## Facts

- Financial Fusion, Inc. (FFI), a software company acquired by Sybase, Inc., experienced continuing operating losses and conducted multiple layoffs in 2001.
- FFI terminated nine employees in early 2001.
- FFI terminated four employees on September 7, 2001.
- FFI terminated forty-one employees on September 28, 2001, attributed to efforts to cut operating expenses amid financial problems.
- FFI terminated eleven employees on October 31, 2001: six allegedly tied to a Sybase restructuring and five described as additional cost-cutting.
- FFI conceded it terminated 56 employees within a 90-day period but contended WARN did not apply because the terminations did not constitute a single “mass layoff” under WARN’s aggregation rule.
- Employees sued for damages under the Worker Adjustment and Retraining Notification Act (WARN) for failure to provide 60 days’ notice.
- The district court granted summary judgment for the employees and entered judgment awarding WARN damages, interest, and attorneys’ fees.
- On appeal, defendants argued the September 28 layoffs were driven by the economic effects of September 11, 2001, while the October 31 layoffs resulted from corporate reorganization, making them non-aggregable.

## Issues

1. Whether employment losses within a 90-day period had to be aggregated under WARN to determine if a “mass layoff” occurred, or whether defendants proved the layoffs resulted from “separate and distinct causes.”
2. Whether summary judgment for employees was proper, or whether genuine disputes of material fact existed regarding the causes of the different layoff groups.
3. To the extent raised, whether the asserted post-September 11 economic impact affected WARN analysis of causation or defenses related to notice obligations.

## Decision

- The Tenth Circuit affirmed in part, reversed in part, and remanded.
- The court held WARN’s 90-day aggregation rule applies by default; employers avoid aggregation only by proving “separate and distinct causes” for different groups of employment losses.
- The court concluded the summary-judgment record did not conclusively establish defendants’ “separate and distinct causes” position for all relevant layoffs.
- The court determined the district court resolved certain disputed causation questions on summary judgment that required further proceedings.

## Legal Principles

- WARN is a remedial statute requiring 60 days’ notice before covered plant closings or mass layoffs; liability may include up to 60 days’ back pay and benefits for covered employees when notice is not given.
- WARN aggregates smaller employment losses occurring within a 90-day period to determine whether a “mass layoff” occurred.
- The employer bears the burden to show that separate groups of employment losses within the 90-day window were due to “separate and distinct causes” to avoid aggregation.
- On summary judgment, courts must not resolve genuine disputes over material facts, including contested evidence about the actual drivers of multiple layoff events.

## Conclusion

The Tenth Circuit applied WARN’s 90-day aggregation framework and held that, while employers may avoid aggregation by proving “separate and distinct causes,” the record contained unresolved factual disputes about causation for the September and October layoffs; it therefore affirmed only in part and remanded for further proceedings.


Allen v. Sybase, Inc., 468 F.3d 642 (10th Cir. 2006)