Equal Employment Opportunity Commission v. Bass Pro Outdoor World, L.L.C. ( 2016 )

Case: 15-20078 Document: 00513552434 Page: 1 Date Filed: 06/17/2016
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
United States Court of Appeals
Fifth Circuit
FILED
No. 15-20078 June 17, 2016
Lyle W. Cayce
EQUAL EMPLOYMENT OPPORTUNITY COMMISSION, Clerk
Plaintiff - Appellee
v.
BASS PRO OUTDOOR WORLD, L.L.C.; TRACKER MARINE RETAIL,
L.L.C.,
Defendants - Appellants
Appeal from the United States District Court
for the Southern District of Texas
Before HIGGINBOTHAM, SOUTHWICK, and HIGGINSON, Circuit Judges.
PATRICK E. HIGGINBOTHAM, Circuit Judge:
The Equal Employment Opportunity Commission sued Bass Pro under
Sections 706 and 707 of Title VII of the Civil Rights Act for damages and
equitable relief, claiming that it engaged in a practice of racially discriminatory
hiring. 1 Bass Pro moved for summary judgment, arguing that claims alleging
a “pattern or practice” of discrimination can be brought only for equitable relief
and only under Section 707 of the Civil Rights Act, adding that the EEOC did
not satisfy administrative prerequisites to suit. The district court disagreed,
allowing the litigation to proceed. Bass Pro filed this interlocutory appeal. We
1 “Bass Pro” refers to Bass Pro Outdoor World, LLC, and Tracker Marine, LLC, which
are wholly owned subsidiaries of Bass Pro Group, LLC.
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affirm.
I.
The EEOC is nestled within a statutory framework fundamental to this
case. We begin and end with the statutory language erecting this structure.
Congress enacted Title VII of the Civil Rights Act in 1964 to prohibit employers
from intentionally “fail[ing] or refus[ing] to hire . . . any individual . . . because
of . . . race, color, religion, sex, or national origin[.]” 2 Section 705(a) of the Act
“created a Commission to be known as the Equal Employment Opportunity
Commission,” governed by bipartisan Commissioners “appointed by the
President by and with the advice and consent of the Senate.” 3 The EEOC’s
original powers of enforcement in Section 706 did not include the power to sue;
it could “make an investigation of” charges of discrimination filed by
individuals and use informal methods of “conference, conciliation, and
persuasion” to bring employers into compliance with Title VII. 4 If these efforts
failed, the Act authorized private suits, not by the EEOC, but “by the person
claiming to be aggrieved or . . . by any person whom the charge alleges was
aggrieved by the alleged unlawful employment practice.” 5
At the same time, in a separate provision, Section 707, Congress
authorized the Attorney General to file suit upon “reasonable cause to believe
that any person or group of persons is engaged in a pattern or practice of
resistance to the full enjoyment of any of the rights secured by [Title VII].” 6 In
2 Civil Rights Act of 1964, Pub. L. No. 88-352, 78 Stat. 255 (codified as amended at 42
U.S.C. § 2000e-2(a)(1) (“Section 703”)).
3 Id., 78 Stat. 258 (codified as amended at 42 U.S.C. § 2000e-5(a) (“Section 706(a)”)).
4 Id., 78 Stat. 258-59 (codified as amended at 42 U.S.C. § 2000e-4(a)-(b) (“Section
705(a)-(b)”)).
5 Id., 78 Stat. 260 (codified as amended at 42 U.S.C. § 2000e-5(f)(1) (“Section 706(e)”)).
6 Id., 78 Stat. 261 (codified as amended at 42 U.S.C. § 2000e-6(a) (“Section 707(a)”)).
Congress did “not intend[]” to use the phrase “pattern or practice” as a “term of art.” Int’l
Bhd. of Teamsters v. United States, 431 U.S. 324 n.16 (1977). “Pattern or practice” can
sometimes connote a certain kind of method of proof or litigation strategy. Like Congress,
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enacting Section 707, Congress intended to “provide the government with a
swift and effective weapon to vindicate the broad public interest in eliminating
unlawful practices, at a level which may or may not address the grievances of
particular individuals.” 7 To expedite these suits, Congress did not provide
private individuals with the “unconditional” right to intervene in suits brought
pursuant to Section 707. 8 Between 1964 and 1972, the Attorney General filed
“numerous” pattern or practice suits pursuant to this authority. 9
Over those eight years, “Congress became convinced . . . that the ‘failure
to grant the EEOC meaningful enforcement powers [had proved] to be a major
flaw in the operation of Title VII.’” 10 In 1972, Congress gave the EEOC the
power to bring two kinds of suits against private employers alleged to have
violated Title VII. 11 First, “[i]f . . . the Commission [is] unable to secure from
the respondent a conciliation agreement acceptable to the Commission [under
Section 706] the Commission may bring a civil action against the
respondent.” 12 An aggrieved individual cannot bring his own claim after the
EEOC files one, but retains the right to intervene. 13 Second, “[e]ffective two
years after the date of enactment,” Congress transferred the Attorney
General’s power to bring pattern or practice suits under Section 707 to the
this court uses the phrase only to refer its “usual meaning” – systemic discrimination that
has a broad impact across an industry, and not to a method of proof. See id., citing 110 Cong.
Rec. 14270 (1964).
7 United States v. Allegheny-Ludlum Indus., Inc., 517 F.2d 826, 843 (5th Cir. 1975).
8 Id.; 42 U.S.C. § 2000e-6.
9 118 Cong. Rec. 4080 (1972) (remarks of Sen. Williams); see, e.g., United States v.
Jacksonville Terminal Co., 451 F.2d 418 (5th Cir. 1971) (suit filed by Attorney General under
Section 707 alleging pattern or practice of discrimination); U.S. by Clark v. Dillon Supply
Co., 429 F.2d 800 (4th Cir. 1970) (same).
10 Gen. Tel. Co. of the Nw. v. Equal Employment Opportunity Comm’n, 446 U.S. 318,
325 (1980) (quoting S. Rep. No. 92-415, p. 4 (1971)).
11 Id. at 325-26.
12 Civil Rights Act of 1972, Pub. L. No. 92-261, 86 Stat. 105 (codified as amended at
42 U.S.C. § 2000e-5(f)(1) (“Section 706(f)(1)”)).
13 42 U.S.C. § 2000e-5(f)(1).
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EEOC. 14
In 1991, Congress further amended Title VII to allow “the complaining
party under Section 706 . . .[to] recover compensatory and punitive damages.” 15
Congress defined “[t]he term ‘complaining party’” as “the Equal Employment
Opportunity Commission, the Attorney General, or a person who may bring an
action or proceeding under title VII . . . .” 16 The 1991 Amendments were
intended “to strengthen existing protections and remedies available under
federal civil rights laws to provide more effective deterrence and adequate
compensation for victims of discrimination.” 17 Congress recognized that 42
U.S.C. § 1981 had long provided these remedies to victims of intentional racial
discrimination, but that Title VII did not provide them. 18 Permitting
compensatory and punitive damages under Title VII would close this “serious
gap.” 19 In cases where the “complaining party” sought such damages, Congress
provided that “any party may demand a trial by jury” 20 in order “[t]o protect
the rights of all persons under the Seventh Amendment.” 21
Congress limited these expanded remedies to cases of intentional
discrimination. 22 In other words, proof that an employment practice had a
“disparate impact” is not enough; plaintiffs seeking compensatory or punitive
damages, including the EEOC, must prove that the employers intended to
14 Id., 86 Stat. 107 (codified as amended at 42 U.S.C. § 2000e-6(c) (“Section 707(c)”));
see also 118 Cong. Rec. 4081 (1972) (remarks of Sen. Javits) (“The EEOC . . . has the authority
to institute exactly the same actions that the Department of Justice does under pattern or
practice.”).
15 Civil Rights Acts of 1991, Pub. L. No. 102-166, 105 Stat. 1071 (codified at 42 U.S.C.
§ 1981a(a)(1)).
16 42 U.S.C. § 1981a(d)(1).
17 H.R. Rep. No. 102-40 at 1 (1991), reprinted in 1991 U.S.C.C.A.N. 694, 694.
18 Id. at 3, reprinted in id. at 695-96.
19 Id. at 24, reprinted in id at 717.
20 Civil Rights Acts of 1991, Pub. L. No. 102-166, 105 Stat. 1071 (codified at 42 U.S.C.
§ 1981a(a)(1)).
21 H.R. Rep. P. No. 102-40 at 29 (1991), reprinted in 1991 U.S.C.C.A.N. 694, 723.
22 42 U.S.C. § 1981a(a)(1).
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discriminate by engaging in a certain practice or act. 23 Further, punitive
damages are not available unless the plaintiff can “demonstrate[] that the
[employer] engaged in a discriminatory practice . . . with malice or with
reckless indifference to the federally protected rights of an aggrieved
individual.” 24 In short, Congress explicitly authorized the EEOC to sue, and
upon proof of intentional discrimination, to recover compensatory and
sometimes punitive damages.
II.
Title VII suits are often tried to courts under the Teamsters framework. 25
In International Brotherhood of Teamsters v. United States, the Supreme Court
determined that when “a class . . . allege[s] a broad-based policy of employment
discrimination,” the class may pursue its pattern or practice claims in a
bifurcated proceeding. 26 In its first stage, plaintiffs must establish “that
unlawful discrimination has been a regular procedure . . . followed by an
employer.” 27 “[S]ingle, insignificant, isolated acts of discrimination” are not
enough to prove a pattern or practice; nor are “sporadic incident[s].” 28 Instead,
23 Id.
24 Id. § 1981a(b)(1).
25 The Teamsters bifurcated model of proof is an alternative to the McDonnell Douglas
model. See Int’l Bhd. Of Teamsters v. United States, 431 U.S. 324, 358 (1977) (rejecting the
argument that McDonnell Douglas is “the only means of establishing a prima facie case of
individual discrimination”). Under McDonnell Douglas, the plaintiff can establish a prima
facie case by presenting evidence that he or she (1) is a member of a protected class; (2) is
qualified for the job; (3) suffered an adverse employment decision; and (4) was treated
differently than similarly-situated non-protected employees. McDonnell Douglas Corp. v.
Green, 411 U.S. 792 (1973).
26 431 U.S. at 359, 360 n.46. The Teamsters Court relied on Franks v. Bowman
Transportation Co., 424 U.S. 747 (1976), a Section 706 class action case. Teamsters, 431 U.S.
at 358-60. In Franks, the Court said the district court erred in requiring class members to
individually prove discrimination where they had already shown “the existence of a
discriminatory . . . pattern and practice.” Franks, 424 U.S. at 772. The Court in Teamsters
said Franks “illustrates another means by which a Title VII plaintiff’s initial burden of proof
can be met.” Teamsters, 431 U.S. at 359.
27 Id. at 360.
28 Id. at 336 n.16 (quoting 110 Cong. Rec. 14270 (1964) (remarks of Sen. Humphrey)).
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plaintiffs must show that the “denial of rights” was “repeated, routine, or of a
generalized nature,” 29 and that “discrimination was the company’s standard
operating procedure.” 30
If the plaintiff meets its initial burden of proving a pattern or practice, a
subsequent remedial phase determines “the scope of individual relief.” 31
During these proceedings, it is assumed “that any particular employment
decision [made while] the discriminatory policy was in force[] was made in
pursuit of that policy.” 32 “The [plaintiff] need only show that [he] . . .
unsuccessfully applied for a job” to prove a prima facie case, and the burden
then shifts to “the employer to demonstrate that the . . . applicant was
denied . . . for lawful reasons.” 33
Although the Teamsters pattern or practice method of proof is often used
in class actions, the EEOC is not required to adhere to Rule 23 when bringing
“an enforcement action . . . in its own name.” 34 In General Telephone, the
Supreme Court observed that the prerequisites to class certification under
Rule 23 – “numerosity, commonality, typicality, and adequacy of
representation” 35 – would inhibit the EEOC’s ability to “proceed in a unified
action” bringing all available claims. 36 Congress intended to endow the EEOC
with broad enforcement authority outside the confines of Rule 23 because
“[w]hen the EEOC acts, albeit at the behest of and for the benefit of specific
29 Id.30 Id. at 336.
31 Id. at 361.
32 Id. at 362.
33 Id.34 446 U.S. at 323, 327 n.10 (1980) (“Since 1972, backpay has also been awarded in
pattern-or-practice suits, and without suggestion that Rule 23 is implicated.”). Nor was the
Attorney General required to adhere to Rule 23 when he brought pattern or practice suits,
before Congress transferred this authority to the EEOC, “even though specific relief was
awarded to individuals not parties to the suit.” Id. at 327.
35 Id. at 330; see Fed. R. Civ. P. 23(a).
36 Gen. Tel., 446 U.S. at 331.
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individuals, it acts also to vindicate the public interest in preventing
employment discrimination.” 37
III.
This case began in February 2007, when the EEOC issued a
Commissioner’s Charge stating that there was “reason to think” Bass Pro
“ha[d] since at least November 2005[] discriminated against African American
applicants and employees on the basis of their race at . . . retail stores and
facilities nationwide.” In an amended charge, the EEOC expanded its
allegations to include Hispanic applicants and employees, alleging that Bass
Pro “fail[ed] to recruit and/or hire” racial minorities “for all positions in its
retail stores.” 38 The EEOC’s investigation commenced shortly thereafter.
In April 2010, the EEOC issued a Letter of Determination providing that
it had “good cause” to believe that the allegations in the amended charge were
true and began the conciliation process. During conciliation, the EEOC told
Bass Pro that it had identified an estimated 100 individuals who were victims
of discriminatory hiring, but it did not provide specific names. The parties
exchanged several letters and met in person once, but made little headway.
The EEOC finally declared conciliation unsuccessful in April 2011.
In September 2011, the EEOC filed this lawsuit under 42 U.S.C. § 2000e-
5 (“Section 706”) and § 2000e-6 (“Section 707”), alleging a pattern or practice
of discriminatory hiring against African American and Hispanic applicants.
37 Id. at 326.
38 The amended charge also included allegations that Bass Pro discriminated against
female and Asian applicants, failed to promote employees on the basis of race and gender,
retaliated against employees who opposed discriminatory practices, and treated minority
employees adversely. Id. Following the conciliation and investigation process, the EEOC
limited its lawsuit to claims that Bass Pro (1) engaged in a discriminatory hiring practice
impacting African American and Hispanic applicants, and (2) retaliated against employees
who opposed discrimination. The district court denied summary judgment as to the
retaliation claims, a decision which Bass Pro did not appeal.
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The EEOC intended to proceed under the Teamsters framework, and it did not
identify aggrieved individuals. Bass Pro moved to dismiss, arguing, inter alia,
that the EEOC may not bring a pattern or practice claim under Section 706,
and that the EEOC may not use the Teamsters bifurcated framework to prove
a Section 706 claim. The district court agreed and granted the motion.
In response, the EEOC filed a second amended complaint, which
included the names of more than 200 African American and Hispanic
aggrieved individuals. The EEOC said they were “exemplars of a pattern or
practice of discrimination.” Bass Pro moved for summary judgment, arguing
that the EEOC failed to satisfy the administrative prerequisites for a Section
706 suit because none of the claims of the individuals were investigated or
disclosed during the administrative process. The district court granted the
motion in part, holding that the claims of the recently disclosed individuals
could not proceed.
In June 2014, Bass Pro renewed its motion for summary judgment. In
response, the EEOC asked the district court to reconsider its ruling rejecting
its Section 706 pattern or practice claim. The district court reversed its
previous decision, now persuaded that the EEOC could proceed within the
Teamsters framework in its effort to prove a pattern or practice claim under
Section 706. 39 The court also found that the EEOC fulfilled the administrative
prerequisites to filing suit. Pursuant to 28 U.S.C. § 1292(b), we granted Bass
Pro leave to appeal from the district court’s order.
IV.
A.
39 The district court was persuaded in part by the Sixth Circuit’s then-recent decision
in Serrano v. Cintas Corp., 699 F.3d 884 (6th Cir. 2012), cert. denied sub nom. Cintas Corp.
v. EEOC, 134 S. Ct. 92 (2013), which addressed “the exact question posed here.” Id. Cintas
held that the EEOC could use the Teamsters framework for analyzing pattern or practice
claims of employment discrimination. 699 F.3d at 894.
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Bass Pro correctly notes that, unlike Section 707, Section 706 does not
explicitly authorize pattern or practice suits. 40 It argues that by limiting its
reach to actions under Section 706, Congress intended to maintain a basic
dichotomy between suits under Section 707, where remedial relief may be had,
with Section 706, with its focus upon individual acts of discrimination and
money damages. The EEOC replies in part by pointing to relevant Supreme
Court precedent suggesting that the want of pattern or practice language in
Section 706 does not forbid its use in suits by the EEOC under Section 706.
In General Telephone, the EEOC alleged a pattern of discrimination
against women employed by General Telephone and brought suit on behalf of
“women affected by the challenged practices” pursuant to Section 706. 41 It
sought “an order bifurcating the issue of class liability from the issue of
individual damages.” 42 General Telephone argued that the suit was a Rule 23
class action that did not meet the demands of Rule 23. 43
Rejecting this argument, the Court held that the EEOC “may maintain
its Section 706 civil actions for the enforcement of Title VII and may seek
specific relief for a group of aggrieved individuals without first obtaining class
certification pursuant to [Rule 23].” 44 In so holding, the Court observed that
“the EEOC need look no further than § 706 for its authority to bring suit in its
40 Compare 42 U.S.C. § 2000e-5(b), (f)(1) (§ 706) (“Whenever a charge is filed by or on
behalf of a person claiming to be aggrieved” and “the Commission determines after [its]
investigation that there is reasonable cause to believe that the charge is true, the Commission
shall endeavor to eliminate any such alleged unlawful employment practice by informal
methods of conference, conciliation, and persuasion.” If “the Commission has been unable to
secure from the respondent a conciliation agreement acceptable to the Commission, the
Commission may bring a civil action against” the respondent.), with 42 U.S.C. § 2000e-6(a),
(e) (§ 707) (the Commission may “bring a civil action” against a private entity when it “has
reasonable cause to believe that any person or group of persons is engaged in a pattern or
practice of resistance to the full enjoyment of any of the rights secured by this subchapter.”).
41 Gen. Tel., 446 U.S. at 321 (1980).
42 Id. at 321-22.
43 Id. at 322.
44 Id. at 333-34.
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own name for the purpose, among others, of securing relief for a group of
aggrieved individuals.” 45 Congress had given the EEOC “broad enforcement
powers” 46 “to advance the public interest in preventing and remedying
employment discrimination.” 47 The Court was therefore “reluctant, absent
clear congressional guidance, to subject § 706(f)(1) actions to requirements that
might disable the enforcement agency from advancing the public interest in
the manner and to the extent contemplated by the statute.” 48
We heed the Court’s reluctance. Bass Pro argues that General Telephone
does not compel us to affirm because it was decided before the Civil Rights Act
of 1991. 49 But “Congress is presumed to be aware of [the] . . . judicial
interpretation” of a statute and “to adopt that interpretation” when it re-enacts
it without changing the relevant provision. 50 The Supreme Court and courts of
appeals have observed that Congress was indeed aware of General Telephone
when it expanded the remedies available under Section 706. 51 Moreover, the
45 Id. at 324.
46 Id. at 333.
47 Id. at 331.
48 Id.
49 Bass Pro also argues that allowing pattern or practice suits under Section 706
renders Section 707 functionally superfluous, in violation of the “longstanding canon of
statutory construction that terms in a statute should not be considered so as to render any
provision of that statute meaningless or superfluous.” Beck v. Prupis, 529 U.S. 494, 506
(2000). The Sixth Circuit called the superfluity argument the “strongest argument” against
its holding in Cintas, 699 F.3d 884. In highlighting the differences between Section 706 and
707, the court pointed to case law suggesting that suits under Section 706 necessarily
stemmed from charges filed by “an aggrieved individual” while those under Section 707 could
be raised by the EEOC of its own accord. Id. at 896. Because the initiating charge under
Section 706 may be filed by an EEOC Commissioner, rather than a private party – as it was
in this case – we do not find this difference significant. However, this is not the sole difference
between the two sections. For instance, private individuals have the right to intervene in 706
actions, but not under 707. See § 706(f)(1). The EEOC also has access to trial by a three-judge
panel when it proceeds under 707, but not under 706. See § 707(b).
50 Lorillard v. Pons, 434 U.S. 575, 580 (1978); see also Silva-Trevino v. Holder, 742
F.3d 197, 202 (5th Cir. 2014) (quoting and applying Lorillard).
51 See EEOC v. Waffle House, 534 U.S. 279, 288 (2002) (“Against the backdrop of our
decision[ ] in . . . General Telephone, Congress expanded the remedies available in EEOC
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Supreme Court recently repeated its General Telephone holding in CRST Van
Expedited, Inc. v. EEOC. 52
We conclude that Congress did not prohibit the EEOC from bringing
pattern or practice suits under Section 706 and, in turn, from carrying them to
trial with sequential determinations of liability and damages in a bifurcated
framework. Bifurcation of liability and damage is a common tool deployed by
federal district courts in a wide range of civil cases – well within its powers
under Rules 16 and 26. 53 We decline to imply limits upon the trial court’s
management power that not only cannot be located in the language of the
statute but also confound the plain language of the Federal Rules.
B.
Bass Pro next asserts that the Teamsters model for proving pattern or
practice claims would here be unconstitutional, offending both due process and
the Seventh Amendment. The EEOC has informed Bass Pro that the injured
prospective employees could include thousands of individuals. Bass Pro argues
that each of these individuals were damaged, if at all, in varying degrees by its
allegedly discriminatory hiring. And if it were to be found liable in the first
stage of litigation, Bass Pro urges, the resulting exposure to damages would
compel settlement, a functional loss of the opportunity to present distinct
defenses to damages against each aggrieved person. Bass Pro characterizes this
pressure to settle as a deprivation of its due process rights. But pattern or
enforcement actions in 1991 to include compensatory and punitive damages.”); In re Bemis
Co., 279 F.3d 419, 421-22 (7th Cir. 2002) (availability of damages after 1991 Act does not
alter “the validity or scope of General Telephone”); EEOC v. Dinuba Med. Clinic, 222 F.3d
580, 588 (9th Cir. 2000) (same). Additionally, to characterize the 1991 Act as limiting
methods of proof previously available in a § 706 case is also contrary to that statute’s stated
purpose to provide “additional remedies . . . needed to deter . . . intentional discrimination in
the workplace.” Civil Rights Act of 1991, Pub. L. No. 102-166, § 2(1), 105 Stat. 1071 (emphasis
added).
52 136 S. Ct. 1642, 1648 (2016).
53 See Fed. R. Civ. P. 16, 26.
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practice suits characteristically involve allegations of discrimination on a large
scale – and the pressure to settle that attends such extensive litigation –
whether they are brought under Section 706 or Section 707. The pressure
remains a concern in the cost/benefit analysis inherent in settlement decisions,
but necessary risks do not offend due process as long as the risk enhancements
flow from structures that do not themselves offend due process.
Further, Bass Pro’s argument about risk ignores the other side of the
risk; not all of the incentives under Teamsters work in the EEOC’s favor.
Indeed,
under Teamsters, the plaintiff’s initial burden to make out a prima
facie case is heightened. Unlike under the McDonnell Douglas
framework . . . under Teamsters the plaintiff must demonstrate the
existence of a discriminatory procedure or policy. This is no simple
task, as the plaintiff must prove that discrimination was the
company’s standard operating procedure—the regular rather than
the unusual practice. It is only because this initial requirement is
more arduous that after the showing is made it is assumed that any
particular employment decision, during the period in which the
discriminatory policy was in force, was made in pursuit of that
policy. Even then, the defendant still may rebut the assumption by
providing lawful reasons for the employment decision. 54
As a result of this heightened burden, “the EEOC must always weigh the
risks — as well as the benefits — of proceeding under the Teamsters framework,
including a higher risk of losing at the prima facie stage.” 55 If the EEOC fails
to create a genuine dispute of material fact as to the existence of a pattern or
practice of discrimination, Bass Pro has recourse to Rule 56. 56
54 Serrano v. Cintas Corp., 699 F.3d 884, 896 (6th Cir. 2012) (internal citations and
quotations omitted).
55 Id.56 See Fed. R. Civ. P. 56(a) (“A party may move for summary judgment, identifying
each claim or defense — or the part of each claim or defense — on which summary judgment
is sought. The court shall grant summary judgment if the movant shows that there is no
genuine dispute as to any material fact and the movant is entitled to judgment as a matter
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Bass Pro also points to Wal-Mart Stores, Inc. v. Dukes 57 for the
proposition that a formulaic approach to individual liability and damages
denies due process. Wal-Mart did hold that “trial by formula” is a denial of due
process. 58 However, the Court distinguished “trial by formula” from the
Teamsters approach, which it cited as the established procedure for trying
pattern or practice claims. 59 This precedent is unchanged by the number of
potentially aggrieved individuals.
Relatedly, Bass Pro argues that the Teamsters model has inherent
manageability problems, such as the Seventh Amendment’s bar to
reexamination by a second jury of factual issues decided by the first jury. 60 It
asserts that some issues of liability and damage are inherently inseparable,
such as the degree to which a given manager was acting with malice, which
may be relevant to liability and calculation of punitive damages. 61
We do not see these difficulties as fanciful. Neither did the district
court. 62 But as the district court noted, the complexities of this case do not
of law.”). To survive summary judgment, the EEOC will need to allege more than isolated
wrongful acts by errant employees; it must allege “a broad-based policy of employment
discrimination.” Teamsters, 431 U.S. at 359.
57 564 U.S. 338, 364-66 (2011).
58 Id. at 367.
59 Id.60 See Castano v. Am. Tobacco Co., 84 F.3d 734, 750 (5th Cir. 1996) (holding that the
Seventh Amendment guarantees “parties [that] . . . fact issues decided by one jury” will not
be reexamined by a second jury and that the “Constitution [only] allows bifurcation of issues
that are so separable that the second jury will not be called upon to reconsider findings of
fact by the first[.]”).
61 See Allison v. Citgo Petroleum Corp., 151 F.3d 402, 410 (5th Cir. 1998) (observing
that the expansion of remedies available to Title VII plaintiffs “introduced . . . potential
manageability problems with both practical and legal, indeed constitutional, implications”
and “increased the probability that successive juries would pass on issues decided by prior
ones”). But the Allison plaintiffs were private individuals seeking class certification under
Rule 23. In this case, of course, the plaintiff is the EEOC, unbounded by Rule 23’s procedural
requirements. Gen. Tel., 446 U.S. at 324.
62 The court noted that there is tension “between ensuring manageability and
respecting the Seventh Amendment.”
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make it “categorically impossible to apply the Teamsters framework to a § 706
action.” 63 Bass Pro slights the management tools at the hand of the district
court.
Indeed, nigh routine use of the tools afforded by the Federal Rules of
Civil Procedure provide practical answers to Bass Pro’s suggestion that with
bifurcation, punitive damage liability may offend the Seventh Amendment.
Bass Pro reminds that to be liable for punitive damages, the EEOC must
demonstrate that it “engaged in a discriminatory practice . . . with malice or
with reckless indifference to the federally protected rights of an aggrieved
individual.” 64 This is so. However, during the first stage of the Teamsters
litigation, the district court may employ Rule 49 to structure the jury’s findings
of fact. 65 First, the court can ask if the jury finds that the EEOC has proved
from a preponderance of the evidence that Bass Pro engaged in a pattern or
practice of discriminatory hiring. Then, if and only if the jury answers in the
affirmative, the jury would answer a second question, whether the EEOC has
proved from a preponderance of the evidence that Bass Pro engaged in the
practice with the requisite “malice or reckless indifference.” 66 With a finding
that the earlier found pattern or practice was the product of malice or reckless
indifference, individuals in phase two would need to show injury suffered from
the pattern or practice to share in any award of punitive damages. 67 This
63Id.
6442 U.S.C. § 1981a(b)(1).
65 See Fed. R. Civ. P. 49(b) (“The court may submit to the jury forms for a general
verdict, together with written questions on one or more issues of fact that the jury must
decide.”).
66 42 U.S.C. § 1981a(b)(1).
67 We do not here review any one method of calculating punitive damages. Several
possible paths may present in pre-trial proceedings, including opportunities for agreement
upon procedures that are in the best interests of all parties. There are incentives for parties
– reducing exposure and easing administrative burdens – to agree. For example, limiting
punitive damages to some multiplier bearing relationship to found damages. See BMW of N.
Am., Inc. v. Gore, 517 U.S. 559, 580 (1996) (“The principle that exemplary damages must bear
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system avoids the risk that a second jury would reconsider the first finding of
fact or award damages for aberrational conduct of a single actor or other
conduct sporadically occurring outside the found pattern.
The EEOC’s pursuit of compensatory damages may prove more difficult
to administer. The 1991 Amendments provided that “complaining parties” –
including the EEOC 68 – may seek “future pecuniary losses, emotional pain,
suffering, inconvenience, mental anguish, loss of enjoyment of life, and other
nonpecuniary losses” in cases of intentional discrimination. 69 While bifurcation
under Teamsters may struggle here to slice liability and damage, it signifies
that the EEOC can proceed with a pattern or practice suit and pursue all the
damages Congress authorized subject to manageability as shadowed by due
process and the Seventh Amendment. As these constraints take hold in the
pretrial process, the EEOC may conclude that its obligation to enforce Title VII
is best discharged by not pursuing in this hiring case the relatively nuanced
and elusive compensatory damages. At the same time, Bass Pro may decide
that its interests are best served by moderating any exposure it may face by
constructing workable management processes it would not otherwise be
compelled to abide. The full bite of these constraints is not a decision that this
court, remote from engagement and effectual record, ought now make.
The administration of this litigation is a challenge, but one best left for
the able district court. As we have respectfully maintained, district courts have
a ‘reasonable relationship’ to compensatory damages has a long pedigree.” (citations
omitted)). Such self-interested accords might, by way of example only, provide that if the jury
finds in the liability stage that Bass Pro engaged in a pattern or practice of discrimination
with the requisite intent to warrant punitive damages, than an individual awarded damages
in the second stage could recover a punitive award not to exceed three times the damages
awarded to that individual. Of course Congress has limited the amount of compensatory and
punitive damages to a maximum of $300,000 or less, apparently to each claimant, according
to the defendant’s corporate size. 42 U.S.C. § 1981a(b)(3).
68 42 U.S.C. § 1981a(d)(1).
69 42 U.S.C. § 1981a(b)(3).
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the “inherent power to manage . . . pending litigation,” applying their
experience and knowledge of the case at hand. 70 It is the district court – with
the flexibility afforded to it by the Rules of Civil Procedure, here prominent
Rule 49 – that is in the best position to fulfill the task of enforcing the
Congressional charge to protect the rights of employees.
V.
Finally, Bass Pro alleges that the district court erred in allowing the
EEOC to proceed without fulfilling mandatory administrative prerequisites
under Section 706. Before filing a lawsuit under Section 706, the EEOC must:
(1) receive a charge; (2) provide notice of the charge to the employer; (3)
investigate the charge; (4) notify the employer if the investigation gives rise to
reasonable cause to suspect a violation has occurred; and (5) attempt to
conciliate the dispute. 71 These prerequisites are part of the “integrated,
multistep enforcement procedure” 72 of Title VII, serving its “primary purpose”
of voluntary compliance without litigation. 73
Bass Pro argued to the district court that the EEOC’s failure to name
specific aggrieved individuals – and to investigate and conciliate their
individual claims – failed the administrative tests of Section 706. On appeal,
the parties dispute whether the EEOC in fact named any aggrieved
individuals, 74 a factual question that the district court did not resolve. Instead,
it concluded that the EEOC may engage in the investigation and conciliation
70 Allison, 151 F.3d at 408.
71 42 U.S.C. § 2000e-5(b).
72 Occidental Life Ins. Co. of Cal. v. EEOC, 432 U.S. 355, 359 (1977).
73 Pacheco v. Mineta, 448 F.3d 783, 788 (5th Cir. 2006); accord McClain v. Lufkin
Indus., Inc., 519 F.3d 264, 273 (5th Cir. 2008).
74 The EEOC appears to have told Bass Pro about 100 alleged victims during a
conciliation meeting in August 2010, but did not provide any of their names until after the
litigation began.
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process without naming specific victims, although the court considered the
issue “a difficult question.”
The Supreme Court has since considered “whether and to what
extent . . . an attempt to conciliate is subject to judicial consideration,” holding
in Mach Mining that judicial review of the EEOC’s conciliation efforts is
“barebones.” 75 Our review is limited to verifying (1) that the Commission has
informed the employer about the specific allegation, including “what the
employer has done and which employees (or what class of employees) have
suffered as a result,” and (2) that the Commission has “tr[ied] to engage the
employer in some form of discussion (whether written or oral), so as to give the
employer an opportunity to remedy the allegedly discriminatory practice.” 76
Such review, reasoned the Court, “respects the expansive discretion that Title
VII gives to the EEOC over the conciliation process.” 77
On appeal, Bass Pro argues that Mach Mining is inapplicable. According
to Bass Pro, the EEOC’s conciliation efforts addressed only its claims of a
pattern or practice of discrimination, not individual claims of discrimination as
it argues Section 706 requires. That is, Bass Pro frames its argument not as a
challenge to the sufficiency of the EEOC’s conciliation efforts, which Mach
Mining appears to foreclose, but rather a challenge to whether the EEOC
conducted any conciliation with respect to its Section 706 claims. In support of
this position, Bass Pro points us to the Eighth Circuit’s decision in EEOC v.
CRST Van Expedited, Inc., 78 in which the court affirmed the dismissal of claims
brought by certain individuals because the EEOC had failed to identify them to
the defendants during the investigation and conciliation stages. But the court
75 Mach Mining, LLC v. EEOC, 135 S. Ct. 1645, 1651, 1656 (2015).
76 Id. at 1655-56.
77 Id. at 1653.
78 679 F.3d 657 (8th Cir. 2012).
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explicitly noted that the EEOC was not bringing a pattern or practice suit, and
the court “express[ed] no view as to whether the EEOC’s investigation . . .
would be sufficient to support” such a claim. 79 Moreover, in deeming the EEOC’s
conciliation efforts insufficient, the CRST court engaged in precisely the kind
of “deep dive” the Court prohibited in Mach Mining. 80
Since Mach Mining, only one court of appeals has considered the
question before us; that is, whether the EEOC can meet its conciliation and
investigation requirements without naming individual class members. In
Arizona ex rel. Horne v. Geo Group, Inc., the Ninth Circuit concluded that it
could. 81 The court “reject[ed] the [] premise that the EEOC . . . must identify
and conciliate on behalf of each individual aggrieved employee . . . prior to filing
a lawsuit seeking recovery on behalf of a class.” 82 It held that instead, the EEOC
“satisf[ies] [its] pre-suit conciliation requirements to bring a class action if [it]
attempt[s] to conciliate on behalf of an identified class of individuals prior to
bringing suit.” 83 The court reasoned that this holding was “consistent with the
Supreme Court’s broad interpretation of the EEOC’s enforcement powers.” 84
We similarly hold that the conciliation here satisfied the Mach Mining
standard. Efforts began in April 2010, when the EEOC informed Bass Pro that
79 Id. at 676 n.13.
80 135 S. Ct. at 1653.
81 816 F.3d 1189 (9th Cir. 2016).
82 Id. at 1200.
83 Id. The facts of Geo are somewhat different than those we are presently considering.
The EEOC informed Geo of the names of small number of individual claimants during the
conciliation process, although it withheld the names of most of the allegedly aggrieved
individuals. Id. Here, the record does not clearly show that the EEOC named any individuals.
Further, as Bass Pro points out, the Ninth Circuit explicitly declined to “consider whether
the EEOC could maintain a nationwide class action against an employer based on an
investigation of less than a dozen employees or whether such an investigation would be
reasonable.” Id. at 1200 n.6. But we find no basis in Mach Mining – nor in the reasoning of
Geo itself – for treating this case differently on the basis of the scope of the claims against
the employer.
84 Id. at 1201.
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it had reasonable cause to believe that Bass Pro had engaged in discriminatory
practices. Even if the EEOC did not initially provide the names of specific
victims, it informed Bass Pro about the class it had allegedly discriminated
against – African American, Hispanic, and Asian applicants. The parties
negotiated for eleven months, via letters and face-to-face meetings about the
charges. These efforts clearly put Bass Pro on notice as to the claims against it.
Further, Bass Pro’s argument that the EEOC never engaged in any conciliation
of its Section 706 claims assumes that the EEOC’s Section 706 claims are
distinct from its pattern or practice claims. Since we hold that Section 706
authorizes the EEOC to claim a pattern or practice of discrimination,
conciliation efforts for its pattern or practice claims are one and the same as its
Section 706 conciliation efforts. Under Mach Mining, those efforts were
sufficient.
Bass Pro makes a similar argument regarding the EEOC’s pre-suit
investigation. It claims that, by relying on statistical and anecdotal evidence
rather than evidence about specific aggrieved individuals, the EEOC neglected
its duty to investigate its Section 706 claims. Like Bass Pro’s argument that the
EEOC failed to conciliate, its argument concerning failure to investigate
wrongly assumes that an investigation under Section 706 necessarily rests on
the identifiable individuals’ claims.
Because the EEOC’s Section 706 claim is a pattern or practice suit, our
review of its investigation is limited. Title VII “does not prescribe the manner”
by which the EEOC investigates, and “the nature and extent of an EEOC
investigation into a discrimination claim is a matter within the discretion of
that agency.” 85 The record shows that the EEOC investigated its pattern or
85 Newsome v. EEOC, 301 F.3d 227, 231 (5th Cir. 2002) (per curiam); see also EEOC
v. Sterling Jewelers Inc., 801 F.3d 96, 191 (2d Cir. 2015) (“[C]ourts may not review the
sufficiency of an investigation — only whether an investigation occurred.”).
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practice charge against Bass Pro and that the investigation gave “rise to
reasonable cause to suspect a violation.” 86 Over a three year period, “the parties
exchanged numerous letters, met at least three times,” and Bass Pro “produced
over 230,000 pages of documents.” The investigation yielded statistical evidence
of discrimination in Bass Pro’s hiring nationwide, as well as anecdotal evidence
of racial discrimination. This investigation meets the EEOC’s statutory burden.
Since the EEOC is authorized to bring a pattern or practice suit under
Section 706, the fact that it focused on pattern or practice evidence instead of
individual claims during the investigation and conciliation process is of no
consequence. Our review is only to determine whether the EEOC engaged in
these steps, which it did.
VI.
Bass Pro has asked us to conclude that Sections 706 and 707 of Title VII
offer dichotomous paths, with money damages available in the trial of
individual actions under Section 706, leaving the aggregation of the claims of
individuals injured by a pattern or practice to Section 707, with its limit of
equitable remedies of injunctive and back pay relief. Perhaps this is sound
policy. It has been well stated by able lawyers, but the plain language of the
statute cannot yield to such adversarial persuasion. We decline to undo the
structure erected by Congress in the guise of interpretation seduced by
judicially preferred policy choices.
AFFIRMED.
86 42 U.S.C. § 2000e-5(b).
20