The Next Phase of ADA Suits? Appeals Court

As one Washington, D.C.-based credit union prepared to head to appeals court over allegations that its website violated the Americans with Disabilities Act, Wednesday more than 100 members of Congress signed a letter asking the U.S. Attorney General to help clarify language in the 1990 law that has fueled dozens of lawsuits against credit unions around the country.

The letter asked the Department of Justice to clarify whether websites are subject to the Americans with Disabilities Act and, if so, what exactly websites need to have to be considered compliant with the law.

“Businesses of every shape and size throughout the country are being threatened with legal action by private plaintiffs for unsubstantiated violations of the ADA…The absence of statutory, regulatory, or other controlling language on this issue only fuels the proliferation of these suits since there are no requirements these complaints have to meet. In fact, in most cases, these suits are filed for the purpose of reaching a financial settlement and do little or nothing to improve website accessibility,” the letter said.

In recent months, U.S. District Court judges have thrown out six cases brought against credit unions over their websites’ alleged lack of ADA compliance. But as one of those credit unions has learned, the bang of the gavel doesn’t always mean the end of the case. Instead, amid growing calls for clearer rules about whether and how the ADA applies to websites, it’s gearing up for a second round in court.

The credit union, Washington, D.C.-based Department of Labor Federal Credit Union, which has $90 million in assets and about 6,900 members, was originally sued in December 2017 in the U.S. District Court for the Eastern District of Virginia. On February 21, 2018, a judge threw out the case, finding that, among other things, the plaintiff wasn’t eligible to join the credit union. Less than a month later, however, the plaintiff appealed the decision.

“We are so pleased that organizations such as NAFCU and CUNA continue to support our fight against these cases,” said attorney John Bredehoft, who represents the credit union. “The trial court judge made the right call, and the law is fairly clear on these constitutional issues. We are confident that the court of appeals will reject this attempt to prolong the process and expense of fighting these cases.”

By some accounts, the trip through the court system has been relatively fast. But the prospect of dealing with the appeals process could leave some credit unions wondering if challenging an ADA suit is a no-end-in-sight proposition.

Carrie Hunt, who is EVP of Government Affairs and General Counsel at NAFCU, which on Wednesday filed a “friend of the court” brief in the Department of Labor FCU appeal, thinks a win in appeals court might actually put a nail in the legal coffin.

“There are different levels of deference given to case law, and at the trial court level there tends to be very little deference given to other judges’ opinions,” she explained. Of course, trial court judges often do look at each other’s opinions, she noted, but the decisions that come out of appeals courts can set a firm precedent for lower courts to follow.

Ultimately, getting some legal certainty about how the Americans with Disabilities Act applies to websites is the only way to reduce litigation risk, she added.

“There are two ways to get that. One, you can have such a strong body of case law that it doesn’t necessarily make sense from a monetary standpoint for plaintiffs’ attorneys to sue, because they know there’s no incentive for someone to settle,” she explained. “The other area, of course, is to have actual legal certainty, either from the regulatory arena or from Congress.”

A win in appeals court for Department of Labor FCU would set a precedent only in that appeals court circuit, she cautioned.

“But ultimately, you end up with a framework the more cases you have across the country to have one firm legal precedent. It is not a very quick process, and it certainly is not my first choice in setting policy, but this is why we have three branches of government. When something is not addressed by one, then the other steps in,” she said.