Wednesday, June 1, 2016

Supreme Court issues ruling on reverse-attorneys' fees under Title VII

In employment discrimination cases, the employer pays the plaintiff's attorneys fees if the plaintiff wins the case and gets a judgment. But that is a one-way ticket. If the employer wins the case, the plaintiff does not pay its fees unless the case is totally frivolous and groundless. The Supreme Court said that in the Christiansburg-Garment case in 1978. The Court now says that a favorable ruling on the merits is not necessary for the employer to recover reverse-fees in a Title VII case.

The case is CRST Van Expedited v. EEOC, decided on May 19. The EEOC brought this action against a trucking company, claiming it had discriminated against more than 150 women. The facts and procedural history are convoluted, but the bottom line is that a federal judge rejected the lawsuit because, in violation of its legal responsibility, the EEOC had not adequately investigated the claim. The company won over $4 million in reverse attorneys fees.

The Supreme Court says this attorneys' fees award was proper. You don't need an actual judgment on the merits of the case to trigger the reverse-fees provision. The Eighth Circuit had ruled otherwise, but that court is reversed by the Supreme Court, which says that while a ruling in the employer's favor on the merits might be what some employers actually want (in order to defend their good name), a victory of any kind in the employer's favor -- even on procedural grounds -- is also a victory. The Court reminds us that it held in Christiansburg-Garment that the reverse-fee doctrine aims to deter all frivolous lawsuits. In light of that principle, for purposes of determining if the employer can recover fees from the plaintiff, what difference does it make it the dismissal is based on the merits (i.e., the plaintiff never had a chance in hell) or some procedural basis?

Justice Thomas issues a brief concurrence. As is often the case, he sees things quite differently than the rest of the Court. He writes to state that Title VII does not actually say that defendants only get reverse fees if the plaintiff's case is frivolous. While the Court in Christiansburg-Garment said the employer only gets fees in "special circumstances," Title VII does not say that. That is a judge-made rule. Justice Thomas thinks Christiansburg-Garment is a "dubious" precedent and will not extend it any further. He does not say this, but Justice Thomas would presumably say that employers can recover fees if it wins any Title VII case, and if the Court doesn't like it, Congress can re-write the statute to confirm to the principles set forth in Christiansburg-Garment.

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