PRIVILEGED AND CONFIDENTIAL — ATTORNEY-CLIENT PRIVILEGE / ATTORNEY WORK PRODUCT
CALDERWOOD & HARKNESS LLP INITIAL CASE ASSESSMENT MEMORANDUM
DATE: April 12, 2022
TO: Bernard Crawford, Partner Renata Vasquez, Partner
FROM: Nadia Petrov, Associate James Underwood, Associate
RE: Initial Case Assessment — Darren K. Maciejewski v. Nexford Industrial Holdings Inc., Case No. 2022-L-002847, Circuit Court of Cook County, Illinois, County Department, Law Division
PURPOSE: To provide a comprehensive analysis of the complaint, assess factual and legal strengths and weaknesses, estimate potential exposure, and recommend a defense strategy.
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I. EXECUTIVE SUMMARY
This memorandum provides an initial case assessment of Darren K. Maciejewski v. Nexford Industrial Holdings Inc., Case No. 2022-L-002847, a single-plaintiff retaliation action filed on March 15, 2022, in the Circuit Court of Cook County, Illinois, County Department, Law Division. The case has been assigned to Judge Helena R. Vasquez-Torres. Plaintiff is represented by Gerald P. Hess of Hess & Loughlin, P.C., a small general-practice firm in Berwyn, Illinois.
Plaintiff Darren K. Maciejewski, age 47, is a former Senior Quality Assurance Supervisor who was employed by Nexford Industrial Holdings Inc. ("Nexford" or "NIH") at its Elgin, Illinois manufacturing facility from June 12, 2017 through September 24, 2021. Maciejewski alleges that his termination on September 24, 2021 was in retaliation for internal safety reports he made to management and an OSHA complaint (Complaint No. 1734892) he filed on June 8, 2021 regarding chemical storage conditions at Nexford's Elgin facility. Nexford is an Illinois-headquartered, Delaware-incorporated industrial manufacturing company specializing in precision-machined components for heavy equipment and infrastructure applications.
The Complaint asserts three counts: (I) Retaliatory Discharge under Illinois common law; (II) Retaliation under Section 11(c) of the Occupational Safety and Health Act ("OSH Act"), 29 U.S.C. § 660(c); and (III) Violation of the Illinois Whistleblower Act, 740 ILCS 174/1 et seq. Plaintiff seeks back pay, front pay, compensatory damages of $150,000 for emotional distress, punitive damages of $500,000, and attorneys' fees and costs.
Nexford maintains that Maciejewski was terminated for documented, repeated violations of the company's attendance and tardiness policy as set forth in Employee Handbook § 4.3, following progressive discipline that began before the OSHA complaint was filed. Critically, OSHA investigated Maciejewski's complaint, conducted an on-site inspection of the Elgin facility on July 12, 2021, and closed the matter on August 18, 2021 with no citations issued and no findings of any violation. This result independently corroborates Nexford's internal Environmental Health & Safety Department's earlier conclusion that Building C chemical storage was compliant with applicable regulations.
Based on our analysis, we estimate Nexford's internal worst-case damages exposure at approximately $285,000, inclusive of back pay, front pay, potential emotional distress damages, statutory fees and costs, and a nominal/residual allocation for punitive damages risk. This figure falls well within the per-occurrence limit of the company's Employment Practices Liability Insurance ("EPLI") policy with Verdant Mutual Insurance Company.
Our overall assessment is that Nexford has strong defenses on all three counts. Count II (Section 11(c) of the OSH Act) is procedurally vulnerable and likely subject to early dismissal for failure to exhaust administrative remedies, as there is no private right of action under the statute. Counts I and III present closer factual questions but are defensible given the well-documented progressive discipline record, the predating nature of the first written warning, and the OSHA finding of no violation. We recommend that Nexford mount a vigorous defense of this action rather than pursue early settlement.
II. PARTIES
A. Defendant — Nexford Industrial Holdings Inc.
Nexford Industrial Holdings Inc. is a corporation organized and existing under the laws of the State of Delaware, with its principal place of business and corporate headquarters located at 500 Commerce Drive, Suite 400, Schaumburg, Illinois 60173. Nexford is an industrial manufacturing company specializing in the design, production, and distribution of precision-machined components for heavy equipment, infrastructure, and related industrial applications. The company holds itself out as a leading supplier in the Midwestern manufacturing sector.
Nexford operates three manufacturing facilities in the greater Chicago metropolitan area:
• Elgin Facility — 2700 Industrial Parkway, Elgin, IL 60123 (the facility at issue in this litigation);
• Rockford Facility — 1180 Auburn Road, Rockford, IL 61101; and
• Joliet Facility — 4455 Larkin Avenue, Joliet, IL 60435.
The company employs approximately 1,400 individuals across all three facilities and its Schaumburg headquarters. Nexford's annual revenues are approximately $185 million.
Nexford is a portfolio company of Harborview Partners, a mid-market private equity firm headquartered in Charlotte, North Carolina. Veltrano acquired a 72% controlling interest in Nexford in October 2019 for approximately $310 million. The remaining equity is held by management and prior investors.
Key personnel relevant to this matter include the following:
• Richard Yoon — Chief Executive Officer
• Tara Svendsen — General Counsel
• Catherine "Cat" Donnelly — Vice President, Human Resources
• Frank Bosch — Plant Manager, Elgin Facility
• Liam Gallagher — Director, Environmental Health & Safety
Nexford's registered agent in the State of Illinois is CT Agents Inc., located at 208 South LaSalle Street, Suite 814, Springfield, Illinois 62701. Service of the summons and complaint in this action was effected upon the registered agent on March 22, 2022.
B. Plaintiff — Darren K. Maciejewski
Darren K. Maciejewski was 47 years of age at the time the Complaint was filed. Maciejewski was employed by Nexford from June 12, 2017 through September 24, 2021, a period of approximately four years and three months, working exclusively at the Elgin facility.
Maciejewski was initially hired as a Quality Assurance Supervisor at a starting annual salary of $64,000 per year. He reported to Plant Manager Frank Bosch at the Elgin facility, which is Nexford's primary manufacturing site for machined valve components and serves as the company's largest single production operation with approximately 340 employees.
In March 2019, Maciejewski was promoted to the position of Senior Quality Assurance Supervisor. At that time, his annual salary was increased to $72,500 per year, reflecting expanded responsibilities including oversight of quality protocols for the Building C production line and supervisory authority over a team of four Quality Assurance Technicians.
In January 2021, Maciejewski received a merit-based salary increase to $78,400 per year — an increase of $5,900, or approximately 8.1%, reflecting the cumulative adjustment for the two-year period since his last salary adjustment at the time of his promotion. His final annual salary at the time of his termination on September 24, 2021 was $78,400, equating to a monthly salary of approximately $6,533.33.
The Complaint does not identify any protected-class characteristics, and no discrimination claims are asserted. The action is framed exclusively as a retaliation claim.
C. Plaintiff's Counsel — Gerald P. Hess / Hess & Loughlin, P.C.
Plaintiff is represented by Gerald P. Hess of Hess & Loughlin, P.C., located at 3412 Harlem Avenue, Suite 205, Berwyn, Illinois 60402. Notwithstanding the firm name, our investigation indicates that Mr. Hess is a sole practitioner operating under the professional corporation name "Hess & Loughlin, P.C." There are no other attorneys currently associated with the firm. Mr. Hess's ARDC license is active and in good standing.
Mr. Hess's practice appears to be a general practice with a focus on personal injury and employment-side plaintiff's work. A review of publicly available court records reveals that Mr. Hess has handled a modest number of employment matters in state court, but he does not appear to be a specialist in employment retaliation litigation. This observation may bear on the quality and aggressiveness of the litigation we can expect from opposing counsel, though we should not assume that Mr. Hess will be unable to prosecute the case competently.
D. Insurance Coverage
Nexford maintains Employment Practices Liability Insurance ("EPLI") through Verdant Mutual Insurance Company, under Policy No. EPLI-VM-2021-04782. The material terms of coverage relevant to this matter are as follows:
• Per-Occurrence Limit: $2,000,000
• Aggregate Limit: $5,000,000
• Self-Insured Retention ("SIR"): $50,000
Nexford's General Counsel, Tara Svendsen, notified Verdant Mutual of this action on March 28, 2022, promptly after receiving the forwarded summons and complaint from CT Agents Inc. On the same date, Ms. Svendsen contacted Calderwood & Harkness LLP regarding representation.
Verdant Mutual has acknowledged coverage of this matter, subject to a reservation of rights. The assigned claims adjuster is Brianna Choi. Calderwood & Harkness has been approved as panel counsel for the defense of this action.
Defense costs — including attorneys' fees and litigation expenses — will initially erode the $50,000 SIR. Once the SIR is exhausted, Verdant Mutual will be responsible for the payment of defense costs and any covered indemnity amounts up to the per-occurrence limit. As discussed in Section VI below, the worst-case exposure in this matter ($285,000) falls well within the per-occurrence limit.
E. Equity Sponsor — Harborview Partners
Harborview Partners is a mid-market private equity firm headquartered at 401 South Tryon Street, Suite 2800, Charlotte, North Carolina 28202. Veltrano holds a 72% controlling interest in Nexford, acquired in October 2019.
The operating partner assigned to the Nexford portfolio investment is Malcolm Driscoll. As a condition of the investment and pursuant to the operating agreement and management services agreement between Veltrano and Nexford, Veltrano requires quarterly litigation exposure reports for any matter with potential exposure exceeding $50,000. This reporting obligation encompasses both pending litigation and pre-litigation disputes that may reasonably result in claims exceeding the threshold.
This matter exceeds the $50,000 threshold, and accordingly, quarterly litigation exposure reports will be required. Reports will be transmitted through Tara Svendsen to Malcolm Driscoll. The first such report should be prepared and delivered in connection with the next quarterly reporting cycle.
III. PROCEDURAL HISTORY
The procedural history of this matter to date is as follows:
The case is presently in its earliest stages. No responsive pleading has yet been filed, discovery has not commenced, and no substantive motions are pending. The immediate priorities are (1) the preparation and filing of Nexford's Answer and Affirmative Defenses by the April 18, 2022 deadline, and (2) preparation for the Initial Case Management Conference on April 28, 2022, at which the Court will likely establish a discovery schedule and set future case management deadlines.
IV. FACTUAL BACKGROUND
A. Maciejewski's Employment History
Darren K. Maciejewski was hired by Nexford Industrial Holdings Inc. on June 12, 2017, as a Quality Assurance Supervisor at the company's Elgin, Illinois manufacturing facility, located at 2700 Industrial Parkway, Elgin, IL 60123. The Elgin facility employs approximately 340 individuals and serves as Nexford's primary manufacturing site for machined valve components. Maciejewski's starting annual salary was $64,000 per year.
Throughout his employment, Maciejewski reported to Frank Bosch, the Plant Manager of the Elgin facility. Maciejewski's role involved oversight of quality assurance processes on the production floor, including inspection protocols, compliance with internal quality standards, and coordination with the Environmental Health & Safety ("EHS") Department on matters affecting product quality and workplace safety.
In March 2019, approximately twenty-one months after his initial hire, Maciejewski was promoted to the position of Senior Quality Assurance Supervisor. The promotion reflected management's recognition of his performance and expanded his responsibilities to include supervisory authority over a team of Quality Assurance Technicians and additional oversight of the Building C production line. His annual salary was increased to $72,500 per year in connection with the promotion.
In January 2021, Maciejewski received a merit-based salary increase to $78,400 per year. This represented an increase of $5,900, or approximately 8.1%, and reflected the cumulative merit adjustments for the two-year period since his promotion. Maciejewski's final annual salary at the time of his termination on September 24, 2021 was $78,400, equating to approximately $6,533.33 per month.
It bears noting that the trajectory of Maciejewski's employment — from initial hire through promotion and subsequent merit increase — is inconsistent with a narrative of employer animus. Nexford treated Maciejewski favorably throughout the majority of his tenure. The disciplinary issues that ultimately led to his termination did not emerge until the spring of 2021, more than three and a half years into his employment.
B. Maciejewski's Safety Reports and OSHA Complaint
The central factual predicate for Plaintiff's retaliation claims is a series of safety reports Maciejewski made internally and to OSHA in the spring and summer of 2021 concerning chemical storage conditions in Building C of the Elgin facility. The chronology is as follows:
April 5, 2021 — First Internal Safety Report. Maciejewski made his first internal report to his direct supervisor, Frank Bosch, regarding what he believed were unsafe chemical storage conditions in Building C. The specific nature of his concerns, as described in the Complaint and as corroborated by the internal records reviewed to date, related to the storage of flammable liquids — principally acetone and isopropanol (Class 3 flammable liquids) — in quantities that Maciejewski believed exceeded the rated capacity of the storage cabinets in Building C. The report was made verbally and followed up in writing. The method of the initial report — to Maciejewski's direct supervisor — was consistent with Nexford's internal reporting protocols.
April 19, 2021 — Follow-Up Internal Report. Approximately two weeks later, Maciejewski sent a follow-up report via email to Nexford's Environmental Health & Safety Department, directed to its Director, Liam Gallagher. In this communication, Maciejewski reiterated his concerns regarding chemical storage in Building C and indicated that he had not received a substantive response to his initial report to Bosch. The email is among the documents identified for production (Bates NIH-000001 through NIH-000847).
May 3, 2021 — EHS Department Response. Liam Gallagher and the EHS Department responded to Maciejewski's reports. The EHS Department's response concluded that chemical storage in Building C was compliant with applicable regulations, including the Occupational Safety and Health Administration standards governing the storage of flammable and combustible liquids (29 C.F.R. § 1910.106). The EHS response did, however, recommend minor labeling improvements to certain storage cabinets to enhance clarity and readability. The substance of the EHS response is significant: Nexford's own internal investigation reached the same conclusion that OSHA would later reach — no violation existed.
June 8, 2021 — OSHA Complaint Filed. Approximately five weeks after receiving the EHS Department's response, Maciejewski filed OSHA Complaint No. 1734892 with the OSHA Area Office located at 701 Lee Street, Suite 950, Des Plaines, Illinois 60016. In his complaint, Maciejewski alleged improper storage of Class 3 flammable liquids (acetone and isopropanol) in quantities exceeding approved cabinet capacity limits in Building C of the Elgin facility.
June 14, 2021 — OSHA Notification to Nexford. Nexford received notification from OSHA of the complaint on or about June 14, 2021. The notification was received by Liam Gallagher and forwarded to Tara Svendsen and Frank Bosch.
July 12, 2021 — OSHA Inspection. A Compliance Safety and Health Officer ("CSHO") assigned by the OSHA Area Office conducted an on-site inspection of Building C at the Elgin facility. The inspection focused on the specific allegations contained in Maciejewski's complaint — the storage of flammable liquids in Building C.
August 18, 2021 — OSHA Complaint Closed; No Citations. OSHA closed Complaint No. 1734892 with no citations issued and no findings of violation. The complaint was determined to be unsubstantiated based on the CSHO's inspection findings. The closure of the complaint without any adverse findings is a critically important defense fact: it independently corroborates Nexford's internal EHS conclusion that Building C was in compliance with applicable regulations.
The significance of OSHA's findings cannot be overstated. Maciejewski's core allegation is that he was terminated for raising legitimate safety concerns. However, both Nexford's own EHS Department and the federal agency charged with enforcing workplace safety standards independently concluded that the conditions Maciejewski complained about did not constitute violations. While the fact that no actual violation existed does not, standing alone, defeat a retaliation claim — an employee may be protected for raising concerns in good faith even if those concerns ultimately prove unfounded — the OSHA finding substantially undermines any inference that Nexford harbored retaliatory animus. A reasonable employer that learns a safety complaint has been investigated and found to be without merit has little reason to retaliate against the complainant.
C. Progressive Discipline and Termination
Concurrent with, and partially predating, Maciejewski's safety reporting activity, Nexford initiated progressive disciplinary action against Maciejewski for violations of the company's attendance and tardiness policy as set forth in Employee Handbook § 4.3. The timeline of disciplinary events is as follows:
Employee Handbook § 4.3 — Attendance and Tardiness Policy. Nexford's Employee Handbook, which Maciejewski acknowledged receiving upon hire (a signed acknowledgment is among the documents identified for production), sets forth the company's attendance and tardiness expectations and progressive discipline procedures. Under § 4.3, employees are expected to report to their assigned shifts on time. Repeated tardiness (defined as arrival more than 15 minutes after the start of a scheduled shift) and unexcused absences are subject to progressive discipline in the following sequence: (1) verbal warning; (2) first written warning; (3) final written warning; and (4) termination. The policy provides that an employee who accumulates a specified number of tardiness incidents or unexcused absences within a rolling period may be advanced through the progressive discipline steps and, ultimately, terminated.
May 24, 2021 — First Written Warning. Maciejewski received a first written warning for tardiness. The warning documented four instances in which Maciejewski arrived more than 15 minutes late to his scheduled shift within a 30-day period. The warning was issued by Frank Bosch and documented in Maciejewski's personnel file.
This date is of critical importance to the defense analysis: the first written warning was issued on May 24, 2021 — two full weeks before Maciejewski filed his OSHA complaint on June 8, 2021. The predating nature of the disciplinary action strongly supports the defense position that Nexford's attendance-related concerns arose independently of, and prior to, Maciejewski's protected activity. This fact will be central to Nexford's argument that the termination was based on a legitimate, non-retaliatory business reason.
August 2, 2021 — Final Written Warning. Maciejewski received a final written warning for continued attendance violations. The warning documented three additional incidents of unexcused tardiness occurring between June 1 and July 31, 2021. The final written warning was issued by Frank Bosch, with input from the Human Resources Department (Cat Donnelly), and explicitly advised Maciejewski that any further attendance violation would result in termination of his employment. The warning was signed by Maciejewski, acknowledging receipt.
September 20, 2021 — Unexcused Absence. Maciejewski failed to report for his scheduled shift on September 20, 2021 and did not call in to notify his supervisor or the plant of his absence. The absence was classified as unexcused under Employee Handbook § 4.3. Under the terms of the progressive discipline policy, this incident — occurring after a final written warning — constituted grounds for termination.
September 24, 2021 — Termination. A termination meeting was held on September 24, 2021, attended by Frank Bosch (Plant Manager) and Catherine "Cat" Donnelly (VP, Human Resources). Maciejewski was informed that his employment was being terminated effective immediately for violation of the company's attendance policy, following the completion of the progressive discipline process. The termination was documented in a separation memorandum, which is included in the documents identified for production.
The progressive discipline record is well-documented and consistent with Nexford's standard procedures. The disciplinary actions were signed by the appropriate supervisors and, in the case of the written warnings, by Maciejewski himself. The record demonstrates a rational, documented progression from first written warning to final written warning to termination, driven by specific, documented attendance violations.
D. Key Chronological Observations
The relative timing of the protected activity and the disciplinary/termination events is central to the analysis of this case. The following chronological observations are critical:
1. The first written warning (May 24, 2021) predates the OSHA complaint (June 8, 2021) by approximately two weeks. This is the single most important chronological fact for the defense. It demonstrates that Nexford's disciplinary concerns about Maciejewski's attendance arose and were acted upon before Maciejewski engaged in the external protected activity of filing an OSHA complaint. While Maciejewski's internal safety reports (April 5 and April 19, 2021) predate the first written warning, Nexford's EHS Department had already responded to those reports by May 3, 2021, and Nexford's position is that those internal reports had no bearing on the attendance-related discipline.
2. The final written warning (August 2, 2021) and the termination (September 24, 2021) both postdate the OSHA complaint (June 8, 2021). This creates a temporal proximity argument that Plaintiff will undoubtedly advance. The final written warning was issued approximately 55 days after the OSHA complaint, and the termination occurred approximately 108 days (3.5 months) after the OSHA complaint.
3. The approximately 3.5-month gap between the OSHA complaint and termination is close enough for Plaintiff to argue temporal proximity as circumstantial evidence of retaliatory motive. However, it is distant enough — particularly given the intervening, independently documented policy violations — to weaken the inference of retaliation, especially at the summary judgment stage.
4. OSHA's inspection occurred on July 12, 2021, and the complaint was closed with no citations on August 18, 2021 — both events occurring prior to the termination on September 24, 2021. By the time Maciejewski was terminated, Nexford knew that OSHA had found no violation. This further weakens the inference of retaliation: the purported basis for any retaliatory motive — Maciejewski's safety complaint — had been vindicated in Nexford's favor before the termination decision was made.
The overall chronological picture is favorable to the defense. The disciplinary record predates the external protected activity, the intervening violations are documented, and the OSHA complaint was resolved in Nexford's favor before the termination occurred.
V. ANALYSIS OF THE COMPLAINT
A. Count I — Retaliatory Discharge (Illinois Common Law)
1. Legal Standard
Under Illinois common law, the tort of retaliatory discharge provides an at-will employee with a cause of action when the employee is terminated in retaliation for exercising a right or fulfilling an obligation that is grounded in a clearly mandated public policy. The seminal case recognizing this tort is Kelsay v. Motorola, Inc., 74 Ill. 2d 172 (1978), which established the cause of action in the context of workers' compensation retaliation. The Illinois Supreme Court and appellate courts have since extended the tort to cover terminations in retaliation for reporting safety concerns and filing OSHA complaints, recognizing that workplace safety is a matter of clearly mandated public policy. See, e.g., Wheeler v. Granite Harbor Group Tractor Co., 108 Ill. 2d 502 (1985); Palmateer v. International Harvester Co., 85 Ill. 2d 124 (1981).
To prevail on a claim of retaliatory discharge under Illinois common law, a plaintiff must establish the following elements:
(1) Plaintiff was an employee of Defendant;
(2) Plaintiff engaged in activity protected by a clearly mandated public policy;
(3) Plaintiff was discharged; and
(4) The discharge was causally connected to the protected activity.
The burden-shifting framework is analogous to the Beaumont Enterprises framework applied in federal employment discrimination cases. Once the plaintiff establishes a prima facie case, the burden shifts to the employer to articulate a legitimate, non-retaliatory reason for the termination. If the employer does so, the burden shifts back to the plaintiff to demonstrate that the stated reason was pretextual — that is, that it was not the true reason for the discharge and that the real reason was retaliatory.
2. Plaintiff's Theory
Maciejewski's theory under Count I is straightforward: he engaged in protected activity by reporting safety concerns internally (to Bosch on April 5, 2021, and to Gallagher on April 19, 2021) and externally (by filing OSHA Complaint No. 1734892 on June 8, 2021); he was terminated approximately 3.5 months later on September 24, 2021; and the temporal proximity, combined with the subject matter of the protected activity, creates a reasonable inference that the termination was causally connected to his safety reporting.
3. Statute of Limitations
The statute of limitations for a retaliatory discharge claim under Illinois common law is five years. See 735 ILCS 5/13-205. The Complaint was filed on March 15, 2022, approximately 5.7 months after the September 24, 2021 termination. The claim is clearly timely.
4. Defense Assessment
Count I is Plaintiff's strongest claim and the one most likely to survive dispositive motion practice. The elements of the prima facie case are likely met: Maciejewski was an employee; he engaged in protected activity (filing an OSHA complaint is clearly protected); he was discharged; and there is some degree of temporal proximity between the protected activity and the discharge.
However, Nexford has a strong affirmative defense. The company can articulate a well-documented, legitimate, non-retaliatory business reason for the termination — namely, Maciejewski's documented, progressive violations of the company's attendance and tardiness policy under Employee Handbook § 4.3. The predating nature of the first written warning (issued before the OSHA complaint) significantly undermines any inference that the disciplinary process was initiated in retaliation for the OSHA complaint. Additionally, OSHA's independent finding of no violation further weakens the inference of retaliatory motive.
Plaintiff will bear the burden of demonstrating pretext — that is, that the attendance-based justification was not the true reason for the termination and was merely a cover for retaliation. Given the documentation in the record, including signed disciplinary notices and the unexcused absence on September 20, 2021, this will be a difficult burden for Plaintiff to meet.
Risk Assessment: Moderate. This claim will likely survive a motion to dismiss but is defensible on summary judgment and, if necessary, at trial.
B. Count II — Retaliation Under 29 U.S.C. § 660(c)
1. Legal Standard
Section 11(c) of the Occupational Safety and Health Act, codified at 29 U.S.C. § 660(c), prohibits employers from discharging or otherwise discriminating against employees who exercise rights under the Act, including the right to file complaints with OSHA regarding unsafe working conditions. The statute provides that an employee who believes he has been retaliated against may file a complaint with the Secretary of Labor within 30 days of the alleged retaliatory action.
2. Critical Procedural Issue — No Private Right of Action
The controlling legal issue with respect to Count II is that there is no private right of action under Section 11(c) of the OSH Act. The exclusive enforcement mechanism under the statute is a complaint filed with the Secretary of Labor, who has sole discretion to investigate and, if warranted, to bring an action in federal district court on behalf of the complainant. See Taylor v. Brighton Corp., 616 F.2d 256 (6th Cir. 1980); George v. Aztec Rental Center, Inc., 763 F.2d 184 (5th Cir. 1985). Illinois courts have consistently recognized this limitation. A private plaintiff cannot bring a direct court action under Section 11(c) without having first filed a timely complaint with the Secretary of Labor and having that complaint acted upon by the Secretary.
3. Analysis. The Complaint does not allege that Maciejewski filed a timely Section 11(c) complaint with the Secretary of Labor within 30 days of his September 24, 2021 termination (i.e., on or before approximately October 24, 2021). Nor does the Complaint allege that OSHA's Whistleblower Protection Program investigated or adjudicated any such complaint, or that the Secretary of Labor authorized or declined to pursue an enforcement action on Maciejewski's behalf.
If Maciejewski failed to file a Section 11(c) complaint within the 30-day window, or if OSHA declined to pursue the claim, no private court action lies under this statute. The claim is procedurally barred.
4. Defense Recommendation
We recommend that Nexford raise the failure to exhaust administrative remedies as an affirmative defense in the Answer and seek early dismissal of Count II. This may be accomplished through a motion to dismiss under 735 ILCS 5/2-619(a)(9), arguing that Plaintiff's claim is barred by the absence of a private right of action and/or the failure to exhaust the administrative remedy prescribed by the statute. Alternatively, the defense may be raised in a motion for judgment on the pleadings after the close of pleadings.
Risk Assessment: Low. Count II has a high likelihood of being dismissed. This claim appears to reflect a drafting error or a misunderstanding of the statutory scheme by Plaintiff's counsel.
C. Count III — Illinois Whistleblower Act (740 ILCS 174/1 *et seq.*)
1. Legal Standard
The Illinois Whistleblower Act, 740 ILCS 174/1 et seq., prohibits employers from retaliating against employees who disclose information in a court, administrative hearing, or before a legislative body, or who disclose information to a government or law enforcement agency, where such disclosure concerns what the employee reasonably believes to be a violation of a state or federal law, rule, or regulation. The Act provides a statutory cause of action for employees who are subjected to adverse employment actions in retaliation for such disclosures.
To prevail under the Illinois Whistleblower Act, a plaintiff must establish:
(1) The employee disclosed information to a government or law enforcement body (or in a court or administrative proceeding);
(2) The disclosure concerned what the employee reasonably believed to be a violation of a state or federal law, rule, or regulation; and
(3) The employer retaliated against the employee as a result of the disclosure.
2. Statute of Limitations
The Illinois Whistleblower Act does not contain its own express statute of limitations. Illinois courts have addressed this gap by applying the one-year catchall statute of limitations under 735 ILCS 5/13-202, which governs actions for which no other limitations period is specified. See Brame v. City of North Chicago, 2011 IL App (2d) 100760.
Under a one-year limitations period, the Complaint — filed on March 15, 2022, approximately 5.7 months after the September 24, 2021 termination — appears to be timely filed. There is no statute-of-limitations defense available with respect to Count III.
3. Analysis. Plaintiff's Count III claim is based on Maciejewski's filing of OSHA Complaint No. 1734892 on June 8, 2021 — a disclosure to a government agency (OSHA) of what Maciejewski believed to be a violation of federal occupational safety and health regulations. The elements of the claim, at the pleading stage, appear to be adequately alleged.
However, Nexford has two significant lines of defense. First, Nexford can argue that the OSHA complaint did not disclose an actual "violation" of law — OSHA investigated the complaint and found no violation, and Nexford's own EHS Department had previously reached the same conclusion. While the statute requires only that the employee "reasonably believe" a violation existed, Nexford can challenge the reasonableness of Maciejewski's belief by pointing to the EHS Department's May 3, 2021 response, which informed Maciejewski that the chemical storage was compliant. A reasonable employee who has been informed by his employer's EHS professionals that no violation exists may have a diminished basis for a continued "reasonable belief" that a violation exists when filing a complaint with OSHA over a month later.
Second, and more importantly, Nexford can advance its legitimate, non-retaliatory business reason defense — the same attendance-based justification applicable to Count I. The progressive discipline record, the predating first written warning, and the documented intervening violations all serve to rebut the inference of retaliation.
Risk Assessment: Moderate. This claim is viable but defensible. It will likely be addressed in tandem with Count I at the summary judgment stage.
VI. DAMAGES EXPOSURE ANALYSIS
A. Damages Claimed in the Complaint
The Complaint seeks the following relief:
• Back pay from the date of termination (September 24, 2021) through the date of judgment;
• Front pay in an unspecified amount;
• Compensatory damages for emotional distress in the amount of $150,000;
• Punitive damages in the amount of $500,000;
• Attorneys' fees and costs of litigation.
The damages demand, totaling potentially in excess of $700,000 exclusive of fees, is aggressive relative to the nature of the case and the legal framework. As discussed below, several components of the demand are unlikely to be fully recoverable.
B. Back Pay Calculation
Maciejewski's final annual salary was $78,400, equating to a monthly salary of approximately $6,533.33. At the time the Complaint was filed on March 15, 2022, back pay had accrued for approximately 5.7 months (from September 24, 2021 through mid-March 2022), yielding an approximate back pay figure of:
$6,533.33 × 5.7 months ≈ $37,240
For purposes of the worst-case exposure analysis, however, we assume that the case may proceed to trial and that judgment may not be entered until approximately one year after termination. Accordingly, we have estimated approximately one year of back pay — $78,400 — as the worst-case back pay exposure, which accounts for potential mitigation failures by Plaintiff and ordinary litigation delays. This estimate is subject to reduction based on Plaintiff's duty to mitigate damages and any earnings he may have obtained or could reasonably have obtained during the back pay period.
C. Internal Worst-Case Exposure Estimate
The following worst-case exposure estimate has been prepared as of April 2022. This estimate reflects the maximum realistic exposure if the case were to proceed to trial and Nexford were to receive an adverse verdict. It does not represent a prediction of the outcome.
Several notes accompany this estimate:
Punitive Damages. Punitive damages are generally not available in Illinois common law retaliatory discharge claims. The Illinois Supreme Court has not recognized a right to punitive damages in retaliatory discharge actions, and the weight of appellate authority holds that such damages are not recoverable. See Kelsay v. Motorola, Inc., 74 Ill. 2d 172, 192 (1978) (awarding punitive damages in a workers' compensation retaliation context, but subsequent decisions have limited the scope of punitive damages availability). The $500,000 punitive damages demand in the Complaint is, in our view, largely unrecoverable under Count I. To the extent any statutory claim (Count III) may permit enhanced damages, the risk is modest given the strength of Nexford's legitimate business justification. We have included a nominal allocation of $77,400 to account for residual punitive damages risk, primarily in recognition of the unpredictability of jury behavior, but we assess this risk as low.
Emotional Distress. The $150,000 demand for emotional distress damages is aggressive for a single-plaintiff employment retaliation case without allegations of particularly egregious conduct. We estimate that a jury award for emotional distress, if liability were established, would more likely be in the range of $25,000 to $75,000. Our worst-case estimate uses a midpoint of $50,000.
Mitigation. Plaintiff bears the burden of proving that he exercised reasonable diligence in seeking substantially equivalent employment after his termination. Discovery should aggressively explore Maciejewski's post-termination employment efforts, applications, interviews, and any income earned since September 24, 2021. Evidence of a failure to mitigate could substantially reduce or eliminate the back pay and front pay components.
D. EPLI Coverage Implications
As noted above, Nexford maintains EPLI coverage through Verdant Mutual Insurance Company under Policy No. EPLI-VM-2021-04782, with a per-occurrence limit of $2,000,000 and a self-insured retention ("SIR") of $50,000.
The worst-case exposure of $285,000 is well within the $2,000,000 per-occurrence limit. Defense costs — including attorneys' fees and litigation expenses — will initially erode the SIR and, once the $50,000 SIR is exhausted, will be covered by the policy (subject to Verdant Mutual's reservation of rights). Given the estimated litigation budget of $175,000 (discussed in Section X below), total defense costs are expected to exhaust the SIR early in the case, after which Verdant Mutual will bear the cost of defense directly.
The combination of the policy limits and the modest exposure in this matter ensures that this case does not present a coverage adequacy concern.
E. Litigation Budget
The pre-trial litigation budget cap for this matter is $175,000, as established in the engagement letter between Calderwood & Harkness and Verdant Mutual (with Nexford's concurrence). Given the nature of the case as a single-plaintiff retaliation claim, the strength of the available defenses, and the modest worst-case exposure, the $175,000 budget should be more than adequate to carry this matter through fact discovery, depositions, and dispositive motions. If the case were to proceed to trial — which we assess as unlikely — supplemental budget authorization would be required.
VII. DEFENSE STRATEGY RECOMMENDATIONS
A. Primary Defense — Legitimate Non-Retaliatory Business Reason
Nexford's strongest and most important defense is that Maciejewski was terminated for documented, progressive violations of the company's attendance and tardiness policy under Employee Handbook § 4.3 — a legitimate, non-retaliatory business reason. This defense, if credited, is dispositive of all three counts.
The key evidence supporting this defense includes the following:
(i) First written warning (May 24, 2021): Issued two full weeks before Maciejewski filed his OSHA complaint on June 8, 2021. The predating nature of this disciplinary action demonstrates that Nexford's attendance-related concerns arose independently of, and prior to, Maciejewski's protected activity.
(ii) Final written warning (August 2, 2021): Issued after three additional documented tardiness incidents between June 1 and July 31, 2021. The final written warning expressly advised Maciejewski that further violations would result in termination.
(iii) Unexcused absence (September 20, 2021): Maciejewski failed to report for his scheduled shift and did not call in. This was the triggering event for the termination, occurring after the final written warning.
(iv) Termination meeting (September 24, 2021): Conducted by Frank Bosch and Cat Donnelly in accordance with Nexford's standard progressive discipline protocol.
To strengthen this defense, we recommend compiling a thorough record of Nexford's consistent enforcement of its attendance policy against other employees during the relevant time period and historically. If Nexford can demonstrate that other employees who accumulated comparable attendance violations were subjected to similar progressive discipline — including termination — the pretext argument becomes exceedingly difficult for Plaintiff to sustain. We will work with Cat Donnelly and the HR Department to identify comparator employees and pull relevant disciplinary records.
B. Failure to Exhaust Administrative Remedies (Count II)
As discussed in Section V.B above, Section 11(c) of the OSH Act, 29 U.S.C. § 660(c), does not provide a private right of action. The exclusive enforcement mechanism is a complaint filed with the Secretary of Labor within 30 days of the alleged retaliatory action. The Complaint does not allege that Maciejewski filed such a complaint or that the Secretary of Labor acted upon it.
We recommend the following approach to Count II:
(i) Raise the failure to exhaust administrative remedies as an affirmative defense in the Answer (to be filed by April 18, 2022).
(ii) Seek early dismissal of Count II, either through a motion to dismiss under 735 ILCS 5/2-619(a)(9) or a motion for judgment on the pleadings following the close of pleadings.
(iii) Conduct targeted discovery to determine whether Maciejewski filed any Section 11(c) complaint with OSHA's Whistleblower Protection Program and, if so, the disposition of that complaint. If no complaint was filed, or if OSHA declined to pursue the claim, the basis for dismissal is clear.
The early elimination of Count II would narrow the case to the two remaining claims (Counts I and III) and simplify the litigation going forward.
C. After-Acquired Evidence Doctrine
Under the after-acquired evidence doctrine, if during the course of discovery Nexford discovers evidence of additional misconduct by Maciejewski that was unknown to the company at the time of his termination, and that misconduct is of a nature that would have independently justified termination, the doctrine may limit or entirely bar Plaintiff's recovery. See McKennon v. Nashville Banner Publ'g Co., 513 U.S. 352 (1995).
We recommend that the defense team conduct a thorough review of Maciejewski's personnel file, departmental records, email correspondence, and any other relevant sources to determine whether there exist grounds for invoking this doctrine. Particular attention should be paid to any issues with Maciejewski's work performance, compliance with company policies, or conduct that may not have been fully documented during his employment.
While we do not presently have information suggesting the existence of after-acquired evidence, the doctrine should be preserved as an affirmative defense in the Answer to ensure it is not waived.
D. Challenge to OSHA Retaliation Nexus
A key defense theme throughout this litigation should be the absence of any substantiated safety violation. OSHA investigated Maciejewski's complaint (Complaint No. 1734892) and closed it on August 18, 2021 with no citations and no findings of violation. Nexford's internal EHS Department had previously reached the same conclusion on May 3, 2021.
The defense argument is twofold:
First, the absence of any actual safety violation undermines the inference that Nexford harbored a retaliatory motive. An employer that knows a safety complaint is meritless has little reason to retaliate against the complainant. By the time Maciejewski was terminated, Nexford knew that OSHA had confirmed the facility's compliance.
Second, the parallel findings of the EHS Department and OSHA demonstrate that Nexford's response to Maciejewski's internal reports was in good faith. The company took the reports seriously, investigated them through its EHS professionals, and determined that no violation existed. This is not the conduct of an employer seeking to suppress safety complaints.
While we acknowledge that the law protects employees who raise safety concerns in good faith even when those concerns prove unfounded, the OSHA finding nonetheless informs the broader credibility and pretext analysis.
E. Temporal Proximity / Pretext Rebuttal
We anticipate that Plaintiff will rely heavily on temporal proximity — the approximately 3.5-month gap between the OSHA complaint (June 8, 2021) and the termination (September 24, 2021) — as circumstantial evidence of retaliatory motive. While temporal proximity alone is generally insufficient to establish a retaliatory discharge claim, it is a factor that courts and juries consider.
Our counterarguments to the temporal proximity theory are as follows:
(i) The disciplinary process began before the OSHA complaint. The first written warning was issued on May 24, 2021 — two weeks before the OSHA complaint was filed on June 8, 2021. The attendance issues that led to Maciejewski's termination were identified and documented prior to the protected activity.
(ii) The intervening attendance violations are independently documented. Between the OSHA complaint (June 8, 2021) and the termination (September 24, 2021), Maciejewski committed three additional tardiness violations (reflected in the August 2, 2021 final written warning) and an unexcused absence on September 20, 2021. These are independent, documented events that explain the escalation of discipline.
(iii) The OSHA complaint was closed with no findings before the termination. As of August 18, 2021, OSHA had closed the complaint with no citations. The complaint was a non-issue by the time the termination occurred, further undermining the temporal proximity argument.
(iv) The decision-makers followed standard protocol. Frank Bosch and Cat Donnelly conducted the termination meeting in accordance with Nexford's established progressive discipline procedures. There is no evidence that the process was irregular or that the decision-makers deviated from their normal practices.
The combined force of these arguments substantially rebuts the temporal proximity theory. Temporal proximity without more — particularly when there is a documented, legitimate, predating basis for the adverse action — is insufficient to establish pretext under Illinois law.
F. Discovery Plan
We recommend that Nexford pursue the following discovery priorities:
(i) OSHA communications. Obtain all communications between Maciejewski and OSHA, including the original complaint (Complaint No. 1734892), any follow-up correspondence, the CSHO's inspection report, and any communications related to a potential Section 11(c) whistleblower complaint. These documents are critical both for the defense of Count II and for the broader factual record.
(ii) Post-termination employment history. Obtain detailed information regarding Maciejewski's post-termination employment efforts, applications, interviews, job offers, and earnings since September 24, 2021. This information is essential for assessing the mitigation defense and reducing any back pay or front pay award.
(iii) Third-party communications. Obtain any communications between Maciejewski and third parties (co-workers, union representatives, attorneys, government agencies) regarding his internal safety reports, the OSHA complaint, and/or his termination. These communications may reveal the timing of Maciejewski's decision to file suit and his motivations.
(iv) Medical records. If Plaintiff pursues the emotional distress claim, Nexford will be entitled to discovery of Maciejewski's relevant medical and mental health records. Depending on Plaintiff's willingness to stipulate to the production of these records, we may need to seek a court order or file an appropriate motion.
(v) Interrogatories. Serve interrogatories targeting the factual basis for each count of the Complaint, the identity of all witnesses, the calculation of claimed damages, and the specific acts or statements that Plaintiff contends constitute evidence of retaliatory motive.
With respect to Nexford's own document production, the company has already identified 847 pages of documents for production, bearing Bates numbers NIH-000001 through NIH-000847. These documents include Maciejewski's complete personnel file, attendance records, progressive discipline documentation (including the signed first written warning, final written warning, and separation memorandum), the EHS report on Building C, the Employee Handbook (including § 4.3), and relevant correspondence. We will review these documents for privilege and responsiveness and prepare them for production in response to Plaintiff's anticipated discovery requests.
G. Dispositive Motion Strategy
Our recommended dispositive motion strategy is as follows: