Tuesday, June 15, 2021

Bad Clients Make Shaky Law on National Origin Discrimination

I just saw an interesting new decision out of New York, Bibliotechnical Athenaeum v. American University of Beirut, concluding that "national origin" anti-discrimination protections do not encompass discrimination against a company for its place of incorporation. The short version of the facts: BA is incorporated in Israel with it's principle place of business in New York, it sought to participate in AUB's online job fair, when it told AUB it was an Israeli company, AUB locked it out of the fair, BA sues alleging national origin discrimination.

It is well-established that a corporation can be subjected to "discrimination" under federal law (on account of race, ethnicity, national origin, or other protected characteristics). But that right is derivative of the identities of members of the corporation -- its shareholders, officers, employees, etc. -- and so merely noting that a company has incorporated in Israel does not demonstrate that any of its human beings are of Israeli national origin. For example, sometimes a company incorporates in a given state purely for tax purposes, but none of its officers or employees have any particular connection to the company. BA, for its part, did not plead any facts demonstrating a connection to Israel beyond the fact that it was incorporated there, and so the court concluded that if that was its only link to Israel, discrimination based on that fact is not actually "national origin" discrimination.

Precedents like this make me nervous. I get the example of how weird it would be for a company which incorporates in some random country for tax purposes being imputed as having the "national origin" of that country for discrimination law claims. At the same time, any time one opens a hole like this -- "national origin discrimination is forbidden, but this thing that's one step adjacent to national origin discrimination and could be used to effectively do the same thing as national origin discrimination is a-ok" -- one does serious damage to the vitality of anti-discrimination law. Exempting from "national origin discrimination" "discrimination on basis of place of incorporation or place of business" is an exception that could easily swallow the rule.

What's going on here? The name "Bibliotechnical Athenaeum" rang a bell -- I had heard of litigation they launched a few years ago against the National Lawyers Guild when the latter refused to accept an ad from them listing their (West Bank) address as in "Israel". But I didn't know anything else about who they were, so this time around I did some research.

Or tried to, anyway. It's virtually impossible to find anything about Bibliotechnical Athenaeum aside from coverage of lawsuits like this (which it appears to launch in collaboration with the Lawfare Project). Indeed, my strong suspicion is that they only exist to launch lawsuits like this: go up to a target they suspect does BDS-like activity, say "we're Israeli and we want to participate", then sue the organization when it locks them out. But aside from that, they don't do any substantive work (the above link on the NLG litigation says that "Bibliotechnical is not an operational, commercial business enterprise."). They are a vehicle for launching lawsuits, nothing more.

Judges tend not to look favorably on this sort of concocted litigation. The most noble example one could find is the "testers" sometimes employed by the Fair Housing Authority, to see if apartments are treating Black and White applicants alike. These are usually state employees, though, engaging in a specific enforcement mission. For better or for worse, more recent efforts by people to fly solo in this endeavor are less warmly received. I recall a series of cases from the Eighth Circuit in the past few years where a guy in a wheelchair would drive hours away from his house to random restaurants looking for technical violations of the ADA, take some pictures, and then sue the business. He didn't have any actual interest in dining at the establishments -- he was just looking for the settlement. The Eighth Circuit started rejecting these "drive-by" cases on standing grounds, saying the plaintiff was not actually injured.

I suspect that the judge in this case perceived this litigation as of a similar sort -- an ideological "drive-by" from an entity that did not actually have any real interest in working with AUB or hiring at its job fair. The fact that BA couldn't plead a tangible connection to Israel other than incorporating there (and, one surmises, it incorporated there solely so it could claim to be "Israeli" when launching litigation like this) further underscored the sense that it was engaging in abusive gamesmanship. And so the court took the path of least resistance in getting rid of the claim, which was to leverage the relatively meager connections between BA and Israel (at least as the case was pled) in order to say that it does not qualify as national origin discrimination under the statute.

However -- cases launched by bad clients still establish governing law. When Bibliotechnical (and Lawfare) launch a case like this and lose, they establish precedents that make life harder for entities with actual, non-concocted legal claims. One can easily imagine an actual company that does actual business and is actually harmed by being excluded from a job fair or whatnot suing for national origin discrimination, and the defense pointing to this case and saying "no no -- we're not excluding you because of national origin, we're excluding you because of the nation you're incorporated in, and that's totally fine!"

Ideally, the cases could be distinguished -- there is language in this opinion which suggests things would be different if BA plead connections to Israel that went beyond place-of-incorporation. But there's also language that is more sweeping in suggesting that, so long as the discriminator is targeting the company for its place of incorporation, no national origin discrimination can be found, period. The former, I think, is the better read; but the latter is absolutely available. And so a bad client makes, at best, very shaky law. Way to ruin it, guys.

No comments: