100px-US-CourtOfAppeals-9thCircuit-Seal_svgBy Gerald L. Maatman, Jr., Christopher J. DeGroff and Alex W. Karasik

Seyfarth Synopsis: After the U.S. Supreme Court clarified in McLane Co. v. EEOC, No. 15-1248, 2017 U.S. LEXIS 2327 (U.S. 2017), that the scope of review for employers facing EEOC administrative subpoenas was the abuse-of-discretion standard, a relatively high bar of review, the Ninth Circuit applied that standard of review on remand and vacated the District Court’s original decision that denied the enforcement of an EEOC subpoena.

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An often contentious issue in EEOC investigations involves the scope of administrative subpoenas, which can be burdensome for employers when the subpoenas seek a broad range of company-wide information.  When analyzing the standard of review for decisions relating to the enforcement of EEOC subpoenas, in McLane Co. v. EEOC, No. 15-1248, 2017 U.S. LEXIS 2327 (U.S. Apr. 3, 2017), the U.S. Supreme Court held that such decisions were examined under an abuse-of-discretion standard.  The abuse-of-discretion standard sets a relatively high bar for review, as we blogged about here.  Following the U.S. Supreme Court’s remand to the Ninth Circuit in McLane, the Ninth Circuit vacated the District Court’s denial of enforcement of the subpoena and sent the matter back to the District Court for further proceedings.  EEOC v. McLane Co., No. 13-15126, 2017 U.S. App. LEXIS 9027 (9th Cir. May 24, 2017).

For employers, this is an important case to follow as it provides clarification as to the standard of review used when Appellate Courts address district court subpoena enforcement decisions.

Background

The EEOC issued an administrative subpoena as part of its investigation into a charge of discrimination filed by a former employee of a McLane subsidiary.  Id. at *3.  The employee alleged that McLane discriminated against her on the basis of sex when it fired her after she failed to pass a physical capability strength test.  Relevant here, the subpoena requested “pedigree information” (name, Social Security number, last known address, and telephone number) for employees or prospective employees who took the test.  Following the Court’s precedent at the time, the Ninth Circuit applied a de novo review to the District Court’s ruling that the pedigree information was not relevant to the EEOC’s investigation.  Id. at *3-4.  The U.S. Supreme Court vacated the Ninth Circuit’s judgment after holding that a district court’s decision whether to enforce an EEOC subpoena should be reviewed for abuse of discretion.  The U.S. Supreme Court remanded the case to the Ninth Circuit so that the Ninth Circuit could re-evaluate the District Court’s ruling under the proper standard of review.

 The Ninth Circuit’s Decision On Remand

After reviewing the District Court’s decision under the abuse-of-discretion standard, the Ninth Circuit still held that the District Court abused its discretion by denying enforcement of the subpoena.  Id. at *4.  The District Court found that the pedigree information was not relevant “at this stage” of the EEOC’s investigation because the evidence McLane had already produced would “enable the [EEOC] to determine whether the [strength test] systematically discriminates on the basis of gender.”  Id.  The Ninth Circuit rejected this approach, noting that the District Court’s ruling was based on the wrong standard for relevance.  The Ninth Circuit stated that under Title VII, the EEOC may obtain evidence if it relates to unlawful employment practices and is relevant to the charge under investigation.  Quoting EEOC v. Shell Oil Co., 466 U.S. 54, 68-69 (1984), the Ninth Circuit opined that the relevance standard encompasses “virtually any material that might cast light on the allegations against the employer.”  Id. at *5.

Applying Shell Oil, the Ninth Circuit found that the pedigree information was relevant to the EEOC’s investigation since conversations with other McLane employees and applicants who have taken the strength test “might cast light” on the allegations against McLane.  Id.  McLane argued that, given all of the other information it had produced, the EEOC could not show that the production of nationwide pedigree information was relevant to the Charge or its investigation under either a disparate treatment or disparate impact theory.  Id. at *6. The Ninth Circuit construed the District Court’s application of relevance to be a heightened “necessity” standard, and noted that the governing standard was “relevance,” not “necessity.”  Id.

The Ninth Circuit then found that the District Court erred when it held that pedigree information was irrelevant “at this stage” of the investigation.  Id.  Rejecting the District Court’s conclusion that the EEOC did not need pedigree information to make a preliminary determination as to whether use of the strength test resulted in systemic discrimination, the Ninth Circuit held that the EEOC’s need for the evidence—or lack thereof—did not factor into the relevance determination.  Id. at *6-7. While McLane had argued that the pedigree information was not relevant because the charge alleged only a “neutrally applied” strength test, which by definition cannot give rise to disparate treatment, systemic or otherwise, the Ninth Circuit rejected this approach, holding “[t]he very purpose of the EEOC’s investigation is to determine whether the test is being neutrally applied; the EEOC does not have to take McLane’s word for it on that score.”  Id. at *7.  Accordingly, the Ninth Circuit held that because the District Court based its ruling on an incorrect view of relevance, it necessarily abused its discretion when it held that the pedigree information was not relevant to the EEOC’s investigation.

The Ninth Circuit concluded by noting that on remand, McLane was free to renew its argument that the EEOC’s request for pedigree information was unduly burdensome.  Id. at *8. Further, explaining that it did not reach the issue in its original decision, the Ninth Circuit instructed that “[o]n remand, the district court should also resolve whether producing a second category of evidence — the reasons test takers were terminated — would be unduly burdensome to McLane.”  Id.  Accordingly, the Ninth Circuit vacated the District Court’s judgment and remanded for further proceedings.

Implications For Employers

As employers who are confronted with EEOC subpoenas may ultimately find themselves in a subpoena enforcement action, the McLane case is a must-follow in terms of what standard of review will be applied if those district court decisions are later reviewed.  The U.S. Supreme Court’s adoption of the more “hands off” abuse-of-discretion standard means that greater weight will be given to district court decisions.  Nonetheless, the Ninth Circuit’s ruling here illustrates that appellate courts may still be willing to overturn district court decisions to enforce or quash EEOC subpoenas depending on the circumstances.  The decision will also, no doubt, be cited by an emboldened EEOC as authority for its position that expansive pedigree information is relevant in a broad swath of cases.  Understanding these trends will provide useful guidance for employers when deciding if and how to challenge what often can be burdensome demands for information from the EEOC.

Readers can also find this post on our Workplace Class Action blog here.

supreme court seal

By Gerald L. Maatman, Jr., Christopher J. DeGroff, and Matt Gagnon

Seyfarth Synopsis: Yesterday the U.S. Supreme Court handed down its long-awaited decision in McLane Co. v. EEOC, No. 15-1248, 2017 U.S. LEXIS 2327 (U.S. 2017), a decision that clarifies the scope of review for employers facing EEOC administrative subpoenas. The Supreme Court held that such decisions are reviewable under the abuse-of-discretion standard, which is a relatively high bar of review. At the same time, the Supreme Court’s ruling clarifies that EEOC subpoenas are subject to a searching, fact-intensive review that does not lend itself to a “one size fits all” approach.

Background

This case arose out of a Title VII charge brought by a woman who worked as a “cigarette selector,” a physically demanding job, requiring employees to lift, pack, and move large bins of products. After the charging party returned from three months of maternity leave, she was required to undergo a physical capabilities evaluation that was required for all new employees and employees returning from leave or otherwise away from the physically demanding aspects of their job for more than 30 days, regardless of reason. The charging party was allowed three times to meet the level required for her position, but failed each time.  McLane then terminated her employment.

The charging party claimed that her termination was because of her gender, and further alleged disability discrimination. During the investigation of her EEOC charge, the Commission requested, among other things, a list of employees who were requested to take the physical evaluation. Although McLane provided a list that included each employee’s gender, role at the company, evaluation score, and the reason each employee had been asked to take the evaluation, the company refused to provide “pedigree information,” relative to names, social security numbers, last known addresses, and telephone numbers of employees on that list. In the process of negotiating the scope of information that would be provided, the EEOC learned that McLane used its physical evaluation on a nationwide basis. The EEOC therefore expanded the scope of its investigation to be nationwide in scope, and also filed its own charge alleging age discrimination.

The District Court refused to order the production of pedigree information, holding that it was not “relevant” to the charge at issue because that information (or even interviews of the employees on the list provided by McLane) could not shed light on whether an evaluation represented a tool of discrimination. EEOC v. McLane Company, Inc., No. 12-CV-02469 (D. Ariz. Nov. 19, 2012) (See our blog post of the District Court’s decision here.)

On October 27, 2015, the U.S. Court of Appeal for the Ninth Circuit reviewed the District Court’s decision de novo and held that the District Court had erred in finding the pedigree information irrelevant to the EEOC’s investigation. EEOC v. McLane Company, Inc., Case No. 13-15126, 2015 U.S. App. LEXIS 187702 (9th Cir. Oct. 27, 2015). (See our blog post of the Ninth Circuit’s decision here.)

The Supreme Court granted certiorari to resolve the disagreement among the courts of appeals regarding the appropriate scope of review on appeal. The posture of the appeal was somewhat unusual because, after the grant of certiorari, the EEOC and McLane both agreed that the District Court’s decision should be reviewed for abuse of discretion, although the EEOC argued that the Ninth Circuit’s decision should stand as a matter of law. The Supreme Court therefore appointed an amicus curiae to defend the Ninth Circuit’s use of de novo review.

The Supreme Court’s Decision

The Supreme Court began its analysis by noting that in the absence of explicit statutory command, the proper scope of appellate review is based on two factors: (1) the history of appellate practice; and (2) whether one judicial actor is better positioned than another to decide the issue in question.

Regarding the first factor, the Supreme Court noted that abuse-of-discretion review was the longstanding practice of the courts of appeals when reviewing a decision to enforce or quash an administrative subpoena. In particular, the Supreme Court noted that Title VII had conferred on the EEOC the same subpoena authority that the National Labor Relations Act had conferred on the National Labor Relations Board (“NLRB”), and decisions of district court to enforce or quash an NLRB subpoena were reviewed for abuse of discretion.

Regarding the second factor, the Supreme Court held that the decision to enforce or quash an EEOC subpoena is case-specific, and one that does not depend on a neat set of legal rules. Rather, a district court addressing such issues must apply broad standards to “multifarious, fleeting, special, narrow facts that utterly resist generalization.” McLane Co. v. EEOC, 2017 U.S. LEXIS 2327, at *14 (U.S. 2017) (quoting Pierce v. Underwood, 487 U. S. 552, 561-62 (1988)). In particular, in order to determine whether evidence is relevant, the district court has to evaluate the relationship between the particular materials sought and the particular matter under investigation. These types of fact-intensive considerations are more appropriately done by the district courts rather than the courts of appeals.

The Amicus argued that the district court’s primary role is to test the legal sufficiency of the subpoena, which does not require the exercise of discretion. The Supreme Court held that this view of the abuse-of-discretion standard was too narrow. The abuse-of-discretion standard is not only applicable where a decision-maker has a broad range of choices as to what to decide, but also extends to situations where it is appropriate to give a district court’s decision an unusual amount of insulation from appellate revision for functional reasons. Those functional considerations weighed in favor of the abuse-of-discretion standard rather than a de novo standard of review. Because the Ninth Circuit did not apply that standard on appeal, the Supreme Court remanded the case to the Ninth Circuit for further proceedings.

Implications For Employers

The McLane case is important for employers because it clarifies the standard of review that is applied to the review of district court decisions enforcing or quashing EEOC subpoenas. Although the Supreme Court adopted the more “hands off” abuse-of-discretion standard, thus giving even more weight to the district court’s judgment, it did so because it identified the fact-intensive nature of these judgment calls, including important decisions about how difficult it would be for the employer to produce the requested information weighed against the need for that information, and the relationship between the particular materials sought and the particular matter under investigation.

At the very least, this language shows that the EEOC does not get to automatically presume relevance of its administrative subpoenas at the outset, as the EEOC sometimes likes to argue. Rather, employers should be able to cite to language in the Supreme Court’s opinion to reinforce the fact that the district court must give serious consideration to issues of relevancy and burden (also whether the subpoena is “too indefinite” or for an “illegitimate purpose”) when deciding whether to enforce an EEOC subpoena.

Readers can also find this post on our Workplace Class Action blog here.

th7Y6M6GN7By Gerald L. Maatman, Jr., Mark Casciari, and Christina M. Janice

Seyfarth Synopsis: For the first time since 1998, the EEOC has updated its enforcement guidance on retaliation claims brought under the various anti-discrimination laws the Commission is charged with enforcing.  Observing that retaliation is now the single largest category of claims presented in its charges, the EEOC’s new enforcement guidance advocates expansive interpretations of law to broaden retaliation protections for federal and private sector applicants and employees, creating new burdens on employers who decide to attempt to comply with this new EEOC directive.

Making good on its stated objective to transform itself from a “nationwide law firm” to a “national law enforcement agency,”[1] the EEOC on August 29, 2016 issued its new Enforcement Guidance on Retaliation and Related Issues along with a Small Business Fact Sheet.  After a period of public comment on its Proposed Enforcement Guidance on Retaliation, see here, the EEOC has now asserted even stronger, more expansive positions than it first proposed on defining actionable retaliation under Title VII of the Civil Rights Act of 1964 (Title VII), the Age Discrimination in Employment Act (ADEA), Title V of the Americans With Disabilities Act (ADA), Section 501 of the Rehabilitation Act (Section 501), the Equal Pay Act (EPA), and Title II of the Genetic Information Nondiscrimination Act (GINA).  While the Guidance itself does not have the force of law, it provides employers with a valuable roadmap of the EEOC’s agenda both in pursuing workplace retaliation claims and in attempting to make law in the courts.

The EEOC now clearly positions itself as interpreting anti-discrimination laws and federal decisions as it sees fit to serve its enforcement objectives: “This document sets for the Commission’s interpretation of the law of retaliation and related issues. . . . Where the lower courts have not consistently applied the law or the EEOC’s interpretation of the law differs in some respect, the guidance sets forth the EEOC’s considered position and explains its analysis.” (Emphasis added.)  Rather than enforce existing law as interpreted by courts throughout the country, the EEOC supports its nationwide objective to expand employee protections by relying on court decisions favoring its approach, while at the same time rejecting court decisions that do not.

What Is Retaliation?

The Guidance says that the preconditions to a retaliation claim include: 1) protected activity being either “participation in an EEO process” or “opposition to discrimination”; 2) materially adverse action taken by the employer; and 3) a requisite level of causal connection between the protected activity and materially adverse action.  The EEOC considers these three elements to be fluid concepts, to be read and enforced expansively.

The Guidance also focuses on the concept of “anticipatory retaliation” or “pre-emptive retaliation” articulated by the Seventh and Tenth Circuits, that retaliation occurs “…when an employer takes a materially adverse action because an individual has engaged in, or may engage in, activity in furtherance of the EEO laws the Commission enforces” (emphasis added, citing Beckel v. Wal-Mart Assocs., Inc., 301 F.3d 621, 624 (7th Cir. 2002); Sauers v. Salt Lake Cty., 1 F.3d 1122, 1128 (10th Cir. 1993)). Employers concerned about the EEOC’s scrutiny now must be vigilant to document or otherwise be able to prove that all aspects of performance management – including, but not limited to, evaluations, warnings, reprimands, hiring, promotions, compensation, terminations and references – is conducted without regard to whether an applicant or employee may be about to participate in an EEO process or oppose discrimination.

What Is Protected Activity?

Participation In An EEO Process.  The Guidance restates the EEOC’s longstanding position that participation in an EEO process is protected whether or not an individual has a reasonable, good faith belief that the allegations are or could become unlawful. Conceding that the Supreme Court has not addressed this question, the EEOC nonetheless rejects decisions by the Seventh and Eighth Circuits that hold that the anti-retaliation protections of Title VII do not extend to individuals making false claims to the EEOC. (See Gilooly v. Mo. Dep’t of Health & Senior Servs., 421 F.3d 734, 240 (8th Cir. 2005); Mattson v. Caterpillar, Inc., 359 F.3d 885, 891 (7th Cir. 2004)).

Opposition To Discrimination.  The Guidance provides that “opposition to discrimination” must be “reasonable” in manner to receive protection. The Guidance then qualifies this position by observing that that there is overlap between what constitutes “participation in an EEO process” and “opposition to discrimination.”  Relying on Sixth Circuit case law the Guidance provides, self-servingly, that the EEOC is afforded great discretion to determine what constitutes protected activity. Employers should be on the lookout that the reasonableness of behaviors alleged to be in opposition to discrimination may be eroded as a defense to retaliation claims.

The Guidance also states that the EEOC rejects and will challenge what some courts have dubbed the “manager rule”; namely, that managers must step outside their management roles and take a position adverse to the employer in order to engage in the protected activity of opposition to discrimination.

What Is A Materially Adverse Action?

With respect to the requirement that an individual suffer a materially adverse action at the hands of an employer, the EEOC continues to broaden the actions that in its view constitute “materially adverse actions” as to include one-off incidents, warnings, dissuasive activities that do not directly affect employment, and activities outside of the workplace that may dissuade an applicant, employee or former employee from engaging in protected activity.  Further, actions purportedly taken against close family members and fiancés on account of an applicant, employee or former employee engaging in protected activity also will be challenged as retaliatory.

What Is Causation?

While the Guidance acknowledges that the Supreme Court has held that the standard for proof of retaliation under Title VII is that “but for” the a retaliatory motive, the employer would not have taken the adverse action, the Guidance introduces the “motivating factor” standard for federal sector Title VII and ADEA retaliation cases, prohibiting retaliation if it is a mere motivating factor behind an adverse action.  The Guidance provides that suspicious timing, incriminating oral or written statements, evidence of how comparable individuals were treated differently, and inconsistent or shifting explanations of the adverse action all can support a finding of retaliation, while the employer’s ignorance of the protected activity or having a legitimate, non-discriminatory reason for the adverse action may support a finding that no unlawful retaliation has occurred.

Related Issues – Requests For Accommodation

The Guidance discusses that, in addition to retaliation, the Americans With Disabilities Act prohibits interference with an applicant, employee or former employee’s rights under the ADA, including assisting another in the exercise of their rights under the ADA.  The Guidance suggests that the EEOC will aggressively challenge conduct allegedly interfering with requests for accommodation for disability under the ADA, as well as requests for religious accommodation under Title VII.

Implications For Employers

While the Guidance states that “[e]mployers remain free to discipline or terminate employees for legitimate, non-discriminatory, non-retaliatory reasons, notwithstanding any prior protected activity,” employers have no cause for reassurance from the EEOC.  The Guidance signals that the EEOC is broadening its interpretation of retaliation to include protection for activity that has not yet occurred, possible protection for “opposition” activities that may not be reasonable, and protection to the applicant and  employee who may engage in protective activity in the future.

[1] We previously blogged about the EEOC’s change in focus here.

Readers can also find this post on our Workplace Class Action blog here.

United_States_District_Court_for_the_Eastern_District_of_Michigan_sealBy Gerald L. Maatman, Jr. and Alex W. Karasik

Seyfarth Synopsis: In one of the first two ever transgender discrimination cases brought by the EEOC, a federal court in Michigan granted the employer’s motion for summary judgment, finding the employer met its burden in demonstrating that it is exempt under the Religious Freedom Restoration Act, while the EEOC failed to suggest a less restrictive alternative in its challenge of the employer’s gender-specific dress code policy.

In one of the first two ever transgender discrimination cases brought by the EEOC, the government alleged that a funeral home wrongfully terminated its former funeral director for being transgender, for transitioning from male to female, and/or for not conforming to the employer’s gender-based preferences regarding its dress code.  The funeral home argued it was exempt under the Religious Freedom Restoration Act (“RFRA”).  In EEOC v. R.G. & G.R. Harris Funeral Homes, Inc., No. 14-13710 (E.D. Mich. Aug. 18, 2016), after the EEOC and employer R.G. & G.R. Harris Funeral Homes, Inc. (“the Funeral Home”) both moved for summary judgment, Judge Cox of the U.S. District Court for the Eastern District of Michigan granted the Funeral Home’s motion and denied the EEOC’s motion.  The court also dismissed the EEOC’s claim that the Funeral Home engaged in an unlawful employment practice by providing work clothes only to males, noting that the EEOC had not done a full investigation of this claim that it uncovered during its wrongful termination investigation.

Although transgender discrimination litigation is not yet explicitly covered under Title VII, this ruling is monumental in terms of shaping the landscape for an evolving area of law that will profoundly impact employers in years to come.

Case Background

The Funeral Home is a closely-held, for-profit corporation operating three funeral homes in Michigan.  Id. at 7.  Owner and operator Thomas Rost has been a Christian for over sixty-five years.  Id. at 15.  While the Funeral Home does not officially affiliate with a religion, its website contains scripture and various bible verses are dispersed at its locations.  Id.  The Funeral Home has a strict employee dress code policy with several requirements, including that men must wear suits and women must wear jackets and skirts/dresses.  Id. at 8-9.

The claimant was hired in 2007.  Id. at 9.  In 2013, the claimant provided the Funeral Home with a letter stating he intended to begin transitioning his gender to female following return from a vacation.  Id. at 10.  Although the claimant intended to abide by the gender-specific dress code by wearing a skirt during the transition, Rost fired the claimant, stating “this is not going to work out.”  Id. at 11.

The claimant filed a charge of sex discrimination with the EEOC.  During its investigation, the EEOC discovered that male employees at the Funeral Home were provided with work clothing and that female employees were not.  The EEOC filed suit against the Funeral Home on September 25, 2014, asserting two claims.  Id. at 12.  First, it asserted a wrongful termination claim, alleging the claimant was fired because the claimant is transgender, because of the claimant’s transition from male to female, and/or because the claimant did not conform to the Funeral Home’s sex or gender-based preferences, expectations, or stereotypes.  Second, the EEOC alleged that the Funeral Home engaged in an unlawful employment practice by providing work clothes to male but not female employees.  The parties filed cross-motions for summary judgment.

The Decision

The court granted summary judgment in favor of the Funeral Home as to the wrongful termination claim, and dismissed the EEOC’s claim regarding the work clothes being provided only to males.  Id. at 55-56.  First, the Funeral Home asserted that its enforcement of its sex-specific dress code cannot constitute impermissible sex stereotyping under Title VII.  The court rejected this argument, opining that “[t]his evolving area of the law – how to reconcile this previous line of authority regarding sex-specific dress/grooming codes with the more recent sex/gender-stereotyping theory of sex discrimination under Title VII – has not been addressed by the Sixth Circuit.”  Id. at 25-26.

On the heels of the Supreme Court’s decision in Burwell v. Hobby Lobby Stores, Inc., 134 S. Ct. 2751 (2014), the Funeral Home also argued that the RFRA prohibited the EEOC from applying Title VII to force the Funeral Home to violate its sincerely held religious beliefs.  Id. at 26.  The RFRA prohibits the “‘Government [from] substantially burden[ing] a person’s exercise of religion even if the burden results from a rule of general applicability’ unless the Government ‘demonstrates that application of the burden to the person—(1) is in furtherance of a compelling governmental interest; and (2) is the least restrictive means of furthering that compelling governmental interest.’”  Id. at 27 (quoting 42 U.S.C. §§ 2000bb–1(a), (b)).  The EEOC conceded that the Funeral Home’s religious beliefs were sincerely held.  Id.  Accordingly, citing Rost’s testimony that permitting employees to dress inconsistent with their biological sex would violate his religion and pressure him to relinquish his business, the court found that “the Funeral Home met its initial burden of showing that enforcement of Title VII, and the body of sex-stereotyping case law that has developed under it, would impose a substantial burden on the ability of the Funeral Home to conduct business in accordance with its sincerely-held religious beliefs.”  Id. at 32.

After finding that the Funeral Home demonstrated that enforcement of Title VII would be a substantial burden to its religious exercise, the EEOC then needed to meet its two-part test: (1) application of the burden is in furtherance of a compelling government interest; and (2) is the least restrictive means of furthering that compelling government interest.  The court assumed without deciding that the EEOC met its first burden, therefore proceeded to analyze the least restrictive means burden.  Id. at 36.  Quoting Hobby Lobby, the court noted that the “least-restrictive means standard is exceptionally demanding.”  134 S. Ct. at 2780.

Rejecting the EEOC’s conclusory argument that Title VII is narrowly tailored, the court noted that the EEOC did not provide “a focused ‘to the person’ analysis of how the burden on the Funeral Home’s religious exercise is the least restrictive means of clothing gender stereotypes at the Funeral Home under the facts and circumstances presented here.”  Id. at 38.  Further, noting the EEOC had been proceeding as if gender identity or transgender status was protected under Title VII, the court opined that the EEOC appeared to have taken the position that the only acceptable solution would be for the Funeral Home to allow the claimant to wear a skirt while working as a funeral director.  Id. at 39.

Finding that the EEOC failed to offer or even explore any solutions that could have worked under the facts of this case, the court rejected the EEOC’s approach and questioned “[i]f the EEOC truly has a compelling governmental interest in ensuring that [the claimant] is not subject to gender stereotypes in the workplace in terms of required clothing at the Funeral Home, couldn’t the EEOC propose a gender-neutral dress code (dark-colored suit, consisting of a matching business jacket and pants, but without a neck tie) as a reasonable accommodation that would be a less restrictive means of furthering that goal under the facts presented here?”  Id. at 38-41.  Accordingly, the court held that the EEOC did not meet its demanding burden, thus entitling the Funeral Home to RFRA exemption from Title VII.

As to the second claim, the EEOC alleged that the Funeral Home violated Title VII by providing a clothing allowance and/or work clothes to male employees but failing to provide such assistance to female employees.  Id. at 45.  Relying on EEOC v. Bailey, 563 F.2d 439 (6th Cir. 1977), the Funeral Home argued that the EEOC may include in a Title VII suit only claims that fall within an “investigation reasonably expected to grow out of the charge of discrimination.”  Id. at 45-46.  Applying Bailey, the court concluded that the EEOC investigation here uncovered possible unlawful discrimination (1) of a kind not raised by the claimant; and (2) not affecting the claimant.  Id. at 54-55.  Thus, the court instructed that the proper procedure would be the filing of a charge by a member of the EEOC and for a full EEOC investigation of that new claim of discrimination.  Accordingly, the court dismissed the EEOC’s clothing allowance claim without prejudice.  Id. at 56.

Implications For Employers

With an increasingly diverse workforce employing more transgender employees, employers would be wise to adopt an inclusive mentality in order allow their business to nurture a broader range of perspectives while also protecting against potential discrimination liability.  As this was a favorable ruling for the employer, businesses with sincerely held religious beliefs can use this as a template to seek protection under RFRA exemptions when defending against various discrimination claims, including those brought on behalf of transgender employees.  Until Title VII eventually incorporates transgender discrimination, the EEOC will continue to bring sex discrimination claims on behalf of transgender employees, but will use this opinion to remedy flaws in their strategy, for instance, in their approach to the least restrictive means test for gender-based dress code policies.

Instead of taking a reactionary approach and waiting for Title VII to evolve or for the EEOC to remedy their case theories, employers should be proactive in revising their policies to be gender-neutral when possible and contemplative of any employment requirement that might affect transgender employees.  As both employees and laws change, employers should follow suit now before having to pay to defend one later.

Our loyal blog readers can also find this post on our Workplace Class Action Blog here.

supremecourtBy Gerald L. Maatman, Jr., Christina M. Janice, and Alex W. Karasik

Seyfarth Synopsis: In a landmark case for EEOC litigation involving fee sanctions, while employer CRST successfully argued that a ruling “on-the-merits” is not necessary to be a prevailing party, the SCOTUS remanded the case back down to the Eighth Circuit to determine whether a preclusive judgment existed and if the EEOC should be responsible to pay over $4.5 million in fees as a sanction.

Today, the U.S. Supreme Court issued its much anticipated ruling in EEOC v. CRST Van Expedited, Inc., unanimously ruling in favor of the employer. We have kept our blog readers up to date on this litigation as it wound through the lower courts and progressed at the Supreme Court.  Readers can find the previous posts here, here, here, here, here, here, here, here, here, here, here, and here.

At stake was the largest fee sanction award ever levied against the EEOC — nearly $4.7 million.  While the SCOTUS remanded the case back to the U.S. Court of Appeals for the Eighth Circuit for further proceedings, and therefore did not directly rule on the appropriateness of the record fee sanction, the Supreme Court nonetheless held that a favorable ruling on the merits is not a necessary predicate to find that a defendant is a “prevailing party” for purposes of recovering legal fees under Title VII.

Though a procedural ruling, EEOC v. CRST Van Expedited, Inc. is apt to have significant practical implications for the future of EEOC litigation.

Case Background

Finding that the EEOC’s actions in pursuing this lawsuit were unreasonable, contrary to the procedure outlined by Title VII, and imposed an unnecessary burden on the employer and the judicial process, the U.S. District Court for the Northern District of Iowa granted CRST’s motion for an award of attorneys’ fees and costs, directing the EEOC to pay CRST a record fee sanction of nearly $4.7 million.  On the EEOC’s appeal, the Eighth Circuit reversed and held that the District Court “did not make particularized findings of frivolousness, unreasonableness, or groundlessness as to each individual claim” and remanded these claims to the District Court to make such individualized determinations.  Further, the Eighth Circuit found that the District Court’s dismissal of 67 claims based on the EEOC’s failure to satisfy Title VII’s pre-suit obligations “[did] not constitute a ruling on the merits,” and that “[t]herefore, CRST is not a prevailing party as to these claims.”  Accordingly, the Eighth Circuit’s holding provided the EEOC some breathing room in terms of complying with its Title VII pre-suit obligations.

In its Supreme Court brief, CRST asserted two arguments as to why the Eighth Circuit’s decision was improper.  First, CRST argued that the Eighth Circuit’s rule that a prevailing defendant may recover fees only when a case is decided “on the merits” has no basis in the statute, conflicts with Christiansburg Garment Co. v. EEOC, 434 U.S. 412, 422 (1978), and severely undermines the policy of Section 706(k) of Title VII.  Second, CRST posited that even if the “on the merits” standard applied, CRST was successful on the merits when it defeated certain claims by demonstrating that the EEOC did not investigate, find reasonable cause for, or attempt to conciliate any of these claims as required by the statute.  In essence, CRST asserted that the EEOC never identified the allegedly injured workers prior to filing its lawsuit; instead, it filed suit and then fished for the identities of the claimants by using discovery.

In its response, having abandoned its original contention that only a dismissal “on the merits” may be the subject of an attorneys’ fee award, the EEOC argued that the District Court’s finding that the EEOC failed to satisfy Title VII’s administrative preconditions to filing a lawsuit did not authorize an award of attorneys’ fees under 42 U.S.C. 2000e-5(k), because such a dismissal does not make the defendant a “prevailing party.”  The EEOC further noted the District Court’s original dismissal was not “with prejudice,” and that the later agreed-upon “with prejudice” dismissal did not and could not modify the District Court’s earlier dismissal of the claims at issue here, which had already been affirmed by the Eighth Circuit.  Finally, citing Mach Mining, LLC v. EEOC, 135 S. Ct. 1645, 1656 (2015), the EEOC also contended that the award of attorneys’ fees and costs in this litigation was improper because the Commission’s suit was not “frivolous, unreasonable, or groundless.”

During the oral arguments on March 29, 2016, the Supreme Court asked nearly twice as many questions to the EEOC’s counsel than the Justices did to CRST’s counsel.  The grilling of the government is best summarized with a notable quote from Chief Justice Roberts, who opined that conciliation without the threat of fees would not necessarily incentivize the EEOC to abide by Title VII obligations, “But if they were subject to fees because they ignored their duty to conciliate, it seems to me that might give them some incentive to get it right the first time.”  Our blog post on that argument is here.

The Supreme Court’s Ruling

In vacating the judgment of the Eighth Circuit, the Supreme Court ­unanimously held that a favorable ruling on the merits is not a necessary predicate to find that a defendant is a “prevailing party” in order to recover attorneys’ fees under Title VII.

After thoroughly detailing the intricate procedural history of this ten-year litigation, the Supreme Court initially noted the question of whether the petitioner was a prevailing party was the central issue presented by the decision of the Eighth Circuit.  Id. at 3.  The Supreme Court opined that “[c]ommon sense undermines the notion that a defendant cannot ‘prevail’ unless the relevant disposition is on the merits . . . The defendant may prevail even if the court’s final judgment rejects the plaintiff ’s claim for a non-merits reason.”  Id. at 12.  The Supreme Court reasoned that this is so because while a plaintiff seeks a “material alteration in the legal relationship between the parties that is in its favor, a defendant seeks to prevent that material alteration.  Where the defendant succeeds and the plaintiff’s challenge is “rebuffed,” the defendant prevails.  Id.

Looking beyond the letter of Title VII to Congressional intent in enacting a fee shifting statutory scheme, the Supreme Court noted that “Congress must have intended that a defendant could recover fees expended in frivolous, unreasonable, or groundless litigation when the case is resolved in the defendant’s favor, whether on the merits or not. Imposing an on-the-merits requirement for a defendant to obtain prevailing party status would undermine that congressional policy by blocking a whole category of defendants for whom Congress wished to make fee awards available.”  Id. at 13.  Accordingly, the Supreme Court held that neither the text of the fee-shifting statute nor the policy which underpins it counsels in favor of adopting the Eighth Circuit’s on-the-merits requirement.  Id. at 14.

Turning to the EEOC’s specific arguments, the Supreme Court observed that the EEOC had abandoned its defense of the Eighth Circuit’s requirement that a party prevail on the merits, and instead urged the Supreme Court to hold that a defendant must obtain a “preclusive” judgment in order to prevail.  Id.  The Supreme Court declined to decide this issue, and noted in an implied bench-slap how the EEOC “changed its argument between the certiorari and merits stages… [and] [a]s a result, the Commission may have forfeited the preclusion argument by not raising it earlier.”  Thus, the Supreme Court took issue with the EEOC’s strategy of advancing new arguments at the “11th hour,” and further noted that this tactic resulted in inadequate briefing on the issue.  Id. at 15.

In addition, the Supreme Court avoided consideration of the EEOC’s argument that even if CRST was the prevailing party, the EEOC should prevail upon the fee request because its claim that it had satisfied its pre-suit obligations was not frivolous, unreasonable, or groundless.  Noting that the Court of Appeals had not decided this “fact sensitive issue,” the Supreme Court declined to address it.  Id.

By remanding the case for further proceedings consistent with its holding that a party need not prevail “on the merits” to be eligible to recover attorney fees under Title VII, the Supreme Court left the door open for the EEOC to continue to defend against CRST’s fee petition. That being said, the record and the circumstances in the case suggest rough sledding for the EEOC on remand and the likelihood of having to face a record-setting fee sanction for its litigation tactics.

Implications For Employers

In the context of potential fee sanction motions brought by employers mired in improper EEOC litigation, the Supreme Court’s holding that a favorable ruling “on the merits” is not a necessary for an employer to seek an award of legal fees in EEOC-initiated Title VII litigation can certainly be beneficial to employers.

In practice, the SCOTUS decision may well have the significant practical effect of forcing the EEOC to “come clean” during conciliation and to provide fulsome information about the identities, number, and alleged injuries of claimants rather than threatening employers with the costs and adverse publicity of a systemic lawsuit. Clearly, a litigation strategy based on “fishing for claimants” after filing a lawsuit is a process that is likely to be deemed inconsistent with the proper utilization of taxpayer dollars for enforcing Title VII.

Readers can also find this post on our Workplace Class Action blog here.

moneyBy Gerald L. Maatman, Jr., Christina M. Janice, and Alex W. Karasik

Yesterday the U.S. Supreme Court heard oral arguments in EEOC v. CRST Van Expedited, Inc.

Involving the largest fee sanction award ever levied against the EEOC – nearly $4.7 million –  EEOC v. CRST Van Expedited, Inc. may be one of the most important cases on EEOC litigation issues in years.  The stakes are high for employers and the EEOC alike.

At issue in this case is whether and under what circumstances an employer can recover attorneys’ fees from the EEOC where the EEOC fails to satisfy its pre-suit investigation duties under Title VII.  Here is our analysis of the course of the arguments (a copy of the hearing transcript is here).

A Thumbnail Sketch Of The Key Facts Of The Case

Section 706(k) authorizes district courts to award attorneys’ fees to the “prevailing party” in a Title VII case.  In relevant part, Christiansburg Garment Co. v. EEOC, 434 U.S. 412, 421 (1978), held that fee awards to a prevailing defendant are permissible only if the plaintiff’s lawsuit was “frivolous, unreasonable, or without foundation.”

After CRST successfully obtained the dismissal of the EEOC’s Title VII claims for sexual harassment, the District Court granted CRST’s motion for an award of attorneys’ fees and costs and directed the EEOC to pay CRST nearly $4.7 million, finding that the EEOC’s actions in pursuing this lawsuit were unreasonable, contrary to the procedure outlined by Title VII, and imposed an unnecessary burden on both CRST and the District Court.

On the EEOC’s appeal, the Eighth Circuit reversed and held that the District Court “did not make particularized findings of frivolousness, unreasonableness, or groundlessness as to each individual claim” and remanded these claims to the District Court to make such individualized determinations.  Further, the Eighth Circuit found that the District Court’s dismissal of 67 claims based on the EEOC’s failure to satisfy Title VII’s pre-suit obligations “[did] not constitute a ruling on the merits,” and that “[t]herefore, CRST is not a prevailing party as to these claims.”  The Eighth Circuit also held that CRST could not satisfy the Christianburg standard for the same reason: “[P]roof that a plaintiff’s case is frivolous, unreasonable, or groundless is not possible without a judicial determination of the plaintiff’s case on the merits.”  Thereafter, following CRST’s petition for certiorari, the SCOTUS accepted the case for review.

The Employer’s Position

In its briefing, CRST asserted two arguments as to why the Eighth Circuit’s decision was improper.  First, CRST argued that the Eighth Circuit’s rule that a prevailing defendant may recover fees only when a case is decided “on the merits” has no basis in the statute, conflicts with Christiansburg, and severely undermines the policy of Section 706(k).

Second, CRST posited that even if the “on the merits” standard applied, CRST was successful on the merits when it defeated certain claims by demonstrating that the EEOC did not investigate, find reasonable cause for, or attempt to conciliate any of these claims as required by the statute. Accordingly, CRST asserted that the precedent created by the Eighth Circuit’s decision would allow the EEOC to entirely abandon its pre-suit responsibilities with impunity, which would lead to one-sided and inefficient conciliations.

Following the briefs submitted by the EEOC, which clearly abandoned its argument that the Eighth Circuit’s rule that a resolution “on the merits” is a precondition for a fee award, CRST’s reply briefing requested that the SCOTUS abrogate the Eighth Circuit’s rule as being without any foundation under Title VII.  CRST also attacked the EEOC’s newly asserted theory that attorneys’ fees were unwarranted because only preclusive judgments in favor of defendants support “prevailing party” status.  CRST argued that because the EEOC did not raise this “prevailing party” argument at any time during the last six years of litigation, the argument had been waived.  CRST also asserted that the only substantive issue properly before the SCOTUS was whether the EEOC’s pre-suit conduct rendered its lawsuit “frivolous, unreasonable, or groundless” under Christianburg, and that the District Court acted within its discretion when it found that the EEOC abandoned its Title VII obligations.

The Government’s Position

Having abandoned its contention that only a dismissal “on the merits” may be the subject of an attorney fee award, the EEOC argued that the District Court’s finding that the EEOC failed to satisfy Title VII’s administrative preconditions to filing a lawsuit did not authorize an award of attorneys’ fees under 42 U.S.C. 2000e-5(k), because such a dismissal does not make the defendant a “prevailing party.”

The EEOC further noted the District Court’s original dismissal was not “with prejudice,” and that the later agreed-upon “with prejudice” dismissal did not and could not modify the District Court’s earlier dismissal of the claims at issue here, which had already been affirmed by the Eighth Circuit.

Further, the EEOC also contended that the award of attorneys’ fees and costs in this litigation was improper because the Commission’s suit was not “frivolous, unreasonable, or groundless.”  Citing Mach Mining, LLC v. EEOC, 135 S. Ct. 1645, 1656 (2015), which has become routine practice for the Government, the EEOC asserted that the District Court improperly found that the EEOC failed to satisfy its pre-suit obligations because it did not separately investigate, make a reasonable-cause determination, and conciliate with respect to each individual woman for whom it ultimately sought relief.

The SCOTUS Oral Argument

While both sides endured their fair share of questioning from the Justices at yesterday’s hearing, the questioning put to the Government was noticeably pointed and plentiful.

If a questioning scorecard is indicative of the issues, it broke out this way by our rough tally:

Questions To CRST – 46 in the opening argument and 5 questions in the rebuttal argument [questions by Justice – Kagan (16), Ginsburg (14), Sotomayor (13), Kennedy (6), Breyer (3), and Alito (0)]

Questions To The EEOC – 72 in the opposition argument [questions by Justice – Breyer (25), Roberts (21), Alito (9), Kagan (6), Kennedy (6), Sotomayor (4), and Ginsburg (1)]

The EEOC was noticeably pressed about why it should not be held responsible for bringing the lawsuit that was later dismissed.  Moments into the EEOC’s argument, Justice Alito asked “In your brief in opposition, you argued that the Eighth Circuit was correct; did you not?”  After admitting it did so, Justices Alito and Breyer followed up by asking if the EEOC had abandoned its positon.  After several attempts to dance around the question, the Government finally admitted to abandoning the Eighth Circuit’s view regarding the necessity of a disposition on the merits.  Justice Breyer then continued to hammer the Government, asking “So if they won, why isn’t that the end of it?  It says judgment — it says … the case is dismissed with prejudice.  Therefore, they won.  So why aren’t they the prevailing party?”  The EEOC’s responses hardly pleased the questioning Justice.

After constant grilling from several Justices, Justice Kennedy finally summarized the Government’s position in a question where his tone was certainly revealing: “your position that no matter how unreasonable the plaintiff has been, no matter how costly it’s been, no matter how long it’s taken, that you cannot award fees unless …  the case is dismissed, and the judge says you’re barred from bringing this claim in this suit, no fees; that’s your position.”  Not surprisingly, given its recent attitude that it can abandon the pre-suit Title VII obligations and seemingly litigate with impunity, the EEOC responded “that’s correct.”  The Government also asserted that the notion of “prevailing party” was a term of art.  As was the case with most of the Government’s responses, the Justices were left with more questions than answers.

In sum, the SCOTUS hardly seemed convinced by the Government’s ever-evolving arguments.  Justice Sotomayor did float the idea of the case being remanded to the Eighth Circuit.  But perhaps most tellingly, in light of the Government’s persistent use of Mach Mining as a crutch to avoid judicial scrutiny, Chief Justice Roberts posited the notion that conciliation without the threat of fees would not necessarily incentivize the EEOC to abide by Title VII obligations, “But if they were subject to fees because they ignored their duty to conciliate, it seems to me that might give them some incentive to get it right the first time.”

What’s Next

A future SCOTUS ruling should provide guidance regarding whether and under what circumstances an employer can recover attorneys’ fees from the EEOC when the EEOC fails to satisfy its pre-suit investigation duties under Title VII.

Reading the tea leaves at the Supreme Court, the Government offered little justification for its pre-suit conduct (or lack thereof).  The Supreme Court clearly seemed concerned with the Government’s abandonment of its duties, and while the Supreme Court may not go so far as to uphold the District Court’s award of attorneys’ fees to CRST, it would not be surprising to see a ruling that reflects the Supreme Court’s concerns about the EEOC’s pre-suit conduct.  We expect a decision within the next few months so stay tuned.

Readers can also find this post on our Workplace Class Action blog here.

moneybagBy Gerald L. Maatman Jr., Christopher DeGroff, Christina M. Janice, and Alex W. Karasik

As we recently blogged here, EEOC v. CRST Van Expedited, Inc. is an important case on the Supreme Court’s docket that employers absolutely need to monitor.  At issue is whether attorneys’ fees are appropriate in instances where the EEOC failed to satisfy its pre-suit investigation duties under Title VII, but the employer was not 100% victorious “on the merits.”

We have been tracking developments in this litigation (here, here, here, here, here, here, here, and here) since its filing.  Earlier this month, we blogged about CRST’s submission of its merits brief to the SCOTUS on January 19, 2016, as well as several amici briefs (here, here, here and here) filed in support of CRST.  On February 24, 2016, the EEOC filed its brief with the Supreme Court.

The Context And The Stakes

As we previously reported, on September 27, 2007, the EEOC filed a single count complaint against CRST under Section 706(f) of Title VII on behalf of a female driver and a class of “similarly situated” but unidentified female employees of CRST.  Petit. Br., at 10.  The U.S. District Court for the Northern District of Iowa noted that in the course of discovery, “it became clear that the EEOC did not know how many allegedly aggrieved persons on whose behalf it was seeking relief,” and that “the EEOC was using discovery to find them.”  Id. at 11.  CRST successfully moved the District Court for the dismissal of Title VII claims for sexual harassment brought by the EEOC on behalf of several hundred female truckers, after demonstrating that EEOC did not conduct any investigation of the specific allegations of the allegedly aggrieved persons for whom it sought relief at trial before filing the Complaint – let alone issue a reasonable cause determination as to those allegations or conciliate them.

After securing the dismissals and settling the claims of the original charging party, CRST moved for an award of attorneys’ fees and costs.  The District Court granted the motion and directed the EEOC to pay CRST nearly $4.7 million, finding that the EEOC’s actions in pursuing this lawsuit were unreasonable, contrary to the procedure outlined by Title VII and imposed an unnecessary burden upon both CRST and the District Court.  Id. at 18.

The fee sanction was the largest ever imposed against the Commission.

However, on the EEOC’s appeal, the Eighth Circuit reversed and held that the District Court “did not make particularized findings of frivolousness, unreasonableness, or groundlessness as to each individual claim” and remanded these claims to the District Court to make such individualized determinations.  Id. at 20.  Further, the Eighth Circuit found that that District Court’s dismissal of 67 claims based on the EEOC’s failure to satisfy Title VII’s pre-suit obligations “[did] not constitute a ruling on the merits,” and that “[t]herefore, CRST is not a prevailing party as to these claims.”  Id. at 21.  The Eighth Circuit also held that CRST could not satisfy the standard of Christianburg Garment Co. v. EEOC, 434 U.S. 412 (1978), for the same reason: “[P]roof that a plaintiff’s case is frivolous, unreasonable, or groundless is not possible without a judicial determination of the plaintiff’s case on the merits.”  Id. (internal quotation omitted). The Eighth Circuit instructed the District Court on remand to assess each claim for which it granted summary judgment for CRST on the merits and explain why it deemed that particular claim to be frivolous, groundless, or unreasonable.

Following the Eighth Circuit’s decision, CRST petitioned for a rehearing en banc, which was denied on February 20, 2015.  Thereafter, CRST petitioned the U.S. Supreme Court for certiorari, which was granted on December 4, 2015.

In its merits brief, CRST asserts two arguments as to why the Eighth Circuit’s decision was improper: (1) the Eighth Circuit’s rule that a prevailing defendant may recover fees only when a case is decided “on the merits” has no basis in the statute, conflicts with Christiansburg Garment, and severely undermines the policy of Section 706(k); and (2) even if Congress intended Section 706(k) to limit defendants’ fee awards to cases decided “on the merits” (which it claims Congress did not do), this case would still qualify under that standard since CRST was successful on the merits.  Id. at 23-25.

The EEOC’s Brief

In its merits brief, the EEOC asserts that a district court’s finding that the EEOC failed to satisfy Title VII’s administrative preconditions to filing a lawsuit does not authorize an award of attorneys’ fees under 42 U.S.C. 2000e-5(k) because it does not make the defendant a “prevailing party.” Resp. Br., at 21-22.  According to the Commission, to be a prevailing party, a defendant must at minimum obtain a judgment barring further litigation on the Commission ’s claim; absent such a judgment, the legal relationship between the parties remains materially unchanged because the plaintiff is free to refile.  Id. at 21.

As has become a common page in the EEOC’s playbook when its satisfaction of its jurisdictional requirements under Title VII is challenged by an employer, the EEOC expansively argues that under Mach Mining, LLC v. EEOC, 135 S. Ct. 1645, 1656 (2015), the proper remedy for a district court finding that the EEOC failed to satisfy Title VII’s administrative pre-conditions to a suit is a stay, not a dismissal, and that under Costello v. United States, 365 U.S. 265, 284-288 (1961), such a dismissal does not preclude the EEOC from returning to court after the pre-condition has been met.  Id.  Under this logic, the EEOC urges the Supreme Court to conclude that dismissal does not constitute the sort of material alteration of the parties’ legal relationship required to confer prevailing party status.  Id. at 21-22.

The EEOC also argues a procedural point — that CRST incorrectly asserts that the dismissal of the relevant claims in this case had the requisite effect of being “with prejudice,” a characterization that notably did not appear in CRST’s petition for a writ of certiorari.  Id. at 22.  The EEOC notes the District Court’s original dismissal was not “with prejudice,” and that after the Eighth Circuit remanded two other claims for further proceedings and the Commission withdrew one of them, the parties settled the Commission’s final claim and agreed to dismiss the case “with prejudice.”  Id.  The EEOC argues that the agreed-upon dismissal did not and could not modify the District Court’s earlier dismissal of the claims at issue here, which had already been affirmed by the Eighth Circuit.  Id.

The EEOC further argues that CRST’s policy argument regarding the need for fee awards to encourage the Commission to adhere to its pre-suit duties under Title VII is misplaced.  Id.  In this respect, the EEOC contends that CRST should have identified and raised earlier in the litigation any allegations that the EEOC failed to satisfy its pre-suit obligations.  As a result of waiting over 18 months into the litigation to raise such issues, CRST is itself responsible for incurring substantial attorneys’ fees.  Id. at 23.

In its second argument, the EEOC contends that the award of attorneys’ fees and costs in this litigation was improper because the Commission’s suit was not “frivolous, unreasonable, or groundless” under Christiansburg Garment.  Resp. Br., at 21-23.

Again, the EEOC raises Mach Mining as a shield, asserting that the District Court’s finding was improper insofar as it determined that the EEOC failed to satisfy its pre-suit obligations because it did not separately investigate, make a reasonable-cause determination, and conciliate with respect to each individual woman for whom it ultimately sought relief.  Here, the EEOC cites Mach Mining, 135 S. Ct. at 1656, as support for the proposition that the EEOC may satisfy its conciliation obligations by identifying the “class of employees” for which it seeks relief.  Id.  The EEOC posits that “[u]nder the Eighth Circuit’s merits decision in this case, no court of appeals had held that the EEOC is required to identify all claimants during its investigation and individually conciliate their claims, and several courts of appeals such as the 9th Circuit had expressly recognized that the EEOC is ‘not required to provide documentation of individual attempts to conciliate on behalf of each potential claimant.’”  Id. at 51 (citing EEOC v. Bruno’s Rest., 13 F.3d 285, 289 (9th Cir. 1993)). In the absence of such authority, the EEOC asserts there is no basis to conclude its position was frivolous, unreasonable, or groundless.  Id. at 52.

In sum, the EEOC makes some bold arguments. In so doing, the Commission is angling to secure further Supreme Court precedent to assist in its prosecution of systemic enforcement litigation.

What’s Next

The Supreme Court is set to hear oral arguments on March 28, 2016.  With Supreme Court Justice Antonin Scalia’s recent passing, it is likely the case may be decided before the vacancy on the Supreme Court is filled.  A 4 – 4 vote would leave the Eighth Circuit decision intact and allow the EEOC to escape meaningful accountability for failure to satisfy its jurisdictional requirements under Title VII.  Further, a 4 – 4 vote may leave other appellate courts across the country without Supreme Court guidance on the EEOC’s latest effort to expand Mach Mining as a protective shield. Stay tuned, as we promise to keep our loyal blog readers updated.

Readers can also find this post on our Workplace Class Action blog here.

Bsupremecourty Gerald L. Maatman, Jr., Christina M. Janice, and Alex W. Karasik

EEOC v. CRST Van Expedited, Inc. is a key case for all employers.

We have been tracking the developments (here, here, here, here, here, here, here, and here) in this case since its inception. Now it has reached the U.S. Supreme Court on the issue of whether attorneys’ fees are appropriate in instances where the EEOC failed to satisfy its pre-suit investigation duties under Title VII, but the employer was not victorious “on the merits.”  In EEOC v. CRST Van Expedited, Inc., 774 F.3d 1169 (8th Cir. 2014), the U.S. Court of Appeals for the Eighth Circuit reversed and remanded a nearly $4.7 million award of attorneys’ fees – the largest fee sanction ever levied against the Commission – to the employer, CRST, finding that the District Court’s dismissal of 67 claims based on the EEOC’s failure to satisfy Title VII’s pre-suit obligations did not constitute a ruling on the merits, and therefore the employer was not a “prevailing party” entitled to a fee award as to those claims.  On remand, the District Court was instructed to individually assess each claim for which it granted summary judgment for CRST on the merits and explain why it deemed that particular claim to be frivolous, groundless, or unreasonable.

Following the decision, CRST petitioned for a rehearing en banc, which was denied on February 20, 2015.  Thereafter, CRST petitioned the U.S. Supreme Court for certiorari, which was granted on December 4, 2015.  On January 19, 2016, CRST submitted its merits brief, which presented the following question to the Supreme Court: whether a dismissal of a Title VII case, based on the EEOC’s total failure to satisfy its pre-suit investigation, reasonable cause, and conciliation obligations, can form the basis of an attorneys’ fee award to the defendant under 42 U.S.C. § 2000e-5(k).

On January 26, 2016, the Equal Employment Advisory Council, National Federation of Independent Business, and Small Business Legal Center filed an amici brief in support of CRST.  Others filing amicus briefs in support of CRST included Americans for Forfeiture Reform (here); Bass Pro Shops Outdoor World, LLC and Tracker Marine Retail, LLC (here); and the U.S. Chamber of Commerce, American Trucking Associations, Inc., and Business Roundtable (here).

Hence, the stage is set for what may well be one of the most important rulings on EEOC litigation in memory.

The Context And The Stakes

On September 27, 2007, the EEOC filed a single count complaint against CRST under Section 706(f) of Title VII on behalf of a female driver and a class of “similarly situated” but unidentified female employees of CRST.  Id. at 10.  The U.S. District Court for the Northern District of Iowa noted that in the course of discovery, “it became clear that the EEOC did not know how many allegedly aggrieved persons on whose behalf it was seeking relief,” and that “the EEOC was using discovery to find them.”  Id. at 11.  CRST successfully moved the District Court for the dismissal of Title VII claims for sexual harassment brought by the EEOC on behalf of several hundred female truckers, after demonstrating that EEOC did not conduct any investigation of the specific allegations of the allegedly aggrieved persons for whom it sought relief at trial before filing the Complaint — let alone issue a reasonable cause determination as to those allegations or conciliate them.

After securing the dismissals and settling the claims of the original charging party, CRST moved for the award of attorneys’ fees and costs.  The District Court granted the motion and directed the EEOC to pay CRST nearly $4.7 million in attorneys’ fees and costs, finding that the EEOC’s actions in pursuing this lawsuit were unreasonable, contrary to the procedure outlined by Title VII and imposed an unnecessary burden upon CRST and the District Court.  Id. at 18.  However, on appeal the Eighth Circuit held that the District Court “did not make particularized findings of frivolousness, unreasonableness, or groundlessness as to each individual claim” and remanded these claims to the District Court to make such individualized determinations.  Id. at 20.  Further, the Eighth Circuit found that that District Court’s dismissal of 67 claims based on the EEOC’s failure to satisfy Title VII’s pre-suit obligations “[did] not constitute a ruling on the merits,” and that “[t]herefore, CRST is not a prevailing party as to these claims.”  Id. at 21.  The Eighth Circuit also held that CRST could not satisfy the standard of Christianburg Garment Co. v. EEOC, 434 U.S. 412 (1978), for the same reason: “[P]roof that a plaintiff’s case is frivolous, unreasonable, or groundless is not possible without a judicial determination of the plaintiff’s case on the merits.”  Id. (internal quotation omitted).

Following the Supreme Court’s eventual ruling, this case will provide guidance on how employers can pursue attorneys’ fees and costs in the increasingly common instances where the EEOC has abandoned its pre-suit duties required by Title VII.

CRST’s Brief

In its brief, CRST makes two arguments as to why the Eighth Circuit’s decision was improper.  First, CRST argues that the Eighth Circuit’s rule that a prevailing defendant may recover fees only when a case is decided “on the merits” has no basis in the statute, conflicts with Christiansburg, and severely undermines the policy of Section 706(k).  Id. at 23.  In relevant part, Section 706(k) authorizes district courts to award attorneys’ fees to the “prevailing party” in a Title VII case.  Id. at 22.  Christianburg held that fee awards to a prevailing defendant are permissible only if the plaintiff’s lawsuit was “frivolous, unreasonable, or without foundation.”  Id. (quoting Christiansburg Garment Co. v. EEOC, 434 U.S. 412, 421 (1978)).  CRST contends that “categorically denying fees in such cases [not decided on the merits] would frustrate the congressional policy choice embodied in Section 706(k): to ensure that plaintiffs who impose unnecessary and unreasonable litigation costs on defendants will bear the costs of their own choices.”  Id. at 24.  Further, CRST notes that “[a]s lower courts applying Christiansburg have repeatedly recognized, that decision to litigate can be unreasonable for many reasons that do not bear on the ultimate merits of the claims — including, for example, when the suit is obviously time-barred or moot.”  Id. at 24.  Accordingly, CRST asserts that the precedent created by the Eighth Circuit’s decision would allow the EEOC to entirely abandon its pre-suit responsibilities with impunity, which would lead to one-sided and inefficient conciliations.  Id. at 25.

Second, CRST posits that even if Congress intended Section 706(k) to limit defendants’ fee awards to cases decided “on the merits,” which it claims Congress did not do, this case would still qualify under that standard.   Id.  CRST notes that “Title VII’s pre-suit requirements are substantive, mandatory conditions that determine whether a court may hold an employer liable in a case brought by the EEOC” and that the “EEOC’s claims were dismissed in this case because the EEOC failed…to first determine whether the allegations that it intended to litigate had sufficient merit to warrant requiring CRST to defend itself in court.”  Id. at 25-26.  Accordingly, given that these pre-suit requirements were elements of the EEOC’s cause of action, CRST argues that it prevailed on the merits when it defeated certain claims by demonstrating that the EEOC did not investigate, find reasonable cause for, or attempt to conciliate any of these claims as required by the statute.  Id. at 42.

Amici Briefs Filed In Support Of CRST

The amici submission filed by the Equal Employment Advisory Council argues that the Eighth Circuit’s decision was contrary to Title VII’s text, policy aims, and purposes and was inconsistent with the Supreme Court’s decision in Christiansburg.  Amici Brief, at 9.  The amici brief notes that while “Title VII expressly authorizes courts to award a prevailing party, ‘other than the Commission or the United States, a reasonable attorney’s fee (including expert fees) as part of the costs ….’ 42 U.S.C. § 2000e5(k)…[i]t places no conditions on the court’s discretion to award such fees, except to specify attorney’s fees are not available if the prevailing party is either the EEOC or another federal government agency.”  Id. at 10.  Accordingly, the amici brief posits that Title VII does not limit the award of attorneys’ fees and costs to parties who have prevailed on the merits, contrary to the Eighth Circuit’s holding.  Id. at 12.

Further, the amici brief asserts the Eighth Circuit misapplied Christianburg, which involved a claim for attorney’s fees based on the dismissal of an EEOC suit on procedural grounds.  Id. at 10-11.  The amici brief argues that the Eighth Circuit “purports to absolve the EEOC of any liability for a prevailing defendant’s attorneys’ fees in cases dismissed based on anything other than a final adjudication of the discrimination claim on the merits, [and] is irreconcilable with Title VII’s plain text and [the Supreme Court’s] interpretation of it in Christiansburg.”  Id. at 11.  Finally, the amici brief describes policy reasons for awarding attorneys’ fees in cases such as this one, noting “in its zeal to litigate large, high profile class-based suits, the EEOC’s enforcement priorities seemingly have focused less on informal resolution of discrimination charges, as contemplated by Title VII, and more on developing and maintaining a broad, class-based litigation docket.”  Id.  As such, contrary to the Eighth Circuit’s holding, amici assert that courts should not tolerate such improper conduct by the EEOC, which would be deterred by entitling prevailing defendants to reasonable attorneys’ fees and costs.

What’s Next

The Supreme Court is set to hear oral arguments on March 28, 2016 before ultimately issuing a final ruling.  Employers should pay close attention to the Supreme Court’s eventual ruling in this case.  While a favorable ruling for CRST would undoubtedly serve as a wake-up call to the EEOC in regards to fulfilling its pre-suit duties, an unfavorable ruling could have an adverse effect on employers as the EEOC could seemingly neglect its pre-suit responsibilities without having to fear any subsequent sanction.  We will keep our loyal blog readers updated as developments occur in this litigation.

Readers can also find this post on our Workplace Class Action blog here.

sealBy Gerald L. Maatman, Jr., Christina M. Janice, and Alex W. Karasik

Following the U.S. Supreme Court’s landmark decision in Mach Mining v. EEOC, 135 S.Ct. 1645 (2015), which held that a judge may review whether the EEOC satisfied its statutory obligation to attempt conciliation before filing suit, and that the scope of that review is narrow, the litigation was remanded to the U.S. District Court for the Southern District of Illinois for further proceedings consistent with that ruling. Subsequently, the EEOC renewed its motion for partial summary judgment that originally had been denied by the District Court, and filed motions to strike Mach Mining’s evidence regarding the conciliation process. Applying the Supreme Court’s ruling that we previously blogged about here, Judge J. Phil Gilbert of the U.S. District Court for the Southern District of Illinois granted in part the EEOC’s  motions to strike with respect to evidence of communications during conciliation, and granted the EEOC’s renewed motion for partial summary judgment as to Mach Mining’s defense of failure to conciliate. EEOC v. Mach Mining, LLC, No. 11-cv-00879-JPG-PMF (S.D. Ill. Jan. 19, 2016).

This decision is required reading for employers engaged in EEOC investigations, conciliations and enforcement litigation.

Case Background

In 2011, the EEOC filed suit on behalf of a class of female applicants who had applied for non-office jobs at Mach Mining’s Johnston City, Illinois facility. According to the EEOC, Mach Mining “has never hired a single female for a mining-related position,” and “did not even have a women’s bathroom on its mining premises.” Id. at 1. The complaint alleged that since January 1, 2006 Mach Mining engaged in a pattern or practice of unlawful discrimination on the basis of sex, in violation of Title VII. In its answer, Mach Mining asserted the EEOC’s failure to conciliate in good faith under 42 U.S.C. § 2000e-(5)(b) as an affirmative defense to the litigation.

The EEOC moved for partial summary judgment on Mach Mining’s affirmative defense of failure to conciliate. The District Court denied the motion, finding that the EEOC was not entitled to judgment as a matter of law as the EEOC’s pre-suit duty to conciliate was subject to at least some level of judicial review. Id. at 2. The EEOC then filed a motion for reconsideration or, in the alternative, for certification for appeal under 28 U.S.C. §1292(b). The District Court held oral arguments and denied reconsideration of its order, but granted the motion to certify. The Seventh Circuit ultimately reversed and remanded the case back to the District Court for proceedings on the merits. Mach Mining then petitioned for certiorari to the Supreme Court, which was granted.

The Supreme Court heard arguments on January 13, 2015 and decided on April 29, 2015 that, a judge “may review whether the EEOC satisfied its statutory obligation to attempt conciliation before filing suit…[but] the scope of that review is narrow, thus recognizing the EEOC’s extensive discretion to determine the kind and amount of communication with an employer appropriate in any given case.” Mach Mining, LLC v. EEOC, 135 S.Ct. at 1649 (2015). The Supreme Court reasoned that narrow judicial review of the EEOC’s pre-suit duty to attempt conciliation prior to litigation was appropriate, given the confidential nature of conciliation and the discretion afforded the EEOC under Title VII to determine how to attempt conciliation.  Accordingly, the judgment of the Court of Appeals was vacated and the matter was remanded back to the Seventh Circuit for further proceedings. The Seventh Circuit then remanded the case back to the District Court for proceedings consistent with the opinion of the Supreme Court.

The EEOC subsequently renewed its motion for partial summary judgment on Mach Mining’s affirmative defense of failure to conciliate, arguing that it had sufficiently demonstrated attempting conciliation with Mach Mining, and compliance with 42 U.S.C. § 2000e-5(b). The EEOC also filed two motions to strike, arguing in the first motion that a portion of Mach Mining’s opposition to summary judgment revealed confidential information about the conciliation process in derogation of 42 U.S.C. § 2000e-5. The District Court previously had denied the EEOC’s attempts to strike this information, agreeing with Mach Mining that the information provided in Mach Mining’s papers was focused on what was missing from the conciliation process, as opposed to what was actually said or done during the process. The EEOC argued in the second motion that portions of Mach Mining’s exhibits and statement of additional undisputed facts in support of its opposition to the EEOC’s motion for partial summary judgment similarly should be stricken.

The District Court’s Decision

The District Court granted the EEOC’s motions to strike, in part, and granted the EEOC partial summary judgment on Mach Mining’s affirmative defense of failure to conciliate.  In doing so, the District Court observed that the Supreme Court provided guidance for limited judicial review of the informal “conference, conciliation, and persuasion” requirement of Title VII, and for what information a court may consider in its review.  The District Court relied on the Supreme Court’s reasoning that a judge “looks only to whether the EEOC attempted to confer about a charge, and not to what happened (i.e., statements made or positions taken) during those discussions.”  Mach Mining, No. 11-CV-00879, at 4. The District Court determined that while substantive details had not been disclosed by Mach Mining in its court filings, nevertheless specifics as to that was “said or done” during the conciliation process were disclosed, and went beyond “whether EEOC attempted to confer about a charge.” Id. at 5. Accordingly, the District Court granted the EEOC’s motions to strike portions of Mach Mining’ opposition papers and supporting exhibit.

The District Court declined to strike, however, portions of Mach Mining’s filings attesting to a letter sent by the EEOC stating that conciliation efforts had failed, as well as the date of the lawsuit. The District Court noted that the EEOC previously had stated that such letters were available for review, that the date of filing was a public record, and that information regarding the EEOC’s fiscal year was also publicly available. Id. at 5-6. Accordingly, the District Court found that the information in these paragraphs did not concern statements made or positions taken during conciliation.

Turning to the EEOC’s renewed motion for partial summary judgment, the District Court referred to a two part test outlined in the Supreme Court’s decision to determine whether the EEOC has complied with the statutory requirement of 42 U.S.C. § 2000e-5(b): (1) the EEOC must inform the employer about the specific allegation, as it typically does in a letter announcing its determination of reasonable cause; and (2) the EEOC must try to engage the employer in an informal method of conference, conciliation, and persuasion. The District Court also emphasized that the scope of the review was narrow, looking only to whether the EEOC attempted to confer about a charge, and not to the statements made or positions taken during those discussions. Id. at 7. The District Court found that the EEOC’s letter of determination that it sent to Mach Mining on September 17, 2010 satisfied the first prong since it described Mach Mining’s alleged improper conduct and identified the aggrieved individuals.

As to the second prong, the District Court described how the EEOC provided Mach Mining with the proper notice, and as evidenced by the declaration of its own employee, the EEOC engaged in oral and written communications with Mach Mining to provide the company with the opportunity to remedy the discriminatory practices. To refute the EEOC’s affidavit, Mach Mining was required to provide an affidavit or other evidence indicating that the EEOC did not provide the requisite information about the charge or attempt to engage in a discussion about conciliating the claim. The District Court determined that the affidavit provided by Mach Mining only indicated that the EEOC did not provide all of the information that Mach Mining requested, and not that it failed to provide the requisite information. Therefore, the District Court held that the EEOC met the second prong of the test set out by the Supreme Court, and granted partial summary judgment to the EEOC. Id. at 10.

It is noteworthy that at the end of its decision, the District Court commented that “[a]lthough § 2000e-5(b) of 42 U.S.C. prohibits the disclosure of ‘anything said or done’ during the informal conciliation process, it does not prohibit disclosure of information obtained during the EEOC’s investigation and such information becomes available through discovery.” Id. This observation signals a significant difference between the EEOC’s pre-suit duties to investigate and to attempt conciliation.

Implications For Employers

Following this decision, employers can expect that in EEOC-initiated litigation, the EEOC will seek the narrowest review possible of its conciliation processes, asserting that this pre-suit condition is satisfied merely by producing a letter of determination, a notice of failure of conciliation, and an affidavit by EEOC personnel. With regard to EEOC pre-suit investigations, employers should be prepared to document the EEOC’s pre-suit investigatory conduct and enforce Title VII’s requirement of an investigation prior to the EEOC’s initiation of litigation. Armed with this decision, the EEOC will likely aim for the minimum threshold of satisfying its conciliation requirements for the foreseeable future.

Readers can also find this post on Seyfarth’s Workplace Class Action blog here.

thetopfiveBy Gerald L. Maatman, Jr., Christopher J. DeGroff, and Matthew J. Gagnon

We are pleased to offer our loyal blog readers our analysis of the five most intriguing decisions in 2015 relative to EEOC lawsuits, along with a pre-publication preview of our annual report on developments and trends in EEOC-initiated litigation. That book, entitled EEOC-Initiated Litigation: Case Law Developments In 2015 And Trends To Watch For In 2016, is a thorough analysis of the lawsuits that were filed by the EEOC in FY2015 (spanning October 2014 through September 2015), and the major decisions impacting EEOC litigation. We have analyzed those filings and decisions to bring our readers the most up-to-date examination of trends affecting the EEOC’s enforcement agenda. As always, we believe that the best way for any employer to stay out of the EEOC’s cross-hairs is to develop a deep understanding of its enforcement priorities. We hope that this year’s publication gives employers the tools they need to do exactly that.

This year we have expanded our analysis to look at new case filings and important decisions on an industry-by-industry basis. This year’s book includes individual sections devoted to enforcement trends and significant decisions impacting employers in the retail, hospitality, manufacturing, healthcare, construction/national resources, and business services industries. That analysis can be found here.

The full publication will be offered for download as an eBook. To order a copy, please click here.

We like to end our year with a look back at some of the most interesting decisions of the year. We had no trouble picking those cases for 2015. The U.S. Supreme Court handed down three decisions in 2015 that we believe will significantly impact EEOC-initiated litigation for years to come. There were also some especially intriguing decisions out of the lower courts that we believe shed light on how the EEOC will adjust tactics to pursue its enforcement agenda in 2016 and beyond.

Here is our list of the top five most interesting decisions of 2015.

  1. Mach Mining v. EEOC, 135 S. Ct. 1645 (2015).

Hands down, the most interesting, exciting, and game-changing decision of the year was the U.S. Supreme Court’s decision in Mach Mining v. EEOC. Sometimes we have to guess as to how significantly a single decision will shape the future of EEOC litigation. With Mach Mining, there is no wondering; it will have a major impact. We have devoted a special section of this year’s book to this decision, including a look back at the important cases leading up to it, and the first decisions from the lower courts that offer a glimpse as to how Mach Mining will be applied in the years to come. That section begins here.

What makes this decision so intriguing? It single-handedly dismantled the EEOC’s efforts to immunize its pre-suit conduct from judicial review. The Commission has been arguing for years in lawsuits around the country that judges are simply not authorized to review its pre-suit conduct. That includes the statutorily-required duty to conciliate a charge before bringing suit in court. In theory, meaningful conciliation would allow employers the opportunity to resolve EEOC charges before a lawsuit is filed. In practice, employers too often see the EEOC making a take-it-or-leave-it offer and then proceeding directly to litigation.

The Supreme Court rejected the EEOC’s position, holding that there is a “strong presumption favoring judicial review of administrative action.” Id. at 1651. Indeed, without the power to review the EEOC’s conciliation efforts, “the Commission’s compliance with the law would rest in the Commission’s hands alone.” According to the  Supreme Court, the point of judicial review is “to verify the EEOC’s say-so,” and to “determine that the EEOC actually, and not purportedly” met its obligations. Id. at 1653. But perhaps even more important for employers, the Supreme Court acknowledged that conciliation is a crucial step in realizing Title VII’s legislative goals, which make cooperation and voluntary compliance the “preferred means” of bringing employment discrimination to an end. Id. at 1651.

This decision is still only a few months old, and the lower courts are only just beginning to grapple with its application. Despite the Supreme Court’s strong stance in favor of judicial oversight, it outlined a fairly limited view of what that oversight would look like. Some courts have interpreted the decision narrowly, applying a minimalistic review of the EEOC’s actions. Other courts have taken a more expansive view, scrutinizing how the EEOC conducted its conciliation efforts and sending the Commission back to the drawing board if those efforts did not satisfy what Title VII requires. We will continue to monitor these developments for our loyal blog readers.

  1. Young v. United Parcel Service, Inc., 135 S. Ct. 1338 (2015).

On March 25, 2015, the Supreme Court issued another decision that we expect will have far-reaching effects on EEOC litigation. In Young v. United Parcel Service, Inc., the Supreme Court declined to follow the EEOC’s Enforcement Guidance on Pregnancy Discrimination and Related Issues.. In that guidance, the EEOC had sought to apply a “most-favored nation” approach to reasonable accommodations offered to pregnant employees.

This approach was summarily rejected by the Supreme Court in Young. Although the Supreme Court acknowledged that that the rulings, interpretations, and opinions of an agency charged with enforcing a particular statute are often given deference, here the Court was unimpressed by the thoroughness of the EEOC’s consideration of the issues and declined to give the EEOC’s guidance any weight. This decision leaves employers scratching their heads as to how they should interpret and apply the EEOC’s guidance post-Young. Our more fulsome review of the Young decision and its potential aftermath can be found here.

  1. EEOC v. Abercrombie & Fitch Stores, Inc., 135 S. Ct. 2028 (2015).

The Commission’s guidance on religious garb and grooming fared much better before the Supreme Court. In Abercrombie & Fitch Stores, Inc., the Supreme Court held that an employer that is without direct knowledge of an employee’s religious practice can be liable under Title VII for religious discrimination if the need for an accommodation was a motivating factor in the employer’s decision, whether or not the employer knew of the need for a religious accommodation. “[T]he rule for disparate-treatment claims based on a failure to accommodate a religious practice is straightforward: An employer may not make an applicant’s religious practice, confirmed or otherwise, a factor in employment decisions.” Id. at 2033. Although the EEOC’s guidance was not specifically mentioned in the Court’s decision, this rule is consistent with the “knowledge” requirement set forth in the EEOC’s guidance.

Like Mach Mining, this is a new decision that the lower courts are only just beginning to apply. Religious discrimination is a hot-button topic for the EEOC, so the repercussions of the Abercrombie decision will be an important issue to watch in 2016 and beyond. Our discussion of Abercrombie and other religious discrimination developments can be found here.

  1. EEOC v. Doherty Enterprises., Inc., No. 14-CV-81184, 2015 U.S. Dist. LEXIS 116189 (S.D. Fla. Sept. 1, 2015).

One of the most interesting decisions in 2015 to come from the lower courts was out of the U.S. District Court for the Southern District of Florida. In EEOC v. Doherty Enterprises., Inc., the court arguably recognized an entirely new cause of action under section 707(a) of Title VII, which would allow the EEOC to bring pattern or practice suits without having to engage in any of the pre-suit obligations mandated by other sections of Title VII. In effect, this would be an end-run around the Mach Mining decision because the question decided in that case – whether courts have the power to oversee how the EEOC satisfies its pre-suit obligations – is irrelevant if the EEOC can skirt those obligations altogether.

The arguments and legislative history that led to this decision are complex but well worth a read. We have included an expanded discussion of this decision in this year’s book plus a discussion of a similar case from the Northern District of Illinois that came to the opposite conclusion (a conclusion that was later affirmed by the Seventh Circuit). That discussion is available here. The EEOC has now persuaded one court that Title VII gives it the authority to bring a pattern or practice claim against employers who “resist” the full enjoyment of the rights provided for by Title VII. If other courts agree with this decision, it could become a powerful new weapon in the EEOC’s enforcement arsenal.

  1. R.G. & G.R. Harris Funeral Homes, Inc., No. 2:14-CV-13710-SFC-DRG (E.D. Mich. filed Sept. 25, 2014).

Finally, we have chosen a decision out of the U.S. District Court for the Eastern District of Michigan as one of our top five most interesting cases of the year. In R.G. & G.R. Harris Funeral Homes, Inc., the EEOC secured its most explicit endorsement to date of its theory that discrimination against transgender employees is tantamount to discrimination on the basis of sex because it is based on an employer’s gender-based expectations, preferences, or stereotypes. This theory has a fascinating history.

As recently as 2010, the EEOC was turning down employees who came to them with charges of transgender discrimination, which even the EEOC did not think were covered by Title VII. But that quickly changed after the EEOC issued its own decision in a case that (arguably) arose out of its own power to hear and decide disputes brought by federal agency employees. This is a particularly interesting “case study” in how the EEOC uses all of the tools at its disposal to expand the law to fit its enforcement priorities. Our readers can read all about it here.

Now, along with its own decision, the EEOC has a federal court decision to point to in support of its new theory. On April 21, 2015, the court in R.G. & G.R. Harris Funeral Homes, Inc. denied the employer’s motion to dismiss the EEOC’s complaint, holding that “even though transgendered/transsexual status is currently not a protected class under Title VII, Title VII nevertheless ‘protects transsexuals from discrimination for failing to act in accordance and/or identify with their perceived sex or gender.’” Id. at 599 (quotations omitted)., The Court went on to observe, however, that the EEOC “appears to seek a more expansive interpretation of sex under Title VII that would include transgendered persons as a protected class,” and noted that “there is no Sixth Circuit or Supreme Court authority to support the EEOC’s position that transgendered status is a protected class under Title VII.” Id.

These decisions and others made 2015 an exceptionally fascinating year for developments in EEOC litigation. And because these decisions often raised more questions than they answered, it portends an even more interesting year to come. We look forward to bringing those developments to our readers’ attention as they happen. We wish all a happy and safe New Year!

Readers can also find this post on our Workplace Class Action blog here.