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BMD Obtains Supreme Court Victory on Behalf of Sterilite of Ohio, LLC

Client Alert

Columbus, Ohio – On August 26, 2020, the Supreme Court of Ohio issued its opinion in Lunsford v. Sterilite of Ohio, LLC, Slip Op. No. 2020-Ohio-4193. The Supreme Court’s 4-3 decision reversed an Ohio Court of Appeals ruling that had reinstated a putative class action against Sterilite brought by a group of current and former employees claiming that Sterilite’s use of “direct observation” urinalysis screening violated their common law right to privacy.

BMD originally obtained dismissal of the case in the Stark County Court of Common Pleas, which was reversed by a decision of the Ohio Fifth District Court of Appeals in August 2018. Following the Fifth District’s adverse ruling, BMD successfully petitioned the Supreme Court of Ohio to accept jurisdiction and hear the case. BMD partner Daniel Rudary argued Sterilite’s appeal to the Supreme Court on January 28, 2020.

In its decision reversing the appellate court, the Supreme Court majority adopted BMD’s argument that the plaintiff employees consented to drug testing under the “direct observation” method when they voluntarily produced urine samples while being observed by a same-sex monitor in a designated restroom facility. The Supreme Court also reaffirmed Ohio’s long standing rule of employment-at-will, holding that because “Sterilite had the legal right to terminate appellees’ employment at any time, appellees’ argument that their consent was involuntary because of their fear of termination necessarily fails.”

BMD Litigation Member John Childs and Partner Daniel Rudary represented Sterilite before the Supreme Court of Ohio. Their brief to the Supreme Court can be read here, and Attorney Rudary’s January 28, 2020 oral argument can be viewed here.

See additional coverage on the decision in the ABA Journal and Bloomberg News.


Substance Use Disorder Providers: 42 CFR Part 2 Now Enforceable

Updates to 42 CFR Part 2 are now enforceable, bringing significant changes to how substance use disorder (SUD) records are handled. The Final Rule aligns Part 2 more closely with HIPAA, introduces updated penalties, allows a single patient consent for treatment, payment, and operations, and adds new requirements for Notices of Privacy Practices. It also creates a formal definition of SUD counseling notes and imposes strict consent requirements for their use and disclosure. Providers should review and update policies to ensure compliance.

AAA Introduces AI-Assisted Arbitrator for Certain Disputes

The American Arbitration Association has introduced an AI-assisted arbitration platform designed to streamline certain document-based disputes. While a human arbitrator still makes the final decision, the technology can improve efficiency, reduce costs, and accelerate case resolution. Companies should weigh these benefits against considerations such as transparency, risk, and contractual requirements before adopting AI-assisted arbitration.

Quiet Hours Texts and TCPA Claims: Consent Remains King as Courts Divide on Text Messages

Businesses face increasing TCPA lawsuits over off-hours marketing texts, but recent court decisions highlight strong defenses. Clear consumer consent and updated terms and conditions can defeat many claims, while a growing number of courts are finding that text messages are not “telephone calls” under the statute. Proactive compliance measures, including clickwrap agreements and forum-selection clauses, are critical to reducing risk.

New Ohio Reporting Requirements for Non-Residential Contractors

Ohio’s E-Verify Workforce Integrity Act, effective March 19, 2026, requires all nonresidential construction companies, subcontractors, and labor brokers to use E-Verify to confirm employee work eligibility on projects across the state. The law applies regardless of company size and carries financial penalties and potential restrictions on future state contracts for noncompliance. Some uncertainty remains around requirements for existing employees, making early compliance planning important.

DOT Non-Domiciled CDL Rule

A new rule from the Federal Motor Carrier Safety Administration (FMCSA) will significantly narrow eligibility for non-domiciled Commercial Driver’s Licenses (CDLs) beginning March 16, 2026. The rule limits eligibility to holders of H-2A, H-2B, and E-2 visas and eliminates Employment Authorization Documents (EADs) as qualifying proof of work authorization. As a result, many lawfully present and work-authorized immigrants, including refugees, asylees, DACA recipients, and Temporary Protected Status holders, will no longer be able to obtain or renew a non-domiciled CDL. The change is expected to affect roughly 194,000 drivers nationwide and has prompted multiple legal challenges, including a pending emergency stay request before the United States Court of Appeals for the District of Columbia Circuit.