U.S. Supreme Court Issues Decisions In Three Employment-Related Cases

Volume 15, Issue 9
June 1, 2016

Spokeo, Inc. v. Robins - May 16, 2016

This is a Fair Credit Reporting Act case we discussed late last year that may have far-reaching consequences for employers because the plaintiff is seeking the right to file a lawsuit over a mere technical violation of a statute, without showing that he suffered actual harm.  A ruling that permits such a result may lead to an increase in lawsuits against employers under a variety of statutes.

The plaintiff, Thomas Robins, alleged that false background information displayed by Spokeo, Inc. about him on the Internet violated his rights under the Fair Credit Reporting Act. He filed a class-action lawsuit against Spokeo that the Ninth Circuit Court of Appeals, with jurisdiction over Nevada, allowed -- ruling that a violation of Robins' statutory rights was enough of an injury to allow the lawsuit to proceed.

The Supreme Court determined that the Ninth Circuit Court's analysis was incomplete and sent the case back for a more thorough consideration of "standing" - the constitutional doctrine that limits the category of litigants who can maintain a lawsuit in federal court to seek relief for a legal wrong. The Court explained that determining whether an actionable injury has occurred requires a consideration of two issues: did the plaintiff suffer "an invasion of a legally protected interest" that is (1) concrete and (2) particularized? "Particularization" requires that an injury "affect the plaintiff in a personal and individual way," while "concreteness" requires an injury to actually exist. The Supreme Court seemed to agree with Robins that a violation of a statutory right may create an actual injury but indicated that the determination must be governed by the intent of Congress in creating that statutory protection.

We will continue to keep you updated on the progress of this case.

CRST Van Expedited, Inc. v. Equal Employment Opportunity Commission - May 19, 2016

This case presented the issue of whether an employer was entitled to an award of over $4 million in attorney's fees and costs following the dismissal of a Title VII claim due to the EEOC's failure to satisfy its pre-litigation obligations.

In many lawsuits, the parties each pay their own attorney's fees and costs. Sometimes a court can shift fees, however, and require a party to pay the other party's fees. Title VII of the Civil Rights Act permits this type of fee shifting when one party is the "prevailing party."

In this class action sex discrimination case filed under Title VII, the court dismissed the claims of 67 plaintiffs due to the EEOC's failure to take the steps it is required to complete before filing a lawsuit against an employer - specifically, investigate the plaintiffs' charges of discrimination, determine whether there is reasonable cause to believe the charges are true, and attempt to remedy the discrimination informally with the employer. In dismissing the claims, the court also ordered the EEOC to pay the fees and costs the employer incurred in defending them.

However, the Eighth Circuit Court of Appeals disagreed. This appellate court determined that the employer was not a prevailing party because it had not won the case on the merits. Instead, it had won on a procedural violation. Accordingly, the Eighth Circuit Court determined that the employer was not a prevailing party under Title VII.

The U.S. Supreme Court disagreed and determined that the employer here was a prevailing party. The Court explained that "[c]ommon sense undermines the notion that a defendant cannot 'prevail' unless the relevant disposition is on the merits." A defendant prevails if it wins on the merits or for a nonmerits reason. Additionally, the Court found "no indication that Congress intended that defendants should be eligible to recover attorney's fees only when courts dispose of claims on the merits."

This decision is favorable for employers because it removes a potential limitation to an attorney's fees award when a Title VII case ends in their favor. It also serves as a caution to plaintiffs who rush into litigation without careful consideration. Importantly, this case should not be read as giving employers an automatic right to recover their attorneys' fees and costs when they prevail in an employment case. The legal standard for awarding fees/costs to a prevailing employer, particularly in cases brought under Title VII, remains very high for an employer to satisfy.

Green v. Brennan - May 23, 2016

Also discussed last year, this case involves the deadline for bringing a "constructive discharge" claim. Under the constructive discharge theory, an employee must show that his or her work environment was so intolerable (perhaps due to discrimination or harassment) that the employee was "forced" to quit. The issue here is when the time period for an employee to file a constructive discharge claim begins - the day the employee quits or upon the last act of discrimination/harassment by the employer that forces the employee to quit?

The Supreme Court held the limitations period for such constructive discharge claims begins running only after an employee resigns.

KZA Employer Report articles are for general information only; they are not intended and should not be construed to be legal advice. Reading or replying to such articles does not establish an attorney-client relationship. In addition, because the subject matters and applicable laws discussed in Employer Report articles are often in a state of change and not always applicable to every type of business entity or organization, readers should consult with counsel before making decisions based on the same.