Munsch Hardt Attorney Wins Appeal Against U.S. Department of Labor
July 07 2015 - 9:03AM
Business Wire
Judgment confirms ‘bad faith’ on part of DOL,
additional attorney fees to be awarded for Texas oilfield services
company
The U.S. Department of Labor (DOL) is once again being held
accountable for over-reaching its authority, and acting in ‘bad
faith’ in a wrongful employee misclassification case against Corpus
Christi-based Gate Guard Services, L.P. Today, the Fifth Circuit
Federal Court of Appeals ruled the government’s conduct was
tantamount to bad faith and sufficiently egregious to warrant an
award of attorney fees, under the Equal Access to Justice Act.
In April 2014, the DOL was ordered to pay nearly $600,000 in
attorney fees and expenses to Gate Guard by the U.S. District Court
for the Southern District of Texas Victoria Division. This was a
result of the agency’s wrongful employee misclassification case
against Gate Guard. This week’s appellate ruling upholds that
original ruling, and further declares that attorney fees will be
determined and awarded to Gate Guard “as a sanction for the
government’s bad faith.”
“If an employer is unjustly accused of independent contractor
misclassification by the DOL, this unprecedented ruling will give
them added protection to defend that business model, and will have
wide-ranging implications in sectors that use contractors, such as
the oil and gas and construction industries,” said Daniel
Pipitone of Texas-based Munsch Hardt Kopf & Harr,
who has served as lead counsel on the case since 2011. “Essentially
the DOL is now aware it cannot proceed against business entities
unrestrained, and shall be held financially accountable when it
abuses its powers.”
The case began in 2010 when the DOL investigated Gate Guard for
allegedly wrongly misclassifying its employees as independent
contractors. The company was ordered to pay more than $6.2 million
in fines and back pay, but a significant decision by Federal
District Court Judge John D. Rainey in 2013 ruled in favor of Gate
Guard, dismissing the agency’s enforcement action and validating
the company’s business model and use of independent contractors.
Following that ruling, Gate Guard owner, Bert Steindorf, sued the
government under the Equal Access to Justice Act, to recover
attorney fees.
About Munsch Hardt Kopf & Harr,
P.C.
Munsch Hardt Kopf & Harr, P.C. is a Texas-based, mid-sized
commercial law firm with more than 115 attorneys in Dallas, Houston
and Austin. From corporate transactions to dispute resolution,
Munsch Hardt provides wide-ranging legal expertise to its clients,
navigating each step with in-depth knowledge and responsive action.
Munsch Hardt attorneys are known for having large law firm
backgrounds and providing clients with a personal and focused
approach. Practice groups include Admiralty & Maritime;
Business Litigation; Construction; Corporate & Securities;
Energy; Environmental; Finance; Franchise; Health Care;
Immigration; Insurance; Intellectual Property; Labor &
Employment; Real Estate; Restructuring & Creditors’ Rights and
Tax. For more information about the Firm and its services, visit
www.munsch.com.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20150707005497/en/
Munsch Hardt Kopf & Harr, P.C.Meredith Falke,
214-880-7633mfalke@munsch.comorKerri Fulks,
972-499-6617kerri.fulks@hck2.com