8TH CIRCUIT COURT UPHOLDS EEOC SUBPOENA FOR CLASSWIDE DATA BASED ON INDIVIDUAL SEX DISCRIMINATION CLAIM

by Art Gutman Ph.D., Professor, Florida Institute of Technology

The case is EEOC v. Schwan’s Home Service [ 2011 U.S. App. LEXIS 14291, 7/13/11]. The facts are that Schwan hired Kim Millren in March 2007 as a location general manager under the condition that she successfully complete the company’s General Manager Development Program (GMDP). Schwan informed Millren she lacked the leadership skills needed to graduate and offered her a customer service job. Millren refused the offer and filed a charge of sex discrimination with the EEOC, alleging, among other things, that during the GMDP training, she was subject to sexually offensive remarks and derogatory emails. End of Act 1.

In Act 2, the EEOC asked Schwan for a list of all employees participating in GMDP in 2006 and 2007 (name, gender & date of hire), to which Schwan forked over data for 2007, but not 2006, and no breakdown for gender even for 2007. Subsequently, Millren made an additional allegation that she observed a female managerial candidate rejected because she had three children at home. Millren also offered that had she graduated from GMDP she would be only one of two female managers among 500 managers nationwide. The EEOC then requested information related to Millren’s additional allegation, and reiterated its request for data (with gender breakdown) for 2006 and 2007. Schwan failed to respond, leading to an EEOC subpoena in July 2008, followed by an amended claim of classwide sex discrimination by Millren in February 2009.

Schwan mounted two defenses: (1) that the charge of systemic discrimination was time barred by Title VII’s (300 day) statue to limitations and (2) that Millren’s charge of systemic discrimination was based solely on Millren’s unsubstantiated beliefs. The 8th Circuit ruled that the timeliness charge was “premature” because “ the appropriate time to address the timeliness issue is if and when an actual lawsuit is filed, not during the subpoena enforcement stage.” On the second defense, the 8th Circuit ruled that the EEOC charge “is valid regardless of the strength of its evidentiary foundation” as long as EEOC’s basis for an administrative subpoena is “valid”, the main criterion for which is the so-called “relevancy requirement.” According to the 8th Circuit, the relevancy requirement is met as long the requested data “might cast light on the allegations” (as opposed to wandering into “wholly unrelated areas.”

The bottom line is that both the lower court and the 8th Circuit favored the EEOC’s right to subpoena the requested data. The implications of this ruling is fairly obvious. Except in cases where an administrative body engages in a “fishing expedition”, the 8th Circuit supported the right to seek data that can range well beyond an individual claim.

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