Background
In McLane Co. Inc. v. EEOC, the U.S. Supreme Court reviewed a district court’s decision on whether to enforce a subpoena issued by the U.S. Equal Employment Opportunity Commission (EEOC). In McLane, a female employee, Damiana Ochoa filed a charge with the EEOC alleging sex discrimination (based on pregnancy) in violation of Title VII of the U.S. Civil Rights Act of 1964 (Title VII). Ochoa claimed that when she tried to return to her job following maternity leave, her employer (McLane Co.) informed her that she could not return to the position she had held for eight years as a cigarette selector, unless she passed a physical strength test. Ochoa’s job as a cigarette selector required her to lift, pack, and move large bins of products into the McLane Co. Distribution Center. McLane Co. had a company policy that required physical evaluations of all new hires and all employees returning from any leave lasting more than 30 days. Ochoa took the test three times but failed to pass and, as a result, she was fired.
As part of its investigation, the EEOC asked McLane Co. to provide them with information about the physical evaluation and individuals who had been asked to take it. Although McLane Co. willingly provided general information about the test and the individuals who had been required to take it, including gender, job class, reason for taking the test, and the score received, McLane Co. refused to disclose “pedigree information” for each test taker, including name, social security number, last known address, telephone number, and the reasons why particular employees were terminated after taking the test.
Case Outcome
After discovering that McLane Co. applied their physical evaluation policy nationwide, the EEOC broadened the scope of its investigation, both geographically and substantively. The EEOC requested McLane Co. provide information for all of the company’s locations nationwide. Additionally, the EEOC requested information beyond the original gender-related inquiries to encompass information relevant to potential age discrimination. However, McLane Co. failed to provide the “pedigree” information related to the EEOC’s expanded information request. As such, the EEOC issued subpoenas for the information. McLane Co. refused to comply with these subpoenas, so the EEOC sought enforcement in the federal district court. The district court declined to enforce the EEOC's subpoena seeking pedigree information. The district court reasoned that, even if the EEOC had the names of employees who took the physical evaluation, or an opportunity to interview them, the information would not help determine whether McLane Co.’s use of the physical evaluation was discriminatory.
The U.S. Court of Appeals for the Ninth Circuit reviewed the district court's decisions de novo and reversed. In rendering its opinion, the Ninth Circuit panel questioned, in a footnote, why de novo review applied, observing that other circuits reviewed subpoena enforcement decisions for abuse of discretion. The Supreme Court granted certiorari to resolve the divide between the Ninth Circuit and other circuits over the proper standard of review.
The Supreme Court held that the appropriate standard of review for a district court's decision to enforce or quash an EEOC subpoena is abuse of discretion. Recognizing that the Title VII provision granting the EEOC subpoena power is identical to the authority granted to the National Labor Relations Board (NLRB) to issue subpoenas, the Court looked to the standard of review used in conjunction with NLRB subpoena enforcement judgments. The Court noted that virtually every circuit courts of appeals reviews EEOC subpoena enforcement cases under the abuse of discretion standard. Further, the abuse of discretion standard falls in line with longstanding practices in other contexts, including in reviewing district court decisions on evidentiary issues at trial and the scope of pretrial criminal subpoenas.
On April 3, 2017, the Supreme Court reversed the Ninth Circuit's decision and remanded the matter back to the Ninth Circuit to reconsider the EEOC subpoena under the proper standard of review. The judgment was issued May 5, 2017. The Court specifically noted that using the abuse of discretion standard, the Ninth Circuit may, if it believes proper, consider the employer’s arguments regarding whether the EEOC’s subpoenas are unduly burdensome.
Practical Tips for Employers
Fighting the EEOC or other governmental entities over a subpoena can be time-consuming and expensive. Since the standard of review is specifically defined as abuse of discretion, it is unlikely there will be frequent overturning of a federal district court’s decision on appeal. Therefore, the real fight over subpoena enforcement will take place in the trial court.
As an employer, it is important to know that when governmental entities, like the EEOC, issue information requests that are irrelevant to the charge or appear to overstep their bounds, it is appropriate to challenge the subpoenas on grounds that they are irrelevant, overly burdensome to the employer, or are sought for an improper purpose.
However, if faced with an overly broad request for information from a governmental entity, it may be worthwhile to attempt to negotiate a resolution. If an agreement can be reached before a subpoena is even issued, employers may avoid the expense and publicity that could arise from a subpoena enforcement dispute in court.
Employers should work closely with expert legal counsel when attempting to negotiate a resolution. If you have questions about compliance with any governmental subpoenas, please contact the attorneys at Palmer Kazanjian Wohl Hodson LLP.