UNITED STATES DISTRICT COURT DISTRICT OF MINNESOTA ...

CASE 0:14-cv-04517-ADM-TNL Document 20 Filed 10/30/14 Page 1 of 44

UNITED STATES DISTRICT COURT DISTRICT OF MINNESOTA __________________________________________________________________ Equal Employment Opportunity ) Commission, ) ) Plaintiff, ) ) Civil Action No. 14-CV-04517 v. ) ) Honeywell International Inc., ) ) Defendant. ) MEMORANDUM OF LAW IN OPPOSITION TO PLAINTIFF’S MOTION FOR TEMPORARY RESTRAINING ORDER AND EXPEDITED PRELIMINARY INJUNCTION Honeywell International Inc. (“Honeywell”) hereby submits this Memorandum of Law in Opposition to Plaintiff’s Motion for Temporary Restraining Order and Expedited Preliminary Injunction (“Plaintiff’s Motion”). I.

INTRODUCTION Preliminary injunctive relief is a “drastic and extraordinary remedy” that should

only be granted in rare cases. This is not one of those cases. The EEOC must prove four elements: 1) irreparable harm; 2) likelihood of success on the merits; 3) that the balance of harm favors an injunction; and 4) that the public interest favors an injunction. As demonstrated below, the EEOC cannot satisfy any of these elements. The claims at issue here involve challenges to a wellness program that Honeywell offers to its employees as part of its group health plan. Honeywell offers its employees the option to participate in a self-insured group health plan – The Honeywell High


Deductible Health Plan (“HDHP”). Employees (and their spouses) who are enrolled and participate in the HDHP can choose to participate in a wellness program. As a sponsor of a self-insured group health plan, Honeywell engages an independent third party actuarial firm to perform an underwriting analysis each year. This analysis examines past claims experience, current and future plan design parameters, and the impact of Honeywell’s wellness plan for purposes of estimating future plan costs. This iterative process results in the future design and pricing of the Honeywell plan (including the operation of the wellness program) in order to establish the anticipated cost of the plan for the following year. The Honeywell wellness program includes free biometric screening, which captures basic health information, including blood pressure, HDL cholesterol level, total cholesterol level, glucose level, height, weight, waist circumference, and nicotine level.1 An independent health management company (i) receives each participant’s individualized results, (ii) informs participants of their individual health status and risks, and (iii) provides information on improving those health risks, which should result in improved health and decreased healthcare costs. Honeywell does not have access to, and is not provided with, any individual results from the biometric screenings. The underlying charges for which the EEOC seeks immediate injunctive relief challenge the surcharges for employees who choose not to participate in Honeywell’s wellness program. The EEOC, on behalf of three complainants (out of Honeywell’s tens 1

It does not entail a broad health questionnaire or any questions related to an employee’s family medical history. 2


of thousands of employees), in essence contends that Honeywell’s wellness program violates the Americans with Disabilities Act (“ADA”) because it has been structured as a monthly surcharge assessed on non-participants rather than a monthly incentive given to participants. The EEOC further contends that Honeywell’s program relating to biometric screening for spouses violates the Genetic Information Nondiscrimination Act (“GINA”). As shown below, the EEOC’s positions are without merit and there is certainly no basis for emergency injunctive relief. First, the EEOC has failed to make any showing of the existence of irreparable harm in the absence of an immediate injunction. Astonishingly, all of the charging parties on whose behalf the EEOC seeks an injunction have already taken the very biometric screening for 2015 about which the EEOC is objecting. Moreover, each of the charging parties similarly chose to take the screening last year, even though there was no associated surcharge in 2014 for failing to participate. Thus, there is absolutely no need for emergency injunctive relief on behalf of the charging parties. Moreover, contrary to the EEOC’s characterization that Honeywell “requires” its employees to do biometric screening, there is no such requirement. Employees are not required to do the biometric screening to obtain health coverage, nor can any employee be disciplined or terminated for not participating. In reality, the only thing the EEOC is challenging are surcharges that will be imposed, starting in January of 2015, on employees who choose not to participate in the wellness program under the HDHP (i.e., non-participants in the wellness program will pay more for their health coverage). Thus, for any individual who decides he/she does not want to do biometric screening (which does not include the 3


charging parties), the only potential harm is the monetary surcharge, which is a monthly pre-tax wage deduction that does not even commence until January 2015. Even if the EEOC ultimately prevails, which it will not, a monetary award can fully refund any surcharges that are paid. With a clear and adequate remedy at law, there is no argument in support of irreparable harm in this case. Second, the EEOC does not have a substantial likelihood of prevailing on the merits. A wellness program (including with surcharges) that is part of a group health plan, just like Honeywell’s program, is lawful under the ADA insurance safe harbor provision. The EEOC’s argument that Honeywell does not engage in underwriting or risk classification activity and is not covered by the safe harbor provision is factually wrong and ignores clear persuasive authority. In addition, under an alternative provision of the ADA, Honeywell’s wellness program is permissible because it is in fact voluntary. More than 30,000 employees/spouses (53% of those eligible) have already chosen to participate in the wellness program as constructed. Encouraging employees to participate through economic incentives (surcharges or otherwise) does not make the wellness program involuntary.

Any employee can choose not to participate in the wellness

program and all they have to do is pay more for their health care coverage. Contrary to the EEOC’s contention that the financial surcharges are “too high,” in fact, they are well within the limits established and endorsed as acceptable by the Affordable Care Act (“ACA”) and the Health Insurance Portability and Accountability Act (“HIPAA”). Finally, the EEOC’s argument that Honeywell’s wellness program violates GINA is frivolous. It is clear under GINA that a biometric screening, like the one here, does not 4


constitute a genetic test and does not reveal any genetic information about an employee and therefore, is not in violation of the statute. Third, the balance of harm caused by injunctive relief weighs heavily against granting such an extraordinary remedy. Honeywell and its employees face substantial harm. Honeywell would be required to rewrite its 2015 benefit plan that was developed over a long period of time on an emergency basis. If employees are now told that there will be no surcharges and they therefore choose not do the biometric screening, such employees will not have the ability to make a different health plan choice during 2015 and will incur the surcharges if Honeywell later prevails. In other words, employees will be deprived of the ability to make an accurate, fully-informed economic choice. In addition, if Honeywell is required to fund HSA accounts for employees who refuse to participate in the wellness program, as the EEOC demands, Honeywell will almost certainly not be able to recoup the HSA funds if Honeywell later prevails. In contrast, if employees choose not to do the screening now and the EEOC later prevails, they simply can be reimbursed by Honeywell for any surcharges that they incur and be provided any HSA contributions they did not receive during the months before a decision on the merits. Finally, if the expected biometric surcharges cannot be collected as planned, the cost for coverage for all employees would rise to make up the difference, thereby causing direct harm to the tens of thousands of Honeywell employees who choose to live a healthier lifestyle. Lastly, the EEOC’s argument that the public interest favors an injunction to further the purposes of the ADA and GINA is equally without merit. Contrary to the 5


concerns underlying the ADA, here, Honeywell does not have access to any individual results of the biometric screenings. There is absolutely no basis to assert that emergency injunctive relief is needed to protect employees from any of the harms designed to be protected by the ADA or GINA. In contrast, other federal statutes like HIPAA and the ACA both encourage and endorse steps to incentivize employees to engage in wellness programs and in healthy behaviors, and Honeywell’s incentives are well within the ranges identified in those statutes as encouraged and permissible. Finally, and most perversely, the EEOC’s requested relief would likely only cause employees not to engage in biometric screening, and it is simply not in the public interest to discourage employees from learning about their health status and about ways to improve their health. For all of these reasons, Plaintiff’s Motion for Temporary Restraining Order and Expedited Preliminary Injunction should be denied. II.

FACTUAL BACKGROUND A.

The Honeywell High Deductible Health Plan (“HDHP”) And Wellness Program.

Honeywell offers its employees and their families health insurance coverage through a self-insured group health plan called the HDHP. Gregg Decl. ¶ 3. As part of that plan, Honeywell offers a wellness program, which is designed to assist Honeywell’s employees and their spouses2 with understanding and improving their health and wellness. Id. ¶ 8. Only employees and their spouses who participate in the HDHP are eligible to participate in the HDHP’s wellness program. Id. The overarching purpose of

2

As used herein, the term “spouse” refers to spouses and domestic partners. 6


the wellness program is to inform HDHP participants about their health status, to provide them with important information that they can use in managing and improving their health, and ultimately to reduce claims costs under the HDHP. Id. ¶ 17. In connection with the HDHP open enrollment process for obtaining health insurance coverage under the HDHP, employees and their spouses are given the option to participate in the wellness program. Id. ¶ 9. Participation is purely voluntary. Id. Employees and their spouses are eligible for health insurance coverage regardless of whether they choose to participate in the wellness program. Id. Employees are not subject to any discipline or termination if they choose not to participate. Id. B.

Biometric Screening Under The HDHP.

Employees and spouses who choose to participate in the HDHP wellness program agree to participate in a biometric screening. Id. ¶ 10. Each employee and spouse independently decides whether or not to participate in the biometric screening. Id. For those who choose to participate in the biometric screening, each employee and spouse is provided with a separate log-in and password to enable them to view only their own results (i.e., not their spouse’s results).

Id.

The biometric screening collects basic

information about the employee’s or spouse’s blood pressure, HDL cholesterol level, total cholesterol level, glucose level, height, weight, waist circumference, and nicotine level.

Id. ¶ 11.

The Honeywell wellness program does not include a health

questionnaire, and it does not request any personal or family medical history from employees or spouses. Id. ¶ 12.

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The biometric screening can be completed at Quest Diagnostics (“Quest”) at no charge to the employee or spouse. Id. ¶ 13. Quest has approximately 2,000 locations across the country and for the convenience of its employees, Honeywell arranged to have Quest available for on-site screening at many of its locations. Id. Honeywell pays the cost of the biometric screening. Id. ¶ 11. Alternatively, employees and spouses who wish to participate in the wellness program can choose to submit a form from their personal physician in the event that they already have attended an annual preventative health visit in 2014 that included biometric screening. Id. ¶ 14. In addition, employees and spouses who are unable to obtain a biometric screening, for example due to pregnancy or other medical condition, may request a waiver from participating in biometric screening. Id. ¶ 15. Quest transmits the biometric screening results to an independent health management company that administers Honeywell’s wellness program. Id. ¶ 16. These results are kept in the strictest confidence by the independent health management company, and Honeywell does not receive any of the individual results of its employees’ and their spouses’ screenings (e.g., HDL levels, blood pressure numbers, etc.). Id. Each employee and spouse independently receives, in writing, their own biometric screening results describing the health risks (if any) identified by the screening and, if applicable, providing general information regarding reducing those health risks, which they can then discuss with their personal physician. Id. ¶ 18.

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C.

Incentives For Participation In The HDHP Wellness Program.

As noted above, participation in the HDHP wellness program is purely voluntary. Honeywell employees are not subject to any discipline or loss of coverage for choosing not to participate in biometric screening. Id. ¶ 21. Honeywell offers its employees who participate in the HDHP financial incentives to encourage them to participate in the wellness program. Id. ¶ 19. Employees who choose to participate and whose annual base salary is less than $100,000 receive a company-provided Health Savings Account (“HSA”) contribution ranging from $250 to $1,500.3 Id. In addition, employees who choose to participate in the wellness program pay a smaller employee contribution for HDHP coverage than those who choose not to participate. Id. ¶ 20. A $500 biometric surcharge is added to the annual health insurance contribution of employees who choose not to participate in biometric screening. Id. On a monthly basis, the surcharge amounts to a modest pre-tax monthly deduction from their pay in an amount approximately equal to $41.67. Id. Employees are not assessed a surcharge with respect to spouses covered under the HDHP who choose not to participate in the biometric screening. Id. Biometric screening is not new at Honeywell. Id. ¶ 22. This is the third year Honeywell has offered employees the option of participating in biometric screening in connection with the HDHP. Id. All three complainants chose to participate in biometric screening in 2013 in connection with the 2014 HDHP, which was the first year their 3

A HSA is a tax-exempt account used to pay or reimburse certain medical expenses of employees and family members. See Internal Revenue Service, Publ’n 969, available at http://www.irs.gov/publications/p969/ar02.html. 9


business unit participated in the HDHP. Id. However, many other Honeywell employees choose not to participate in biometric screening.

Id. ¶ 23.

In 2013, for example,

approximately 23% chose not to participate in biometric screening. Id.4 Employees and spouses have had the opportunity to complete biometric screening for the 2015 HDHP’s wellness program since August 12, 2014. Id. ¶ 35; Exhibit 1. More than 30,000 employees and spouses already have chosen to participate in the 2015 HDHP wellness program’s biometric screening. Id. ¶ 38. This is equal to approximately 53% of the total number of employees and spouses who are anticipated to enroll in the 2015 HDHP. Id. Employees who choose not to participate in the 2015 HDHP wellness program will not be assessed any surcharge prior to January 1, 2015, the effective date of the 2015 HDHP. Id. ¶ 36. All three of the complainants on whose behalf the EEOC seeks an injunction already chose to participate in the wellness program and completed the biometric screening in 2014 for the 2015 HDHP plan year. Id. ¶ 33. D.

The Tobacco Surcharge.

The HDHP rewards non-tobacco users by charging them less for coverage than tobacco users. Id. ¶ 24. Like all U.S. employers, Honeywell faces the challenge of improving health related outcomes and quality of life for employees, while managing health care costs. Id. ¶ 7. It is well-established that tobacco use leads to diseases and causes health care costs to rise. Id. ¶ 25. According to the New England Journal of 4

Biometric screening under the 2014 HDHP was identical to the biometric screening under the 2015 HDHP, except there was no nicotine screening in the 2014 HDHP biometric screening. Under the 2014 HDHP, there was no $500 biometric surcharge for employees who chose not to participate in biometric screening, but HSA contributions were offered to employees who participated. Gregg Dec. ¶ 22. 10


Medicine, health care costs for smokers of tobacco at a given age are as much as 40 percent higher than those for non-smokers of tobacco. Id. To help offset those higher costs for Honeywell and employees, Honeywell will charge each employee who participates in the 2015 HDHP $1,000 more in HDHP premiums for each employee and each spouse who is a tobacco user, as compared to those who are not a tobacco user. Id. ¶ 26. The tobacco surcharge also is not new. The HDHP charged tobacco users a surcharge in the 2013 and 2014 plan years as well. Id. ¶ 27. Tobacco status previously was determined based on self-certification of employees and their spouses regarding whether they used tobacco. Id. Under the 2015 HDHP, employees and spouses who choose to participate in biometric screening and who screen positive for nicotine are presumed to be tobacco users. Id. ¶ 28-29. Employees and spouses who choose not to participate in biometric screening also are presumed to be tobacco users. Id. All of the presumed tobacco users can avoid the tobacco surcharge in three ways. First, they can agree to enroll in a tobacco cessation program, at no cost to the tobacco users. See Gregg Decl. ¶ 30 & Exhibit B at FAQ 24-25. The individual need only enroll and participate in the tobacco cessation program. Id. ¶ 31. Actual cessation of tobacco use is not required to avoid the tobacco surcharge. Id. Second, they can provide a complete biometric screening report from their personal physician showing that they in fact do not use tobacco. Id. at ¶ 30 & Exhibit B at FAQ 27. Third, they can “work with a Health Advocate to establish [they] are not a tobacco user . . . subject to Honeywell’s Code of Conduct and Ethics Policy.” Id. at ¶ 30 & Exhibit B at FAQs 22-23. In other 11


words, just like last year, presumed tobacco users can avoid the tobacco surcharge by simply certifying to the Health Advocate that they do not use tobacco, which is what many employees have done this year already. Id. at ¶ 30. All three of the complainants (and any covered spouses) certified last year that they are not tobacco users, so none of them should face a tobacco surcharge. Id. at ¶ 27. E.

The Planning And Development Of The 2015 HDHP.

Honeywell has been planning and developing the 2015 HDHP for more than 10 months, since January 2014. Id. ¶ 46. As an employer that sponsors a self-insured health plan, Honeywell engages an independent third party actuarial firm (staffed with individuals who are members of the Society of Actuaries) to perform an underwriting analysis each year. Id. ¶ 44. This analysis examines past claims experience, current and future plan design parameters, and the impact of Honeywell’s wellness program in order to estimate future plan costs. Id. This iterative process results in the future design and pricing of the Honeywell health plan (including the operation of the wellness program) in order to establish the anticipated cost of the plan for the following year. Id. ¶ 45. This is exactly the same process that the underwriters at an insurance company use to determine the design and premiums for insurance coverage and related wellness programs. Id. Honeywell and the actuarial firm completed this process for the 2015 HDHP in April 2014, and they have been designing and rolling out the 2015 HDHP since that time. Id. ¶ 46. The biometric screening has been available for employees to complete since August 12, 2014. Id. ¶ 35.

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F.

The Complainants.

Keenan Hall, Sueann Schwartz and Thomas Aguirre are current Honeywell employees who recently filed Charges with the EEOC claiming that the wellness program component of Honeywell’s 2015 HDHP violates the ADA and GINA. In connection with participating in the HDHP and wellness program, Mr. Hall, Ms. Schwartz and Mr. Aguirre have already participated in biometric screening this year for the 2015 HDHP and they all did the biometric screening last year as well. Id. ¶¶ 22, 33. Neither Mr. Hall nor Ms. Schwartz has a covered spouse under the HDHP. Id. ¶ 32. Mr. Hall dropped his spouse from coverage on October 7, 2014. Id. Although Mr. Hall and the EEOC now assert that he did so because his spouse refused to participate in biometric screening, he previously represented to Honeywell that he was dropping his spouse from coverage because her work hours had increased and she had become eligible for health insurance coverage through her employer. Id. Mr. Aguirre has a covered spouse who already has completed biometric screening for the 2015 HDHP. Id. Thus, none of the charging parties are subject to any surcharge for lack of participation and all of them will receive HSA contributions for participating in the biometric screening.

Id.

¶ 33. III.

ARGUMENT A.

The EEOC Must Satisfy All Requirements For Obtaining A Temporary Restraining Order.

A temporary restraining order is “a drastic and extraordinary remedy that is not to be routinely granted.” Travel Tags, Inc. v. UV Color, Inc., 690 F. Supp. 2d 785, 797 (D.

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Minn. 2010); accord Life Time Fitness, Inc. v. DeCelles, 854 F. Supp. 2d 690, 694 (D. Minn. 2012) (same). A temporary restraining order is appropriate only if the moving party can demonstrate: (1) a likelihood of success on the merits (2) irreparable harm in the absence of injunctive relief; (3) that the balance of harm favors the movant; and (4) that the public interest favors the movant. Dataphase Sys., Inc. v. C L Sys., Inc., 640 F.2d 109, 114 (8th Cir. 1981). The Court must balance these factors to determine whether the temporary restraining order is warranted. Id. at 113. Plaintiffs bear the burden of proving all four factors. See Watkins Inc. v. Lewis, 346 F.3d 841, 844 (8th Cir. 2003). In all cases, a showing of irreparable harm is required in order to obtain a temporary restraining order. General Motors Corp. v. Harry Brown’s LLC, 563 F.3d 312, 318 (8th Cir. 2009) (“Regardless of the strength of its claim on the merits, a movant . . . should show a threat of irreparable harm”); United Indus. Corp. v. Clorox Co., 140 F.3d 1175, 1183 (8th Cir. 1998) (holding that a failure to demonstrate the threat of irreparable harm is sufficient to deny injunctive relief). It is well-established that the EEOC must prove all of these same elements in order to obtain injunctive relief on behalf of employees. See EEOC v. Target Stores, Inc., No. 4-84-963, 1984 WL 1071, at *1-2 (D. Minn. Sept. 21, 1984) (citing EEOC v. Anchor Hocking Corp., 666 F.2d 1073 (6th Cir. 1981)); EEOC v. Work Connection, No. 3-86662, 1986 WL 11265 (D. Minn. July 29, 1986) (requiring the EEOC to show irreparable harm in order to obtain temporary restraining order on behalf of employee); see also EEOC v. Astra U.S.A., Inc., 94 F.3d 738, 743, 747 (1st Cir. 1996) (holding that the EEOC

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is required to satisfy the traditional requirements for injunctive relief, including irreparable harm).5 B.

There Is No Risk Of Irreparable Harm As There Is A Clear And Adequate Remedy Available If The EEOC Prevails.

“Irreparable harm occurs when a party has no adequate remedy at law, typically because its injuries cannot be fully compensated through an award of damages.” General Motors, 563 F.3d at 319. The law is clear that irreparable harm does not exist if an employee can be adequately compensated with backpay or monetary damages. See Harris v. U.S., 745 F.2d 535, 536 (8th Cir. 1984) (affirming denial of injunctive relief because plaintiff could be adequately compensated with “an award of full backpay” at the conclusion of the proceedings, and “the absence of a showing of irreparable harm is, in itself, sufficient grounds upon which to deny a preliminary injunction.”); see also Hale v. Wood, 89 F.3d 840, 1996 WL 341206, at *1 (8th Cir. 1996) (unpublished opinion) (affirming denial of injunctive relief on the ground that plaintiff “failed to establish a threat of irreparable harm because the injuries he alleged as the basis for his claim for relief—wrongfully withheld wages, statutorily inadequate wages, and termination of his work assignment—were compensable through his section 1983 claim for money damages.”); Roberts v. Van Buren Pub. Schs., 731 F.2d 523, 526 (8th Cir. 1984) (affirming denial of injunctive relief because backpay would “offer a complete remedy”). Courts routinely deny injunctive relief to the EEOC where, like here, the EEOC fails to establish irreparable harm “to [itself] or the charging party.” Target Stores, 1984 5

See also cases cited infra at 15-17. 15


WL 1071, at *2; Anchor Hocking, 666 F.2d at 1043 (affirming denial of preliminary injunction because the EEOC did not establish irreparable harm to employee or EEOC and rejecting “the notion that a statutory violation is irreparable injury per se.”); EEOC v. City of Janesville, 630 F.2d 1254, 1259 (7th Cir. 1980) (reversing trial court’s issuance of preliminary injunction sought by the EEOC because “irreparable injury does not include loss of income . . . or financial distress[,]” and thus the EEOC failed to sufficiently show irreparable harm in the absence of injunctive relief); EEOC v. Exxon Mobil Corp., No. 06-1732, 2007 WL 1556964, at *9 (N.D. Tex. May 30, 2007) (denying the EEOC’s application for preliminary injunction because the “EEOC has not carried its burden of proving irreparable harm particularly in light of the fact a preliminary injunction is such an extraordinary remedy and that any difference in salary and benefits could be compensated with money.”); EEOC v. Chateau Normandy, Inc., 658 F. Supp. 598 (S.D. Ind. 1987) (where the EEOC sought preliminary injunction enjoining employer from requiring employee to take mandatory pregnancy leave, court denied injunctive relief because the EEOC could not show that employee or the EEOC would suffer any irreparable harm absent injunctive relief); EEOC v. Howard Univ., No. 83-879, 1983 WL 519 (D.D.C. June 14, 1983) (denying preliminary injunction in part because the EEOC failed to establish irreparable harm to the employee or EEOC); EEOC v. Bay Shipbuilding Corp., 480 F. Supp. 925 (E.D. Wis. 1979) (denying the EEOC’s motion for preliminary injunction because EEOC failed to show any irreparable harm). Even in more severe cases where the EEOC has alleged that an employer unlawfully terminated an employee, courts have held that irreparable harm does not exist 16


because damages can fully compensate the employee for his or her harm at the conclusion of the litigation. EEOC v. Anchor Hocking Corp., No. C-280-138, 1980 WL 18649, at *2 (S.D. Ohio Apr. 7, 1980), aff’d, 666 F.2d 1037 (6th Cir. 1981) (citing Sampson v. Murray, 415 U.S. 61, 90 (1974) (holding that “temporary loss of income, ultimately to be recovered, does not usually constitute irreparable injury.”)). In Anchor Hocking, the EEOC alleged that the employer discharged an employee in retaliation for his participation in EEOC charges filed by his coworkers. 666. F.2d at 1038-39. The EEOC sought a preliminary injunction requiring the employer to reinstate the employee during the pendency of the trial. Id. The Sixth Circuit affirmed the district court’s order denying the EEOC any preliminary injunctive relief, holding that “the statutory remedies of reinstatement and back pay will adequately redress his injury if his retaliation claim is successful.” Id. at 1044; see also Bay Shipbuilding, 480 F. Supp. at 928 (the EEOC failed to establish irreparable harm to employee because mere “sudden loss of employment” is insufficient under Supreme Court precedent); EEOC v. Dravo Corp., No. 84-1446, 1984 WL 1144, at *1 (W.D. Pa. July 12, 1984) (denying the EEOC preliminary injunctive relief because “the Court does not find that the loss of wages through suspension or discharge constitutes such irreparable harm as justifies the granting of a preliminary injunction” and thus “we find that as a private plaintiff the two complainants here do not suffer irreparable harm pending the outcome of the matter.”). This case too is about nothing more than money. All three of the charging parties have already taken the biometric screening and chosen to participate in the wellness program, just as each of them did the year before. Gregg Decl. ¶¶ 22, 33. Moreover, 17


Honeywell employees who object to biometric screening can choose not to participate. The only consequence will be a $500 annual surcharge on their 2015 HDHP employee contribution, which they will pay in $41.67 monthly installments in 2015. Employees could also be subject to the tobacco user surcharge (just like last year) as a presumed tobacco user at approximately $83.34 per month, but they can take steps outside the biometric screening process to avoid that surcharge. There is no risk that any employee will lose his or her job or his or her health coverage. If the EEOC ultimately prevails in challenging the biometric screening in this action (which it should not), a damages award of $500 or $1,500 will fully compensate employees. Accordingly, this is a pure damages case, and the EEOC cannot establish irreparable harm warranting a temporary restraining order. The EEOC’s argument that employees feel pressure to participate in biometric screening and will ultimately participate in biometric screening against their wishes because of the biometric surcharge is purely speculative and is not an adequate basis for injunctive relief. The EEOC utterly fails to explain how the free, limited biometric screening offered to Honeywell employees could cause any harm, let alone irreparable harm, to an employee or spouse who chooses to do it. The purpose of the biometric screening is to educate employees and their spouses, improve their health, and reduce their healthcare costs, all of which benefit employees and their spouses rather than causing them any harm. Indeed, the EEOC approves of biometric screening so long as it is voluntary (under their unsupported definition), which further confirms that participating in biometric screening is not in any way inherently harmful. Again, all three 18


of the charging parties have already completed their biometric screening for this year and all three did it last year even when there was no extra surcharge for failing to participate. Gregg Decl. ¶¶ 22, 33. There is simply no basis to assert that the charging parties would suffer irreparable harm in the absence of an injunction. Additionally, the law is clear that “[i]njunctive relief is not appropriate when the harm is merely speculative or based on a mere assumption of possible results.” Aune v. Ludeman, No. 09-15, 2009 WL 1586739, at *4 (D. Minn. June 3, 2009). The EEOC offers mere speculation and no proof that employees are forced (have no reasonable alternative) to complete the biometric screening because of the surcharges. The factual record reveals that the alleged economic pressure is pure fiction. Employees and spouses have had the opportunity to complete biometric screening for the 2015 HDHP’s wellness program since August 12, 2014, and only half of the total number of employees and spouses who are anticipated to enroll in the 2015 HDHP have chosen to complete the screening to date.

Gregg Decl. ¶¶ 35, 38.

This fact plainly refutes the EEOC’s

speculative assertion that the biometric surcharge is causing immediate pressure warranting a temporary restraining order. Moreover, 77% of all employees/spouses last year signed up for biometric screening when there were no surcharges, which belies any notion that individuals do not want to do biometric screening. Id. ¶ 23. The EEOC’s assertion that, based on the surcharges, employees have no possible choice but to sign up for the biometric screening (i.e., the Honeywell coverage is not affordable if they incurred the surcharges) is completely contrary to the standards set forth in the ACA as to what constitutes “affordable care.” The EEOC does not articulate 19


any standard for what amount of a surcharge would purportedly make biometric screening involuntary. Under the EEOC’s argument, even a $50 annual surcharge would transform a voluntary biometric screening into involuntary biometric screening. This position lacks any reasoned basis. The Court should instead follow the ACA, in which Congress has supplied a reasoned and appropriate standard for determining whether a surcharge is affordable (and thus voluntary) or unaffordable (and thus involuntary). The ACA defines “affordable care” as any cost up to 9.5% of an employee’s adjusted gross income.6 With or without all applicable surcharges, the cost of healthcare coverage for Honeywell employees falls below the 9.5% threshold. Gregg Decl. ¶ 21. None of the three charging parties would have had to pay even close to the 9.5% threshold had they chosen not to participate in the wellness program. Id. Thus, as a matter of law, the charging parties (and for that matter, all Honeywell employees) were/are offered affordable healthcare even if all applicable surcharges for not participating in the wellness program are included. Id. Thus, the HDHP meets Congress’ definition of “affordable” and there is no viable argument that due to the coverage cost (with applicable surcharges) employees have no reasonable alternative but to do the biometric screening. To the extent the EEOC argues that it will suffer irreparable harm absent injunctive relief, there is no basis in the law for the EEOC’s assertion. In order to obtain injunctive relief based on harm to the EEOC, the EEOC must show that without 6

See Internal Revenue Code § 36B(c)(2)(C)(i); Internal Revenue Code Regulations § 54.4980H-5(e). 20


injunctive relief, its ability to investigate the charging parties’ charges will be impeded. Anchor Hocking, 1980 WL 18649, at *2 (denying injunctive relief because “[w]ith regard to the EEOC, there must be a showing that [the defendant] has impeded its investigative functions. This showing has not been made.”). The EEOC cannot make this showing where “the Commission has only barely begun its investigation and, ‘consequently, is in no position to gauge to what extent, if any, its investigation will be impaired.’” Id. (quoting Bay Shipbuilding, 480 F. Supp. at 928).

As the Anchor Hocking court

explained, it generally is the EEOC’s responsibility to investigate and adjudicate charges of discrimination in the first instance, before any judicial ruling.

Absent actual,

threatened irreparable harm to a charging party, the sole basis for allowing the EEOC to obtain injunctive relief is to “assur[e] that the Commission is able to carry on its investigation unfettered by interference from the defendant.”

Id.

Where no such

interference is shown, alleged harm to the EEOC is not a valid basis to obtain injunctive relief. Id.; accord Bay Shipbuilding, 480 F. Supp. at 928; see also EEOC. v. Howard Univ., No. 83-879, 1983 WL 519, at *4 (D.D.C. June 14, 1983) (holding that the EEOC failed to show irreparable harm where, although the EEOC encountered “reluctance on the part of potential witnesses”, it had “not yet resorted to the use of the full panoply of its powers” to issue administrative subpoenas or initiate an investigation). Here, the EEOC has not even alleged or argued that its investigation has been or will be impeded by Honeywell.

Quite to the contrary, Honeywell expeditiously

responded to the first two charges provided by the EEOC and submitted a detailed position statement on the issues in this case within six days of being notified by the 21


EEOC. See Exhibit 1, Oct. 22, 2014 Ltr. from M. Burkhardt to J. Rowe (attachments omitted). The EEOC instead makes the vague and ambiguous argument that its “ability to enforce the Acts, including by preventing discrimination from occurring, will be irreparably harmed.” There is no basis in the law or facts to support such an argument. Accordingly, the EEOC has not demonstrated and cannot demonstrate any irreparable harm, and on this basis alone, Plaintiff’s Motion for Temporary Restraining Order and Expedited Preliminary Injunction should be denied. General Motors, 563 F.3d at 318 (a showing of irreparable always should be required before granting injunctive relief); United Indus. Corp., 140 F.3d at 1183 (failure to demonstrate irreparable harm is sufficient to deny injunctive relief). C.

The EEOC Is Not Likely To Prevail On The Merits.

To obtain a temporary restraining order, a movant also must establish a likelihood of success on the merits. See Barrett v. Claycomb, 705 F.3d 315, 320 (8th Cir. 2013) (vacating preliminary injunction because “the absence of a likelihood of success on the merits strongly suggests that preliminary injunctive relief should be denied.”) (quoting CDI Energy Servs., Inc. v. West River Pumps, Inc., 567 F.3d 398, 402 (8th Cir. 2009) (affirming denial of injunctive relief because the movant “failed to meet his burden” to prove “likelihood of success on the merits”)). Here, Plaintiff cannot demonstrate the necessary likelihood of success on the merits, because, as shown below, Honeywell’s wellness program fully complies with all applicable federal laws, including the ADA and GINA.

22


1.

The HDHP Wellness Program Complies With The ADA Under The Insurance Safe Harbor.

Although Subchapter I of the ADA generally prohibits employers from requiring employees to undergo medical examinations unless they are “job-related and consistent with business necessity,” 42 U.S.C. § 12112(d)(4)(A), that prohibition does not apply to medical examinations conducted in accordance with the ADA’s insurance safe harbor provision. This safe harbor provision states that the prohibitions in Subchapters I through III and Title IV of the ADA “shall not be construed to prohibit or restrict” covered entities from “establishing, sponsoring, observing or administering the terms of a bona fide benefit plan that are based on underwriting risks, classifying risks, or administering such risks that are based on or not inconsistent with state law.” 42 U.S.C. § 12201(c)(2). “The purpose of the safe harbor provision is to permit the development and administration of benefit plans in accordance with accepted principles of risk assessment.” Barnes v. Benham Grp., Inc., 22 F. Supp. 2d 1013, 1020 (D. Minn. 1998). Honeywell’s wellness program is clearly covered under the ADA’s insurance safe harbor provision. The wellness program is offered as part of a bona fide benefit plan, the HDHP, and, therefore, is permissible under the safe harbor provision. In a case directly on point, the Eleventh Circuit Court of Appeals recently upheld an employer wellness program that, like here, was offered as part of a group health plan. See Seff v. Broward County, 691 F.3d 1221, 1223 (11th Cir. 2012). In Seff, an employee challenged a similar wellness program. Employees who participated in the employer’s group health plan were invited to participate in the

23


wellness program by completing a health risk assessment and participating in biometric screening. Id. at 1222. Employees who declined to participate in the wellness program were assessed a $20 bi-weekly surcharge (i.e., $40 per month). Id. The Eleventh Circuit held that this wellness program fell within the ADA insurance safe harbor provision and affirmed summary judgment for the employer. Id. at 1223-24. Like the wellness program in Seff, Honeywell’s wellness program satisfies all of the insurance safe harbor requirements and is therefore valid. In Seff, the court held that the employer’s wellness program was a “term” of its group health plan because (i) the wellness program was sponsored as part of the contract to provide the employer with a group health plan; (ii) the program was offered to group health plan enrollees; and (iii) the employer presented the program as part of its group health plan in at least two employee handouts. Seff, 691 F.3d at 1224. The court held that these facts established that the wellness program was a “term” of the group health plan even though the group health plan’s summary plan documents did not discuss the wellness program. Id. Here, the facts even more clearly establish that the Honeywell wellness program is a term of Honeywell’s HDHP group health plan. Only employees and their spouses who participate in the HDHP are eligible to participate in the HDHP’s wellness program. See Gregg Decl. ¶ 8. The wellness program is offered to HDHP participants in connection with the HDHP’s open enrollment process. Id. ¶ 9. Moreover, the Summary Plan Description for the HDHP clearly sets forth all applicable provisions of the wellness program, including the biometric screening option. See Gregg Decl. at Exhibit A, HDHP

24


Summary Plan Description at 29-32. It is thus indisputable that Honeywell’s wellness program is a term of its HDHP group health plan. Contrary to the EEOC’s unsupported argument that Honeywell does not engage in underwriting activity, in reality, Honeywell’s wellness program is “based on underwriting risks, classifying risks, or administering such risks.” 42 U.S.C. § 12201(c)(2). Risk classification means “the process of collecting information about the health of the insured in order to assess risks so the insurer may accurately establish premiums—in other words: the process of developing insurance plans.” Seff v. Broward County, 778 F. Supp. 2d 1370, 1373 (S.D. Fla. 2011), aff’d 691 F.3d 1221 (11th Cir. 2012). In Seff, for example, a health risk assessment and biometric screening were used to identify individuals with certain health risks, and those employees received the opportunity to participate in a disease management program that helped them to manage their health risks. 691 F.3d at 1222. The Eleventh Circuit Court of Appeals affirmed the district court’s holding that the classification and management of these health risks was sufficient to satisfy this element. Id. The district court’s detailed underlying reasoning is directly applicable here: The wellness program . . . [wa]s designed to develop and administer present and future benefits plans using accepted principles of risk assessment. The program renders aggregate data to the [employer] that it may analyze when developing future benefit plans. The [employer] uses this information to classify various risks and decide what type of benefits plans will be needed in the future in light of these risks. The County is thus determining what kind of coverage will need to be provided. Though it is not underwriting or classifying risks on an individual basis, it is underwriting and classifying 25


risks on a macroscopic level so it may form economically sound benefits plans for the future. Furthermore, the wellness program is an initiative designed to mitigate risks. It is based on the theory that encouraging employees to get involved in their own healthcare leads to a more healthy population that costs less to insure. In other words, the program is based on underwriting, classifying, and administering risks because its ultimate goal is to sponsor insurance plans that maintain or lower its participant's premiums. Seff, 778 F. Supp. 2d at 1373. The EEOC does not dispute that this case is on all fours with Seff; it simply argues that the Seff court reached the wrong result. However, just like in Seff, the biometric screening results here are used to identify and assess health risks, to provide employees and their spouses with resources to manage and reduce health risks, and ultimately to reduce claims costs after the wellness program successfully reduces the health risks. See Gregg Decl. ¶¶ 17-18, 41. In addition, the aggregate biometric screening results are used by Honeywell and an independent third party actuarial firm during its annual underwriting process to estimate future plan design, pricing, and costs. Id. ¶¶ 44-45. This is exactly the same process that the underwriters at an insurance company use to determine the design and premiums for insurance coverage and related wellness programs, and it is precisely how the employer in Seff used its wellness program information in underwriting and risk classification. Id. ¶ 45. In addition, with respect to tobacco use in particular, grouping tobacco users together under an adjusted premium to account for the well-established, increased health risks and costs of tobacco use is clearly part of “underwriting risks, classifying risks or administering such risks.” Id. ¶¶ 24-26. 26


Accordingly, Honeywell’s HDHP and the wellness program that is part of that plan satisfy this safe harbor requirement as well. In addition, a case cited by the EEOC, Barnes v. Benham Grp., Inc., 22 F. Supp. 2d 1013, 1020 (D. Minn. 1998), further supports Honeywell’s position. In Barnes, the employer required employees to answer a medical questionnaire, which would then be provided to the insurer for the purpose of assessing risks and calculating premium prices for the company’s group healthcare plan. Id. at 1017. Employees who refused to participate were not eligible for coverage. Id. The district court held that this process was permissible under the ADA’s safe harbor provision, because “the questions were part of the routine procedures undertaken by [the insurer] in assessing the risks involved in insuring a group of employees. Such questions are permitted by the ADA.” Id. at 1021. Importantly, the courts in Seff and Barnes found that the safe harbor provision applies regardless of whether the wellness program is voluntary or not. Seff, 691 F.3d at 1222-24; Barnes, 22 F. Supp. 2d at 1017. In fact, in Barnes, employees who did not participate in the medical questionnaire were ineligible for coverage under the health plan, and the plaintiff was terminated for refusing to submit the medical questionnaire. Barnes, 22 F. Supp. 2d at 1017. Thus, Honeywell is not required to show that its wellness program is voluntary to be covered by the insurance safe harbor provision. Clearly, the EEOC cannot establish it is likely to succeed in this action when the only case law addressing the issue directly contradicts the EEOC’s position.

27


Nonetheless, even if the safe harbor provision did not apply, as demonstrated below, Honeywell’s wellness program is voluntary, and is thus also consistent with another provision of the ADA that permits the use of voluntary wellness programs. 2.

The HDHP Wellness Program Also Is Permissible Under The ADA’s Voluntary Wellness Program Provision.

Honeywell’s wellness program also is valid under the separate ADA provision that permits employers to request medical examinations in connection with voluntary wellness programs.

Under 42 U.S.C. § 12112(d)(4)(B), employers “may conduct

voluntary medical examinations, including voluntary medical histories, which are part of an employee health program . . . .” Honeywell’s wellness program is voluntary.

Merely providing a financial

incentive to participate in a program does not transform it into an involuntary program. As noted above, Honeywell employees are not subject to any discipline or loss of coverage for electing not to participate in biometric screening.

Gregg Decl. ¶ 21.

Individuals who choose to participate in Honeywell’s program simply pay less than those who choose not to participate. Id. ¶ 20. Non-participants pay approximately $42 per month (pre-tax) more than participants (as well as a possible $84 per month tobacco surcharge if they do not take steps to avoid that surcharge).7 Id. Surcharges applicable to participatory wellness programs (e.g., Honeywell’s $500 surcharge related to biometric screenings) are both encouraged and permissible under the

7

All three of the complainants (and any covered spouses) certified last year that they are not tobacco users, so none of them should face a tobacco surcharge. Id. at ¶ 27. 28


ACA and HIPAA.8 Indeed, in the ACA, Congress expressly approved and expanded the imposition of surcharges in order to encourage participation in employer wellness initiatives and to allow employers to distinguish between tobacco users and non-users.9 Such surcharges are permissible under the ACA so long as they do not exceed 30% of the cost of medical coverage, or, for tobacco-related wellness programs, 50% of the cost of medical coverage.10 8

Importantly, the ACA expressly provides that discounts and

As originally enacted in 1997, HIPAA did not specifically address wellness programs; rather, it simply included a general prohibition against provisions in employer group health plans that discriminated against employees with respect to their plan participation based on factors such as health status, medical conditions, or claims experience. See ERISA Section 702(a), 29 U.S.C. §1182(a). In response to concerns from employers that their wellness programs could be deemed to violate these HIPAA nondiscrimination standards, the Department of Labor, in 2006, issued final regulations under ERISA Section 702 specifically exempting wellness programs from the HIPAA nondiscrimination rules if they met certain requirements. See generally Department of Labor Regulations, 29 C.F.R. §2590.702(f). Those wellness requirements, which included a 20% cap (based on the applicable COBRA premium) on “rewards” offered for participation in certain types of wellness activities, were later specifically adopted by Congress in the provisions of the ACA, and in fact Congress doubled down on those requirements by authorizing that the cap on “rewards” be increased to 30%, and authorizing the agencies enforcing the provisions of HIPAA to increase the cap to 50%. See ERISA Section 715, as added by P.L. 111148, §1563(e) (incorporating by reference amendments to the HIPAA nondiscrimination rules made by ACA and set forth in the Public Health Service Act); Public Health Service Act, 42 U.S.C. § 2705(j). In addition, the wellness regulations under Section 702 of ERISA, as amended following the ACA, permit the use of an increased “reward” of up to 50% of the applicable COBRA premium for wellness programs aimed at tobacco usage. See Department of Labor Regulations, 29 C.F.R. § 2590.702(f)(5)(i) (“For purposes of this paragraph (f), the applicable percentage is 30 percent, except that the applicable percentage is increased by an additional 20 percentage points (to 50 percent) to the extent that the additional percentage is in connection with a program designed to prevent or reduce tobacco use.”).

9

Id.

10

Id. 29


surcharges are treated exactly the same. See 42 U.S.C. § 2705(j)(3)(A) (“A reward may be in the form of a discount or rebate of a premium or contribution, a waiver of all or part of a cost-sharing mechanism (such as deductibles, copayments, or coinsurance), the absence of a surcharge, or the value of a benefit that would otherwise not be provided under the plan.”) (emphasis added); Department of Labor Regulations, 29 C.F.R. § 2590.702(f)(1)(ii) (defining “reward” to include “imposing a penalty (such as a surcharge or other financial or nonfinancial disincentive).”). All applicable surcharges in the Honeywell wellness program comply with these surcharge limits, further demonstrating the reasonableness and non-coercive nature of the surcharges. Gregg Decl. ¶ 34. Thus, there is a clear Congressional mandate that non-tobacco users should not have to subsidize the cost of healthcare for tobacco users, who significantly increase the cost of healthcare for everyone, and Congress’ express endorsement of surcharges in the ACA irrefutably demonstrates that Congress does not view such surcharges as a violation of the ADA.11 Congress would not expressly endorse in one federal statute what is illegal under another pre-existing federal statute. The EEOC makes the unremarkable argument that mere compliance with the ACA does not automatically mean there is compliance with the ADA.

However, the EEOC ignores the equally well-established rule that

statutes regarding the same subject matter should be interpreted consistently.

See

Linquist v. Bowen, 813 F.2d 884, 888 (8th Cir. 1987) (rejecting agency interpretation of

11

See supra at n.9. 30


statute that conflicted with plain language and legislative history of another related statute because “[a] primary rule of statutory construction is that when a court interprets multiple statutes dealing with a related subject or object, the statutes are in pari material and must be considered together.”). Under this principle, the ADA should be read consistently with Congress’ recent legislation endorsing incentives/surcharges that encourage participation in wellness programs. Here, both the ACA and the ADA deal with wellness programs, and they should be considered together and interpreted consistently with one another. Id. To the extent the EEOC relies on its own informal enforcement guidance for the proposition that any penalty destroys voluntariness, this enforcement guidance is not entitled to deference and should be rejected. See Christensen v. Harris County, 529 U.S. 576, 587 (2000) (emphasis added) (citations omitted) (agency “policy statements, agency manuals, and enforcement guidelines” are not entitled to deference and “lack the force of law.”); Center for Special Needs Trust Admin., Inc. v. Olson, 676 F.3d 688, 701 & n.4 (8th Cir. 2012) (holding that district court should not have relied on informal agency guidance because such pronouncements are not based on formal adjudication or rulemaking, do not have “the force of law” and are not entitled to deference from courts). Courts have rejected the EEOC’s Enforcement Guidance on Disability-Related Inquiries and Medical Examinations of Employees Under the ADA because it is not binding on a court, is not entitled to deference, and is contrary to the plain language of the ADA. See EEOC v. C.R. England, Inc., 644 F.3d 1028, 1047 (10th Cir. 2011) (rejecting this enforcement guidance because the “EEOC’s interpretations are not controlling” and the 31


“EEOC’s guidance does not persuade us because it is not consistent with the plain language of the statute.”); EEOC v. U.S. Steel Corp., No. 10-12, 2013 WL 625315, at *21 (W.D. Pa. Feb. 20, 2013) (rejecting same guidance for similar reasons). For the same reasons, the EEOC’s informal enforcement guidance should be rejected in this case. The EEOC attempts to create an artificial distinction between incentives and surcharges, but this distinction not only contradicts the ACA, but is also meaningless. Incentives and surcharges are two sides of the same coin. Incentivizing employees to participate in biometric screening by offering participants a $42 per month contribution reduction produces precisely the same economic result as assessing nonparticipants a $42 per month contribution surcharge. In both instances, the participant pays $42 less than the non-participant.

Both the ACA and the HIPAA wellness

regulations under ERISA Section 702 expressly recognize this principle and expressly provide that incentives and penalties produce the same result and are both treated the same.

See supra at 28-31.

The voluntariness requirement in the ADA should be

interpreted in the same manner. The EEOC also attempts to show that Honeywell’s wellness program is involuntary by grossly overstating the surcharges that Honeywell employees incur if they choose not to participate in biometric screening.

First, the EEOC repeatedly

mischaracterizes the company HSA contribution as an additional “penalty,” but the indisputable record evidence shows that it is an incentive, for which an employee is only eligible if they participate in the program. See Gregg Decl. ¶ 19 & Ex B, FAQ 6. Second, the EEOC improperly assumes that all employees and spouses who choose not to 32


participate in the biometric screening will be assessed a $1,000 tobacco surcharge, but this simply is not true. Employees and their spouses who choose not to participate in biometric screening easily can avoid – and many have avoided – a tobacco surcharge by merely picking up the phone and certifying to a third party administrator that they do not use tobacco. Id. at ¶ 30; Ex. B, FAQs 22-23; Exhibits C & D. The sole surcharge that results from choosing not to participate in biometric testing is $500, as there is no surcharge for a spouse refusing to participate in screening.12 The EEOC also overstates the economic ramifications Mr. Hall and Ms. Schwartz with regard to tobacco surcharges.

Mr. Hall nor his wife are tobacco users, and they

would have been able to avoid the tobacco surcharges this year by simply calling a Health Advocate and certifying that they do not use tobacco – just like they both did last year. Gregg Decl. ¶¶ 27, 30. Thus, they would not have incurred $2,000 in tobacco surcharges. Similarly, even though Ms. Schwartz has stated in her declaration that she does not smoke, the EEOC improperly includes a tobacco surcharge in its calculations for her as well. See Dkt. No. 6, Schwartz Decl. ¶ 8(c). Thus, contrary to the EEOC’s exaggeration, in reality, the only surcharge both Ms. Schwartz and Mr. Hall would have incurred if they chose not to participate in biometric screening is the modest $500 biometric surcharge. The same would also be true for the recent charging party, Mr. Aguirre, who has previously certified that neither he nor his wife is a tobacco user. Gregg Decl. ¶ 30. 12

Employees do not incur a $500 biometric surcharge if their spouse chooses not to participate in biometric screening. 33


For all of these reasons, Honeywell’s wellness program qualifies as a voluntary wellness program and is fully compliant with the ADA. 3.

The HDHP Wellness Program Also Complies With GINA.

Honeywell’s wellness program also fully complies with GINA. GINA Section 101(d)(1) prohibits group health plans from requesting or acquiring “genetic information.” 29 U.S.C. § 1182(b)(3). “The term ‘genetic information’ means, with respect to any individual, information about—(i) such individual’s genetic tests, (ii) the genetic tests of family members of such individual, and (iii) the manifestation of a disease or disorder in family members of such individual.” 29 U.S.C. § 1191b(d)(6). “Genetic test” means an “analysis of human DNA, RNA, chromosomes, proteins, or metabolites, that detects genotypes, mutations, or chromosomal changes.”

Id. at

§ 1191b(d)(7). The biometric screening offered to Honeywell employees and spouses clearly does not constitute “genetic testing” and does not collect any “genetic information.” The FAQs issued by the Department of Labor regarding Title I of GINA expressly recognize that “[g]enetic information means information about an individual’s genetic tests.” See Dep’t of Labor, FAQs on the Genetic Information Nondiscrimination Act, available at http://www.dol.gov/ebsa/faqs/faq-GINA.html. This guidance further provides that “an

34


HIV test, complete blood count, cholesterol test, liver function test, or test for the presence of alcohol or drugs is not a genetic test.” Id.13 Honeywell’s biometric screening is strictly limited to recording the employee or spouse’s blood pressure, HDL cholesterol level, total cholesterol level, glucose level, height, weight, waist circumference, and nicotine level. See Gregg Decl. ¶¶ 11-12 & Exhibit B, Frequently Asked Questions, at Q&A 6-7. The biometric screening does not analyze “DNA, RNA, chromosomes, proteins or metabolites,” nor does it “detect[] genotypes, mutations or chromosomal changes,” and it is entirely consistent with the types of tests the Department of Labor has expressly approved in its FAQs. 29 U.S.C. § 1191b(d)(7). The biometric screening also does not contain any health questionnaire and it in no way inquires about family health history. See Gregg Decl. ¶ 12. As a result, there is no colorable argument that Honeywell’s limited biometric screening violates GINA. Contrary to the EEOC’s argument that asking a spouse to participate in biometric screening collects impermissible genetic information or “family medical history” regarding the employee, there is no basis for this assertion in the text of GINA, in the Department of Labor guidance cited above, or in what is actually performed in the limited biometric screening. Honeywell’s biometric screening does not contain any health questionnaire and does not collect any genetic information. GINA contains no

13

Although not binding in Title I actions, EEOC’s regulations under Title II of GINA contain the same definition of genetic testing, and they exempt the same tests from coverage as the Department of Labor FAQs. See 29 C.F.R. § 1635.3(f). 35


language that could be reasonably read to suggest that obtaining biometric screening from a spouse constitutes the collection of a “family medical history.” No genetic information whatsoever regarding the employee is revealed by any test of the spouse, let alone the very limited biometric screening at issue here, which the Department of Labor has expressly approved. Just as the only courts to consider the EEOC’s ADA insurance safe harbor argument have rejected it, the only court to consider the EEOC’s GINA argument also has rejected it. In Poore v. Peterbilt of Bristol, LLC, 852 F. Supp. 2d 727 (W.D. Va. 2012), the plaintiff similarly argued that his employer violated GINA by requesting and obtaining a health insurance questionnaire from the plaintiff that inquired about “his family’s general medical conditions and medications.” Id. at 728. The plaintiff disclosed on this form that his wife had been diagnosed with multiple sclerosis, and three days later he was terminated. Id. The court granted the employer summary judgment on the plaintiff’s GINA claim because his wife’s medical history “does not constitute ‘genetic information with respect to the employee.’” Id. at 731. The court relied on GINA’s legislative history, which reveals that “[t]he basic intent of GINA is to prohibit [insurers and] employers from making a ‘predictive assessment concerning an individual’s propensity to get an inheritable genetic disease or disorder based on the occurrence of an inheritable disease or disorder in [a] family member.’” Id. (quoting H.R. Rep. No. 110– 28, pt. 3, at 70 (2007), 2008 U.S.C.C.A.N. 112, 141). The legislative history further reveals that “‘Congress included family medical history in the definition of ‘genetic information’ because it understood that employers could potentially use family medical 36


history ‘as a surrogate for genetic traits.’” Id. (quoting H.R. Rep. No. 110–28, pt. 1, at 36 (2007), 2008 U.S.C.C.A.N. 66, 80; S. Rep. No. 110–48, at 16 (2007)). Accordingly, Congress only intended for information about family members’ diseases and disorders to be “considered ‘genetic information’ if ‘such information is taken into account only with respect to the individual in which such disease or disorder occurs and not as genetic information with respect to any other individual.’” Id. (quoting H.R. Rep. No. 110–28, pt. 2, at 27 (2007), 2008 U.S.C.C.A.N. 101, 105–106)). In the Poore case, the court concluded that [t]he fact that Poore’s wife was diagnosed with multiple sclerosis has no predictive value with respect to Poore’s genetic propensity to acquire the disease” and thus, her medical history did not constitute “genetic information” under GINA. Id. The same is true here. The biometric screening results of Honeywell employees’ spouses are limited to their blood pressure, HDL cholesterol level, total cholesterol level, glucose level, height, weight, waist circumference, and nicotine level. This information has no “predictive value” with respect to the employees’ “genetic propensity to acquire [any] disease,” and thus it does not constitute genetic information about the employees under GINA. Id. Again, the EEOC cannot show likelihood of success on the GINA claim where the only case law addressing this issue is directly contrary to the EEOC’s position. Finally, even if the wellness program violated GINA (which it does not), GINA Title I applies to Honeywell’s wellness program because it is a part of a bona fide group health plan. See GINA Section 101(a). The EEOC’s jurisdiction is limited to enforcing Title II of GINA, and the EEOC thus has no jurisdiction to litigate whether the HDHP 37


and the wellness program comply with GINA. Moreover, even if Title II of GINA applied to this case (which it does not), and even if biometric screening results of a spouse constituted genetic information of the employee (which they do not), like the ADA, Title II of GINA contains an express exception that permits employers to request and acquire genetic information in connection with voluntary wellness programs. See GINA Section 202(b)(2). For all of the reasons discussed supra, Honeywell’s wellness program is voluntary and there is no surcharge if a spouse refuses to do the biometric screening. Gregg Decl. ¶ 20. Thus, Honeywell’s wellness program does not violate Title II of GINA. Accordingly, for all of these reasons, the EEOC is not likely to succeed on the merits of its claims under the ADA and GINA, and Plaintiff’s Motion should be denied. D.

The Harm To Honeywell And Its Employees If The Temporary Restraining Order Is Erroneously Granted Outweighs Any Potential Economic Harm To Honeywell Employees.

Plaintiff’s Motion for Temporary Restraining Order also should be denied because the balance of harms weighs decidedly against a temporary restraining order. While the only harm Honeywell employees could potentially suffer if the temporary restraining order is denied is economic harm that they ultimately could recover as damages, Honeywell will suffer substantial, irreparable harm if the temporary restraining order is granted. Should the Court grant Plaintiff’s Motion, Honeywell have to immediately rewrite and implement an amended HDHP on an emergency basis during the middle of open enrollment. See Gregg Decl. ¶ 37. If Honeywell later ultimately prevails on the merits, this damage cannot be undone. Honeywell will not be able to go back in time to 38


implement the 2015 HDHP in its current (lawful) form. As the court recognized in Anchor Hocking, “one reason the courts have traditionally been reluctant to issue preliminary injunctions is that judicial intervention before the merits have been finally determined frequently imposes a burden on defendant that ultimately turns out to be unjustified.” 666 F.2d at 1043 (internal quotations omitted). This Court also should decline to impose on Honeywell the tremendous burden of interrupting and recreating the 2015 HDHP until a final determination is reached in this litigation. In addition, if Honeywell is forced to suspend its biometric surcharges, employees will be told that there will be no surcharges for non-participation. If they then choose not to do the biometric screening, such employees will not have the ability to make a different health plan choice during the year, and will incur the surcharges if Honeywell later prevails.14 In other words, employees will be deprived of the ability to make an accurate, fully-informed economic choice. In addition, if Honeywell is required to fund HSA accounts for employees who refuse to participate in the wellness program, as the EEOC demands, Honeywell will not be able to recoup the HSA funds under applicable IRS rules if it later prevails.15 In contrast, if employees choose not to do the screening now and the EEOC later prevails, they can simply be reimbursed for any surcharges that

14

See 26 C.F.R. §1.125-4.

15

See Internal Revenue Code, 26 U.S.C. § 223(d)(1)(E) (2010) (HSA account balances must be “nonforfeitable”). HSA contributions belong to the employees once made, and Honeywell has no ability to rescind or recover those contributions if it prevails, other than to bring individual actions against all the affected employees to recover those contributions, which would clearly be impractical. 39


they incur and be provided any HSA contributions they did not receive during the months before a decision on the merits. Moreover, an injunction would likely cause some Honeywell employees and their spouses who have not yet chosen to participate in screening not to do so. Studies have shown that employees who choose to participate in biometric screening are more informed about their health risks and are more likely to take steps to reduce their health risks.

Id. ¶ 41.

Studies have further shown that reducing health risks results in

substantially reduced healthcare costs. Id. Honeywell and its employees will suffer substantial harm in the form of healthcare costs that could have been avoided if they had participated in biometric screening and had the opportunity to reduce their health risks. Id. ¶ 43. There will be no opportunity to avoid or recoup these healthcare costs later if Honeywell ultimately prevails in this action. Finally, erroneously granting injunctive relief also will cause harm to the thousands of Honeywell employees who already have voluntarily chosen to participate in biometric screening for 2015 (including each of the charging parties). See id. ¶ 40. These employees chose the bargain of a lower HDHP employee contribution rate by participating in biometric screening. Honeywell’s cost to provide the HDHP is fixed, and if Honeywell is forced to eliminate the biometric surcharge, the employee contribution likely will go up for each and every employee to compensate for the lost surcharge funding. Id. ¶¶ 39-40. The thousands of employees who already have participated in biometric screening will lose the benefit of their bargain, their contribution amounts

40


likely will increase, and that harm cannot later be redressed, even if Honeywell ultimately prevails on the merits. Id. For all of these reasons, the harm that Honeywell and its thousands of employees will suffer substantially outweighs the purely monetary harm that Honeywell employees who choose to forego the biometric screening will suffer if they must, beginning in January 2015, pay a monthly surcharge while the EEOC adjudicates this lawsuit on their behalf. Plaintiff’s Motion should therefore be denied. E.

The Public Interest Will Not Be Harmed By The Denial Of The Temporary Restraining Order.

The public interest also favors wellness programs and reducing health care costs, as evidenced by the ACA. Granting injunctive relief would undermine the purposes and goals of the ACA by striking down precisely the sort of wellness program that the ACA seeks to encourage on grounds that directly conflict with ACA provisions permitting surcharges to encourage employee participation in wellness programs. See supra at 2831. In addition, the EEOC’s argument that the public interest favors an injunction to further the purposes of the ADA and GINA is without merit. Contrary to the concerns underlying the ADA, here, Honeywell does not get access to any individual results of the biometric screenings. Gregg Decl. ¶ 16. There is absolutely no basis to assert that emergency injunctive relief is needed to protect employees from any of the harms designed to be protected by the ADA. The same is true for GINA since a biometric screening is not a genetic test and Honeywell does not get access to the information. Id.; 29 U.S.C. § 1191b(d)(7). Finally, the EEOC’s requested relief would likely only cause

41


certain employees not to engage in biometric screening, and it is simply not in the public interest to discourage employees from learning about their health status and learning about ways to improve their health. IV.

CONCLUSION

Temporary restraining orders are extraordinary remedies, not to be granted except in the clearest of cases. Plaintiff has failed to carry its burden that such a far-reaching remedy is warranted here. For all of the foregoing reasons, Honeywell respectfully requests that the Court deny Plaintiff’s Motion in its entirety. Date: October 30, 2014

Respectfully submitted, /s/ Michael S. Burkhardt MORGAN, LEWIS & BOCKIUS LLP Michael S. Burkhardt (pro hac vice) 1701 Market Street Philadelphia, PA 19103 Telephone: 215.963.5130 Facsimile: 215.963.5001 [email protected] John G. Ferreira (pro hac vice) Lauren E. Marzullo (pro hac vice) One Oxford Centre, 301 Grant Street 32nd Floor Pittsburgh, PA 15219 Telephone: 412-560-7000 Facsimile: 412-560-7001 [email protected] [email protected] Andy R. Anderson (pro hac vice) 77 West Wacker Dr. Chicago, IL 60601 Telephone: 312.324.1177 Facsimile: 312.324.1001 42


[email protected] FAEGRE BAKER DANIELS LLP Charles F. Knapp (Bar No. 220371) Sean R. Somermeyer (Bar No. 391544) 2200 Wells Fargo Center 90 South Seventh Street Minneapolis, MN 55402-3901 Telephone: 612.766.7000 Facsimile: 612.766.1600 Attorneys for Defendant Honeywell International Inc.

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CERTIFICATE OF SERVICE I hereby certify that on October 30, 2014, I caused Defendant’s Opposition, Declaration and Exhibits in Support thereof to be filed electronically with the Clerk of Court through the Court’s ECF System and served to all parties of record.

/s/ Michael S. Burkhardt Michael S. Burkhardt