Sixth Circuit Issues Second Victory to EEOC in Sex Discrimination Case Against Cintas Corp.

by U.S. Equal Employment Opportunity Commission (EEOC)
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Court Denies Rehearing of Its Earlier Ruling Allowing  Systemic Hiring Discrimination Case and Overturning Award of Attorney's Fees;  Cintas CEO Likely to be Deposed

WASHINGTON - In a second victory for the U.S. Equal  Employment Opportunity Commission (EEOC), the U.S. Court of Appeals for the  Sixth Circuit rejected Cintas Corporation's petition to reconsider its earlier  ruling that the EEOC was wrongly denied permission to litigate a lawsuit  alleging Cintas engaged in hiring discrimination against a class of women in  Michigan.  The court's one-page order,  issued Jan. 15, 2013, indicated that no judge had requested a vote on Cintas'  suggestion for full court review.  The  case will now return to the district court for further proceedings.

With the order, the Sixth Circuit has now made final its  ruling of November 9, 2012, in which the Court overturned  the district court's dismissal of the EEOC's  lawsuit against Cintas, reversed significant procedural rulings, ordered the  district court to reconsider whether EEOC should be allowed to depose Cintas  CEO Scott Farmer, and found "no basis" for the district court's ordering  EEOC to pay Cintas $2.6 million in attorney fees.

"The court of appeals has confirmed EEOC's ability to use  all the tools Congress provided in Title VII when EEOC challenges a pattern or  practice of discrimination," said EEOC General Counsel David Lopez.  He added that the Sixth Circuit's rulings,  coupled with Friday's decision in EEOC v. United Parcel Service, where the district court for the  Northern District of Illinois reversed its own ruling barring the EEOC from filing  a class complaint without complete information on all possible bias victims, are  a "tremendous victory for the EEOC's systemic litigation program."

The underlying litigation began in 2005 when the EEOC sued  Cintas in the U.S. District Court for the Eastern District of Michigan alleging  that it discriminated against women in hiring for its services sales  representative position in violation of Title VII of the Civil Rights Act of  1964, which prohibits sex discrimination.   The EEOC sued under § 706 of Title VII, which permits the EEOC to bring  a lawsuit in federal court.

During litigation, the district court ruled that since the  EEOC had filed suit under §706 of Title VII and not under §707, which  references suits to redress a "pattern or practice" of  discrimination, EEOC could not use the so-called Teamsters proof framework,  which allows the focus at the initial stages of litigation to be placed on  whether discrimination was the employer's "standard operating procedure,  rather than on whether the employer committed individual acts of  discrimination. The Teamsters framework is named for a 1977  Supreme Court case (International Brotherhood of Teamsters v. United States).

The district court's ruling required the EEOC to shift its  focus to individual acts of alleged discrimination, and away from what it  alleged was an overall discriminatory practice that affected a class. The  district court later denied EEOC's motions to expand discovery and to depose  the Cintas CEO, and the district court ultimately ruled it must dismiss the  EEOC's entire case because of a failure to meet the procedural requirements of  investigation and conciliation. Following that dismissal, the court  awarded Cintas $2.6 million in attorney fees and costs as the "prevailing  party" in the litigation.

The EEOC appealed the district court's rulings to the Sixth Circuit (Serrano & EEOC v. Cintas Corp., Dkt. Nos.  10-2629/11-2057). The Sixth Circuit reversed the judgments of the  district court and remanded the case for further proceedings. Significantly,  the appellate court held that EEOC may use the Teamsters proof framework  when it files a lawsuit under §706. The appellate court also held that  the EEOC had met its obligation to investigate and conciliate the charges of  discrimination, and that further discovery may well be necessary to give EEOC  more information as EEOC "proceed[s] with its claims toward  trial."   The court addressed at  length one particular area of discovery:   EEOC's desire to depose Cintas CEO Scott Farmer.  The court determined that Farmer's statements  at a corporate meeting suggested "high-level-corporate awareness of Cintas's  failure to hire females," and this awareness "goes to the heart of what the  EEOC will seek to prove in proceeding with its claims toward trial."

Finally, the Court of Appeals reversed the lower court's  grant of $2.6 million in attorney fees, holding that the district court abused  its discretion when it awarded fees on the basis of what it termed  "egregious and unreasonable conduct" by EEOC. The Sixth Circuit  held that "[t]he EEOC pursued its claim within the bounds of professional  conduct and in the good-faith belief that it had done what was necessary . . .  ."Following the Court of Appeals' order, Cintas petitioned the  Court for rehearing.

"We are pleased that the court of appeals initially recognized that  EEOC's efforts to resolve the case at the administrative stage were adequate  and that the $2.6 million fee award should be reversed, and that there was no  reason to rehear the arguments or revise that opinion," saidJennifer  Goldstein, EEOC Appellate Attorney.

EEOC's Indianapolis Regional Attorney Laurie Young added,  "We look forward to the opportunity to focus on the merits of this case in  district court, where we will now be able to present our evidence of a pattern  of sex discrimination in hiring."

The EEOC enforces federal laws prohibiting employment  discrimination. Further information about the EEOC is available on the agency's  website at www.eeoc.gov.

 

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© U.S. Equal Employment Opportunity Commission (EEOC) | Attorney Advertising

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