Wait A Second! blog deciphers the recent case of Brown v. Daikin American, where a reduction-in-force at a Japanese company reached only American citizens, but not the Japanese citizens. The Court isn't saying the case is proven, but only that it can't be dismissed outright without giving the plaintiff a chance at discovery. While the employer reasoned that the Japanese citizens, who were "rotational" employees brought in from Japan for a period of time, were not similarly situated to the American employees, the Court said that they were similarly situated, as they worked for the same employer. The plaintiffs now have to find documentation and testimony to support their position during the discovery period. Otherwise, they will lose on a motion for summary judgment.
The case is also notable because it permits joint liability on the subsidiary and the parent corporation, if the plaintiffs' allegations about the two companies turn out to be true:
"Here, Brown alleged that DIL "closely directed the operations of its wholly owned subsidiary, Daikin America" and that DIL’s approval‚ was required as to all significant actions by Daikin America." Brown charged that DIL"immuniz[ed]" Japanese rotational employees from discharge by directing Daikin America to discharge only employees who were not Japanese, and by prohibiting Daikin America from reassigning or discharging Japanese rotational employees. Taken together, these allegations sufficiently suggest that DIL exercised centralized control over Daikin America’s decisions about which employees to terminate in the course of the workforce reduction, and that DIL, by protecting Japanese employees from discharge, effectively ensured that employees of other races or national origins, like Brown, would be terminated." (citations omitted)
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