Massive EEOC Class Action Slashed to Two Claims on Appeal
On February 22, 2012, the Eighth Circuit handed the EEOC a major defeat in a putative class-wide sexual harassment case it had brought against a trucking company. EEOC v. CRST Van Expedited, Inc.pdf, Case Nos. 09-3764/09-3765/10-1682 (8th Cir. Feb. 22, 2012). While the court vacated, at least for the present, a $4.5 million sanction against the Commission, its holding vastly reduced what it claimed to be a case involving hundreds of women trucking employees.
The CRST case grew out of its training program for new truck drivers. One claimant, Monika Starke, alleged that she was both subject to sexually inappropriate remarks and forced to have sex with a lead trainer to pass the driving tests. She filed a charge of sex discrimination with the EEOC in 2005. Following multiple requests for information, the EEOC ultimately issued a letter of determination finding probable cause with respect to a “class of employees.” The EEOC and the employer exchanged some e-mails and telephone calls, and the EEOC quickly determined that further “conciliation” efforts would be “futile.” One month later, the EEOC filed suit on Starke’s behalf and on behalf of an alleged class of “similarly situated female employees.”
What followed was two years of discovery in which the EEOC steadfastly resisted identifying or defining the class members. It eventually identified a class of 270 women who it claimed were victims of hostile environment discrimination at CRST. Following additional discovery in which the EEOC refused to produce over 100 of the women for deposition, the employer moved for summary judgment. The district court ultimately:
- Dismissed the claims of 120 women for failing to appear for depositions;
- Dismissed the claims of three women, including Starke, for failing to identify their claims on bankruptcy petitions they had filed;
- Dismissed multiple claims on the grounds that the women were not harassed, did not follow the employer’s reporting procedure, or could not identify severe or pervasive discrimination as to them; and
- Dismissed the remaining claims (67 women) due to the EEOC’s failure to properly conciliate them.
The district court then sanctioned the EEOC $4.5 million based on its conduct before and after the filing of suit, a decision we discussed in this blog last year.
The Eighth Circuit reversed with respect to only two plaintiffs and the sanctions issues only. The most important part of its ruling related to the dismissal of the 67 women for the EEOC’s failure to conciliate. Citing the legislative history and the strong public policy in favor of administrative resolution of disputes, the court faulted the EEOC for using the lawsuit, rather than its pre-suit investigation, to obtain information about the potential claimants and for its resulting failure to conciliate the claims.
As to the remaining claims, it found that only two rose to the level of actionable sexual harassment and that Starke’s failure to raise the claim in her bankruptcy did not preclude the EEOC from seeking relief on her behalf.
Thus, from a high of 270 claimants, the EEOC could pursue claims only on behalf of two women. Because those two claims survived, the court vacated the large sanctions award without prejudice.
One troubling aspect of the EEOC’s conduct in the case was that, if their facts were believed, at least one of the claims (Starke’s) was serious and could and should have been resolved promptly. By piling on the claims of 268 other women with, at best, far weaker claims, the EEOC delayed any remedy for Ms. Starke by at least seven years.
The Bottom Line: The EEOC’s desire to pursue class-wide claims in court does not relieve it of its statutory obligation to investigate and conciliate them first if it is contemplating filing suit.