motion for judgment as a matter of law under Rule 50(b). Nor after the verdict did

they move for a new trial under Rule 59(b). Defendants now belatedly reassert on

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appeal their Rule 50(a) arguments made prior to submission of the case to the jury.

Specifically, Defendants argue that they are entitled to judgment as a matter of law

on Plaintiff’s retaliatory cancellation claim because the evidence was insufficient

to support it, and that Defendant Work Train USA is entitled to judgment on the

claim because it was not Plaintiff’s employer at the time of his termination.

A. Defendants have waived their arguments in support of judgment

as a matter of law.

Defendants’ failure to file a post-verdict motion for judgment or for a new

trial precludes any appeal of the issues asserted in their pre-verdict motion. See

Unitherm Food Sys., Inc. v. Swift-Eckrich, Inc., 546 U.S. 394, 404 (2006). As the

Supreme Court explained in Unitherm: “[d]etermination of whether a new trial

should be granted or a judgment entered . . . calls for the judgment in the first

instance of the judge who saw and heard the witnesses and has the feel of the case

which no appellate printed transcript can impart.” Id. at 401 (internal quotation

marks omitted). Consequently, failure to file a post-verdict motion for judgment or

a new trial “deprives the appellate court of the power to order the entry of

judgment in favor” of the moving party. Id. See also HI Ltd. P’ship v. Winghouse

of Fla., Inc., 451 F.3d 1300, 1302 (11th Cir. 2006) (“Filing a pre-verdict, Rule

50(a) motion for judgment as a matter of law cannot excuse a party’s post-verdict

failure to move for either a JNOV or a new trial pursuant to Rule 59(b).”).

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B. Defendants are not entitled to judgment on the merits.

Even assuming Defendants are entitled to appeal either issue, the district

court did not err by failing to grant judgment as a matter of law. On our review of

the court’s ruling, we view the evidence in the light most favorable to Plaintiff.

See Gowski v. Peake, 682 F.3d 1299, 1310–11 (11th Cir. 2012). Defendants can

only prevail if there was “no legally sufficient evidentiary basis for a reasonable

jury to find” for Plaintiff on the retaliatory cancellation claim or to enter judgment

on the claim against WorkTrain USA. Myers v. TooJay’s Mgmt. Corp., 640 F.3d

1278, 1287 (11th Cir. 2011) (internal quotation marks omitted). That is not the

case as to either of the grounds asserted by Defendants.

1. There is sufficient evidence to support the jury’s verdict that the

cancellation of Plaintiff’s health insurance was retaliatory.

Defendants presented some evidence at trial that Plaintiff’s insurance was

canceled because he failed to pay the full premium for coverage in January 2012,

rather than in retaliation for his discrimination charges. But Plaintiff rebutted this

explanation with evidence that: (1) Petrusnek told Plaintiff during the January 6

meeting that part of the premium had been deducted from Plaintiff’s last check and

that Defendants would pay the other part; (2) the timing of the retroactive

cancellation was suspicious, coming just a few weeks after Petrusnek learned about

Plaintiff’s EEOC charge; (3) Petrusnek did not tell Plaintiff he was cancelling the

insurance or offer to refund the portion of the premium that had been deducted

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from Plaintiff’s last paycheck; and (4) Petrusnek lied to Blue Cross about

Plaintiff’s last day of work, falsely stating that Plaintiff had been terminated at the

end of December 2011 in order to obtain the retroactive cancellation. Based on

this evidence, the jury was authorized to find the cancellation was retaliatory. See

Booth v. Pasco Cty., Fla., 757 F.3d 1198, 1207 (11th Cir. 2014) (“[C]redibility

determinations, the weighing of the evidence, and the drawing of legitimate

inferences from the facts are jury functions, not those of a judge[.]”) (internal

quotation marks omitted).

2. The evidence supports Work Train USA’s liability.

Plaintiff likewise presented evidence at trial that Defendants Work Train

USA and Work Train Staffing each provided certain benefits of employment and

thus operated jointly as Plaintiff’s employer. Particularly relevant to the retaliatory

cancellation claim, Plaintiff’s evidence showed that Work Train USA is the entity

that contracted with Blue Cross for Plaintiff’s insurance benefits at the time of his

termination. In addition, some of Plaintiff’s sales documents contained the

heading Work Train USA, indicating that Plaintiff’s employment and sales were at

least partially for the benefit of Work Train USA, although his salary was paid by

Work Train Staffing. This evidence was sufficient to support a finding that Work

Train USA and Work Train Staffing were joint employers, and thus jointly liable

on Plaintiff’s retaliation claim. See Virgo v. Riviera Beach Assoc., Ltd., 30 F.3d

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1350, 1360 (11th Cir. 1994) (“[T]he joint employer concept recognizes that the

business entities involved are in fact separate but that they share or co-determine

those matters governing the essential terms and conditions of employment.”)

Alternatively, there is evidence that Work Train USA and Work Train

Staffing operated as an “integrated enterprise” equally subject to liability on

Plaintiff’s retaliation claim. See McKenzie v. Davenport-Harris Funeral Home,

834 F.2d 930, 933 (11th Cir. 1987). Four factors are relevant to the “integrated

enterprise” inquiry: (1) the degree of interrelatedness of operations, (2) the degree

of centralized control of labor relations, (3) the presence of common management,

and (4) common ownership or financial control. Lyes v. City of Riviera Beach,

Fla., 166 F.3d 1332, 1341 (11th Cir. 1999). Plaintiff presented sufficient evidence

to consider Work Train USA and Work Train Staffing an integrated enterprise

under these factors, including the exhibits described above. In addition, it is

undisputed that the two entities have common management and owners, and that

they exercise centralized control over their operations from a common home office

in Birmingham, Alabama. Thus, the district court did not err by refusing to grant

judgment as a matter of law to Work Train USA on Plaintiff’s retaliation claim on

the ground that Work Train USA was not Plaintiff’s employer.

IV. Jury Instructions

Defendants argue that the district court erred by failing to instruct the jury

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that “but for” causation is required to prevail on a retaliation claim. See Univ. of

Tex. Sw. Med. Ctr. v. Nassar, 133 S. Ct. 2517, 2528 (2013). We review the district

court’s refusal to give a requested instruction for an abuse of discretion. Pensacola

Motor Sales Inc. v. E. Shore Toyota, LLC, 684 F.3d 1211, 1224 (11th Cir. 2012).

“We will not disturb a jury’s verdict” on this ground unless the instructions, “taken

as a whole, [are] erroneous and prejudicial.” Watkins v. City of Montgomery, Ala.,

775 F.3d 1280, 1290 (11th Cir. 2014) (internal quotation marks omitted).

The district court gave the pattern instruction on causation, advising the jury

that “[t]o determine that WorkTrain took an adverse employment action because of

Plaintiff’s protected activity, you must decide that WorkTrain would not have

taken the action had Plaintiff not engaged in the protected activity but everything

else had been the same.” This instruction incorporated the “but-for” standard of

Nassar and accurately stated the law. It was not erroneous, and certainly not an

abuse of discretion. See United States v. Dominguez, 661 F.3d 1051, 1072 (2011)

(“Because the instructions given by the district court were correct statements of the

law, we find no abuse of discretion in the refusal to give a separate instruction on

specific intent and mistake of fact.”).

V. COBRA Notice Claim

Finally, Defendants argue that the district court erroneously entered

judgment in favor of Plaintiff on his COBRA notice claim. It is undisputed that

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Defendants did not notify Plaintiff, at any time prior to this lawsuit, of his COBRA

right to continuation of coverage. Plaintiff’s judgment on this claim should

therefore be upheld unless Defendants can fit within an applicable exception to

COBRA’s requirements. See 29 U.S.C. §§ 1163(2) and 1166(a)(4)(A) (requiring

the health plan administrator to provide notice of COBRA continuation rights upon

a covered employee’s termination); Wright v. Hanna Steel Corp., 270 F.3d 1336,

1343 (11th Cir. 2001) (noting that the defendant’s “failure under § 1166(a)(4)(A)

to notify the [plaintiff] of continuation coverage meant that [the plaintiff] was

eligible for penalties” under COBRA).

As they did below, Defendants argue that: (1) they are exempt from

COBRA under the “small employer” exception, and (2) Plaintiff’s termination was

not a “qualifying event” under COBRA because Plaintiff was terminated for “gross

misconduct.” Defendants contend further that even if Work Train Staffing was

liable on the COBRA claim, Work Train USA and Petrusnek were not, because

neither was Plaintiff’s employer at the time of his termination.

A. The “small employer” exception does not apply.

COBRA creates an exception from its requirements for employers who

“normally employed fewer than 20 employees on a typical business day during the

preceding calendar year.” 29 U.S.C. § 1161(b). If the staffing workers are counted

along with Work Train’s full-time employees, it is undisputed that Work Train

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employed significantly more than 20 employees on a typical business day during

2011, the relevant calendar year for purposes of Plaintiff’s claim. Although the

staffing workers were outsourced to other job sites, the evidence in the record

indicates that, as defined by COBRA, they remained employees of Work Train.

See 29 U.S.C. § 1002(5), (6) and Nationwide Mut. Ins. Co. v. Darden, 503 U.S.

318, 323–24 (1992) (using traditional agency principles, such as the tax treatment

of and the right to control and direct a worker, to determine his status as an

employee under ERISA).

Work Train was designated as the “sole employer” of the staffing workers in

its client contracts. Pursuant to the contracts, Work Train was responsible for

recruiting, hiring, training, assigning, and supervising all of the staffing workers,

and it expressly retained the right to fire the workers. Petrusnek confirmed in his

deposition testimony that the staffing workers were Work Train employees,

although they were outsourced to other locations, and that Work Train handled

their payroll and taxes. In addition, Work Train held itself out as the employer of

the staffing workers by claiming federal tax credits for them. Given this evidence

indicating that the 2011 staffing workers were Work Train employees, the “small

employer” exception is inapplicable.

B. Plaintiff’s termination was a qualifying event.

Neither is there any evidence to support Defendants’ argument that Plaintiff

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was fired for “gross misconduct” and thus not entitled to continuation of coverage

under COBRA. See 29 U.S.C. § 1163(2) (defining “qualifying event” to include

termination of an employee “other than by reason of such employee’s gross

misconduct”). Instead, all of the evidence suggests that Plaintiff was fired solely

for missing his December 2011 sales quota: a lapse that implicates job

performance, not misconduct. Defendants try to characterize Plaintiff’s decision to

take a few days of leave at the end of 2011 as misconduct, but they do not dispute

that Plaintiff’s leave complied with Work Train’s vacation policy. In fact, Work

Train co-owner Mark George conceded at trial that Plaintiff “had a right to take a

vacation” and that “taking a vacation was not misconduct.”

The parties have not cited any Eleventh Circuit case law interpreting the

term “gross misconduct” as used in COBRA. But we agree with the Seventh

Circuit that it must involve something more than incompetence or unsatisfactory

performance. See Mlsna v. Unitel Commc’ns, Inc., 91 F.3d 876, 881 (7th Cir.

1996) (“job incompetence alone does not constitute gross misconduct for COBRA

purposes”). In short, there is no evidence to suggest that Plaintiff was terminated

for anything other than lackluster sales, which does not qualify as “gross

misconduct” under COBRA.

C. Work Train USA and Petrusnek are liable.

COBRA authorizes the trial court, in its discretion, to impose a penalty of up

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to $110 a day on any plan administrator who fails to meet its notice requirements.

29 U.S.C. § 1132(c)(1). Again, Defendants concede that they did not provide

notice of continuation coverage under COBRA when Plaintiff was terminated, and

the district court correctly concluded that no exceptions to the notice requirement

are applicable. Petrusnek is identified as a plan administrator in Defendants’

sworn discovery responses. In addition, Petrusnek testified at trial that he was a

plan administrator. Thus, the district court did not err by concluding that Petrusnek

was personally liable.

As to Work Train USA, the plan documents specify that “[t]he plan sponsor

and the plan administrator is the employer.” Pursuant to the plan, the term

“employer” has the same meaning as the term “group.” The term “group” is in

turn defined by the plan to include the “organization that has contracted with us to

provide or administer group health benefits pursuant to the plan.” Defendants do

not dispute that Work Train USA contracted with Blue Cross to provide the plan at

issue in this case, as evidenced by the refund issued to Work Train USA following

the retroactive cancellation of Plaintiff’s health insurance. Accordingly, the

district court did not err by entering judgment against Work Train USA on

Plaintiff’s COBRA notice claim.

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CONCLUSION

For the reasons explained above, we find no error in the district court’s entry

of judgment against Defendants on Plaintiff’s retaliatory cancellation of insurance

and COBRA claims. Accordingly, we affirm the judgment.

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