EEOC Ordered to Pay 2.6 Million for Defendant Fees and Costs

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

In a ruling handed down on August 4, 2011, District Court Judge Sean F. Cox ordered the EEOC to pay 2.6 million dollars for attorneys’ fees and costs in the case of EEOC v. Cintas [2011 U.S. Dist. LEXIS 86228].

Déjà Vu? In March 2010, we reported that in EEOC v. CRST Van Expedited [2010 U.S. Dist. LEXIS 11125], a trial judge for the Northern District of Iowa struck down a pattern or practice sexual harassment claim on behalf of 68 women and awarded $4,004,371.65 in attorneys' fees and $463,071.25 in expenses to CRST. The crux of that ruling was that the EEOC investigated the claim of one woman, and filed the lawsuit before it knew of or investigated the claims of the other 67 women. The judge ruled that the EEOC used the discovery process to find the additional women, and therefore, “wholly abandoned its statutory duties as to the remaining 67 allegedly aggrieved persons in this case.” The judge also noted that the EEOC pursued a “sue first, ask questions later litigation strategy.”

The Cintas case is a complicated one with a 10-year history. It began when 13 female plaintiffs sued Cintas for sex discrimination. In December 2005, the EEOC intervened and filed a pattern or practice suit under Section 706 of Title VII. In September 2010, the court issued a summary judgment opinion that dismissed with prejudice all of EEOC's claims against Cintas for failure to exhaust administrative remedies, and at the same time, rejected the plaintiffs’ claims based on merits. For present purposes, the key issue is that the August 4, 2011 order for attorneys’ fees and costs is based on the EEOC’s failure to investigate the 13 individual claims, as well as its failure to “engage in any conciliation measures”, a requirement of Section 706.

There are related and more complicated issues at stake in both the CRST and Cintas cases as relates to pattern or practice lawsuits by the EEOC. Readers interested in the full complexity of these issues are directed to a presentation by Donald R. Livingston on “EEOC Pattern or Practice Litigation”, presented at the ABA National Conference on EEO Law in San Antonio, Texas in March 2010 (the text of which is available here).

For present purposes, the key issues involve Section 706 v. Section 707 of Title VII as relates to pattern or practice cases. Section 706 cases may be filed by the EEOC for equitable (e.g., back pay) and legal relief (e.g. compensatory and punitive damages), but the case must be tried under the McDonnell Douglas v. Green (1973) [422 U.S. 792] burden-shifting framework for individual claims of disparate treatment. The EEOC also has the alternative option of using Section 707, which permits the classwide type of burden shifting as in International Brotherhood v. Teamsters (1977) [431 U.S. 324]. Furthermore, Section 707 permits equitable and injunctive relief. However, it does not permit legal relief.

The bottom line for present purposes is that Judge Cox ruled that the EEOC could not use the Teamsters framework because of their failure to plead pattern or practice under Section 707. Therefore, EEOC had to use Section 706 rules and prove each case individually and McDonnell Douglas rules. Of course, the court had previously ruled that these individual cases lacked merit, and because the EEOC failed to investigate and conciliate in this case, Cintas was awarded the 2.6 million dollars.

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