Power of the Subpoena: Will Nominee Gorsuch Limit Scope of EEOC Reach?

by Bradley Arant Boult Cummings LLP
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Just how broad is the EEOC’s subpoena power and are we likely to get some guidance soon? We’ve said before that the McLane v. EEOC case (which is about the EEOC’s subpoena power and is currently before the Supreme Court) is uncertain given President Trump’s election. Since then, we have had two developments: first, President Trump nominated Judge Neil Gorsuch, a conservative jurist from the 10th Circuit to fill the vacancy on the Court, and second, the Court heard oral arguments last week in McLane.

What Is McLane About?

In essence, McLane is about the EEOC’s subpoena power and anyone who deals with the EEOC should be interested in the facts. Damiana Ochoa worked for McLane Company, a grocery supply chain, in Arizona. When she returned from maternity leave, McLane made her take a physical strength exam. Ochoa did not pass the exam, was terminated and promptly filed an EEOC charge alleging sex/pregnancy discrimination. In its investigation, the EEOC ultimately asked McLane for pedigree information (including name, social security number, last known address and telephone) about who took the physical strength test, who passed and its reasons for terminating any employee who took it—and expanded its investigation to include facilities nationwide (more than 20,000 employees) AND to seek information about the age of the employees—even though Ochoa wasn’t in the age-protected category.

After refusing to go nationwide, McLane ultimately provided the EEOC with a lot of information but refused to provide pedigree information or information on termination decisions. The EEOC issued an administrative subpoena and sought enforcement in the Arizona federal district court. The district court split the baby and ordered McLane to provide a number of things, including any adverse employment action imposed within 90 days of taking the test, but not pedigree information or the reasons for any termination. On appeal, the Ninth Circuit reversed and vacated part of the district court’s ruling after reviewing it de novo. The EEOC appealed and it is now before the Supreme Court.

How Does the Gorsuch Nomination Affect This?

While the Senate has not yet confirmed Judge Gorsuch’s nomination, history tells us he will likely join the highest court. The rules of the Senate still allow for a filibuster of a judicial nomination, which, if exercised, would prevent a vote on the nominee absent 60 senators voting in favor of proceeding. However, Republican control of the chamber probably means a filibuster would merely delay the inevitable and Judge Gorsuch will join the bench by the late spring. Although he is likely to give employers a fifth vote in hotly contested cases, his addition to the court may be inconsequential to McLane because everyone seems to agree that the Ninth Circuit should be overturned.

What Did Oral Argument Tell Us?

Before the court in McLane is a circuit split on the proper standard of appellate review of a decision to quash or enforce an EEOC subpoena. The Ninth Circuit applied a de novo standard of review, while eight other circuits apply an “abuse of discretion” standard. This case is unusual in that the parties to the litigation agree that the Ninth Circuit should join the other circuits and adopt the deferential “abuse of discretion” standard. Given the parties’ positions, the Supreme Court appointed a lawyer to argue in favor of the Ninth Circuit’s position on de novo review. At oral argument, however, the justices hinted of a consensus in favor of the deferential standard. Most of the justices who spoke during the argument seemed to agree that an appeals court should not disturb a district court’s ruling on an EEOC subpoena unless the lower court had clearly erred.

Notably, oral argument seemed to focus more on the appropriate scope of EEOC subpoenas than on the proper standard of appellate review. Justice Ginsburg questioned the district court’s ruling, suggesting that even if the Ninth Circuit had applied the more stringent “abuse of discretion” standard, it still would have found in the EEOC’s favor that McLane’s pedigree information was relevant to the underlying investigation. Similarly, Justice Sotomayor noted that while McLane provided a list of more than 14,000 employees along with genders, test results, and adverse action within 90 days of the test, that information did not specify whether the employee had been terminated or the underlying reason for the adverse action—which she suggested supports the EEOC’s position that the pedigree information was relevant so the EEOC could communicate with the employees to determine whether failing test-takers were treated differently based on gender.

Justice Breyer seemed a bit more skeptical of the relevance catch-all. He acknowledged that relevance is a broad concept that the EEOC could use to justify seeking almost any information. In this case, one former employee alleged discrimination, but the EEOC ultimately sought information on thousands of employees, which demonstrates that relevance is a slippery slope. Justice Breyer also contemplated whether the EEOC’s subpoena could be quashed on the basis of undue burden.

What Does This Mean For Employers?

Although the only issues before the Supreme Court are the appellate review standard and the relevance of employee pedigree and termination information, the Court’s decision will hopefully provide employers guidance on how to respond to EEOC subpoenas. Can employers object to EEOC subpoenas based on the relevance and proportionality of the requested information? If the subpoena is broad and only potentially relevant to the charging party’s allegations (a classic fishing expedition), can an employer successfully argue that it is unduly burdensome? Employers should stay tuned.

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.

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