Labor: Courts keep sanctioning EEOC in class litigation

The EEOC recently has been quick to pull the trigger and convert most single-claimant charges into class litigation cases.

Has the EEOC gone wild with its new enforcement agenda and increased budget to pursue systemic or class claims on behalf of multiple employees or applicants? From my observations on the front lines defending against these cases, the EEOC is definitely overreaching these days and looking for ways to convert a garden-variety, single-employee charge into a class case despite facts that support any class theory of recovery. 

Some federal courts, however, are striking back and not only dismissing unfounded EEOC class cases but also sanctioning the EEOC for attorneys’ fees and costs, even in one case where the EEOC was ordered to reimburse an employer for more than $4 million in legal costs to defend itself against such frivolous litigation. In recent times, courts have found that the EEOC has rushed to judgment against some employers, failed to properly investigate and follow its own administrative requirements and attempted to pressure companies into settling on a class basis without providing sufficient explanations of the facts to support large settlement demands. 

Also, in EEOC v. Cintas Corp., the U.S. District Court for the Eastern District of Michigan dismissed a gender discrimination action filed by the EEOC on behalf of 13 women because the EEOC failed to exhaust its own administrative requirements.  Similar to the CRST case, the district court found the EEOC’s litigation strategy to be another “sue first, ask questions later” scenario. In dismissing the case, the district court found that at no time before the lawsuit was filed had the EEOC identified any of the 13 female class members. Nor did the EEOC make any individual reasonable cause determinations that any of the 13 female plaintiffs had experienced any discrimination.   And, finally, the district court noted that the EEOC had not conciliated the individual claims of the 13 female class members.

In yet another case, EEOC v. Bloomberg L.P., the U.S. District Court for the Southern District of New York recently dismissed retaliation claims as a sanction in a gender (pregnancy) discrimination lawsuit filed by the EEOC on behalf of a nationwide class of women. The district court sharply criticized the EEOC for its failure to reasonably and flexibly participate in conciliation during the administrative phase of the case before suit was filed. The district court commented that the EEOC failed to provide information to the employer so that it could analyze and formulate any reasonable monetary counteroffer to the EEOC’s “take-it-or-leave-it” settlement offer of more than $41 million. In short, the district court referred to the EEOC’s approach in conciliation as a “weapon to force settlement,” and further commented that “the EEOC cannot, when the employer reasonably asks for information to formulate a monetary counteroffer, make substantial monetary demands and require employers simply to pony up or face a lawsuit.”

Managing Shareholder

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Steve Moore

Steve Moore is the managing shareholder of Ogletree Deakins' Denver office. In addition to litigating single- and multi-plaintiff cases, Moore has represented employers against class...

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