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	Presentation - When The EEOC Comes Calling: Strategies for Dealing with Investigations and Prevailing in Claims Employment/Labor  Presentation - Strafford Publicatons, Inc. Teleconference (November 2008) By Teresa R. Tracy I. STRATEGIC USE OF PRIVILEGES IN RESPONDING TO EEOC’S DISCOVERY REQUESTS AND OBTAINING DISCOVERY FROM EEOC A. Responding to EEOC’s Discovery Requests Rapid internal investigations can be critical in developing the strategy for defending a collective or class action. However, they raise numerous potential problems related to preserving privileges. Furthermore, it is not uncommon for the EEOC to request information and documents that would otherwise be considered private and personal, perhaps even subject to protection under various statutory or judicially-created privileges. Thus, a response to such a request should strategically consider whether, when, and how to assert these privileges. Protect Employer’s Privileges One of the first decisions in any internal investigation is whether and how to conduct the investigation with respect to protections offered by the attorney-client privilege and work product doctrine. General Counsel and outside counsel should be consulted on this important issue. Assuming that the decision is made to take advantage of all possible protections, the investigation must be carefully structured to avoid losing the protections through inadvertent discussions and disclosures. This will generally mean that counsel and their staff (whether inside or outside the company) will be involved in developing, analyzing, discussing, and presenting the information. It is likely that at some point in the administrative stage or later litigation, some or all of the information developed will be disclosed to the EEOC and perhaps even the other side. While this may require at least a partial waiver of the protections afforded by the attorney-client privilege, attorney work product should be carefully protected. Thus, it is important to include the person identified as the person who will ultimately testify about the information in the development of the information. The most likely participants in the investigation include: 1. Internal company resources with critical expertise who will make good witnesses, if necessary (e.g., Human Resources, Payroll, IT) 2. Consultants and testifying experts 3. Subject matter experts Discussions with and among these individuals must be conducted so as to protect against losing the privileged status of the discussion. Furthermore, while the “advice of counsel” defense may serve to blunt the effect of the EEOC’s (or later, an employee/plaintiff’s) attack on the reasons for the employer’s decisions and perhaps serve as the basis for arguing that punitive damages should not be awarded, the use of this defense may waive the attorney-client privilege even as to trial counsel. Thus, this issue should be carefully considered in deciding who as counsel should be involved in the investigation and advice, the jurisdiction in which any action may be litigated, and the likelihood that the “advice of counsel” defense will be used. Cases that have considered the “advice of counsel” defense include: » In re Seagate Technology, LLC, 2007 U.S. App. LEXIS 19768 (Fed. Cir. 2007)(as a general proposition, asserting the advice of counsel defense and disclosing opinions of opinion counsel do not constitute waiver of the attorney-client privilege for communications with trial counsel) » Informatica Corp. v. Bus. Objects Data Integration, Inc., 454 F. Supp. 2d 957 (N.D. Cal. 2006)(waiver applied to trial counsel) » Collaboration Props., Inc. v. Polycom, Inc., 224 F.R.D. 473, 476 (N.D. Cal 2004); Ampex Corp. v. Eastman Kodak Co., 2006 U.S. Dist. LEXIS 48702 (D. Del. July 17, 2006)(waiver not extended to trial counsel) » Intex Recreation Corp. v. Team Worldwide Corp., 439 F. Supp. 2d 46 (D.D.C. 2006); Beneficial Franchise Co., Inc. v. Bank One, N.A., 205 F.R.D. 212 (N.D. Ill. 2001); Micron Separations, Inc. v. Pall Corp., 159 F.R.D. 361 (D. Mass. 1995)(waiver extended to trial counsel only for communications contradicting or casting doubt on the opinions asserted) » Nguyen v. Excel Corp., 197 F.3d 200 (5th Cir. 1999)(employer contended that it consulted with its attorneys regarding the obligations imposed upon it by the FLSA, but it had not asserted and would not assert reliance on advice of counsel as a predicate for its good faith beliefs; court found that privilege had been waived and ordered limited depositions of both the trial counsel and in-house counsel based on the employer’s failure to object to questions designed to elicit privileged information and failure to halt executive/deponents’ responses to all such questions, and one executive indicated that the employer had solicited advice equally from these attorneys) » Scholtisek v. Eldre Corp., 441 F. Supp. 2d 459 (W.D.N.Y. 2006)(employer’s in limine motion to preclude the use of any testimony concerning certain conversations between its former human resources manager and its former executive vice president was denied where the statements were made in response to the human resources manager’s inquiry concerning certain wage matters on behalf of a particular employee; former vice president had responded that she was told that the handbook had been gone over by the company’s attorneys and everything in it was legal) » Newman v. Countrywide Home Loans, Inc., 144 Lab. Cas. (CCH) P34, 368; (N.D.Tex. 2001)(employer denied that its conduct was willful and asserted a defense of good faith based on the advice of counsel; both its assertion of this defense and its disclosure of its attorney’s opinion letters constituted waiver of the attorney-client privilege insofar as it related to communications to or from counsel seeking and giving advice with respect to the exempt or non-exempt status of account executives and the employer was thus ordered to produce documents relating to the methodology or formulae used to classify the employer’s employees and documents used or relied upon in determining that the plaintiff’s position as an account executive was an exempt position) » Dawson v. New York Life Ins. Co., 901 F. Supp. 1362 (assertion of advice of counsel defense to claim to violation of FLSA resulted in waiver of privilege as to certain discovery) Tips for Establishing and Maintaining Privileged Status • Appropriately mark privileged documents • Maintain privileged documents in a confidential manner • Include counsel in interviews and discussions • Be careful of non-privileged discussions • Have preliminary database construction and manipulation performed by non-testifying personnel at direction of counsel • Identify who will make and receive reports, and what type of report will be made Discrimination laws include non-retaliation provisions. Therefore, make sure that everyone involved in the investigation is familiar with these provisions. In particular, when involved in EEOC investigations initiated by one of the Commissioners or a class-based claim, do not attempt to identify the employee(s) who were the basis for initiating the complaint. Plan the scope of the investigation. Most often, the investigation will first focus on the allegations of any complaint. However, if concerns arise during the scope of the initial investigation that there may be additional violations, decide whether and to what extent to expand the investigation. Be careful that any expanded investigation is appropriately insulated from the original investigation and that it, too, is conducted in a way so as to maximize the availability of the attorney-client privilege and the work product doctrine. Do not assume that a “self-critical analysis” privilege will apply; many courts have not recognized such a privilege, and those that have recognized it have done so in limited contexts. The investigation will almost certainly include the review of documents (e.g., personnel files, medical records), training given, and systems. If an area is lacking, consider what other information is available to “fill in the gaps.” Prepare a witness interview outline for use at the various levels and types of employees who will be interviewed. Include non-retaliation language. Make sure that the interview focuses the questions on the facts that will be important for the defense of the case. Counsel should be involved in making reports so as to maximize available protections. It is more important in class actions to keep upper management advised due to the larger potential damages and implications for the company’s manner of conducting its business. The person(s) designated to receive the reports should be cautioned about ways to avoid waiving any privilege protections. The way in which reports are delivered can also be important. For example, where there is the likelihood of liability and high damages, it may be better to make informal, oral reports particularly if the problem is not likely to be remedied so as to minimize the possibility of a willful violation being found. Reports should be carefully worded to avoid conclusory language that will bury the company if it turns out that the report must be – or is inadvertently – disclosed. Sample cases in which privilege issues have arisen: » United States v. BDO Seidman, LLP, 492 F.3d 806 (7th Cir. 2007)(In the context of an IRS attempt to enforce administrative summonses against an accounting firm that allegedly failed to disclose potentially abusive tax shelters that it promoted, the court reviewed whether the attorney-client privilege was maintained through the common interest doctrine. The common interest doctrine is really an exception to the rule that no privilege attaches to communications between a client and an attorney in the presence of a third person and, in effect, extends the attorney-client privilege to otherwise non-confidential communications in limited circumstances, i.e., where the parties undertake a joint effort with respect to a common legal interest, and the communication is made to further an ongoing enterprise. Here, the memo in question was originally addressed to the company’s outside counsel from a company employee and requested advice on a legal question. The memo was subsequently forwarded to a different law firm. The company successfully argued that it was forwarded as part of the company’s effort to coordinate with the second firm regarding a common legal position that the company and the second firm would later communicate to their joint clients and that the document remained privileged despite the fact that the second firm voluntarily disclosed the memo in response to an IRS subpoena.) The First, Federal, Fourth, Second, Ninth and Seventh Circuits have held that litigation need not be actual or imminent for communications to be within the common interest doctrine; the Fifth Circuit has held otherwise. » Herrman v. Gutterguard, Inc., 199 Fed. Appx. 745 (11th Cir. 2006)(defendant in FLSA collective action successfully disqualified the plaintiffs’ lead counsel and his firm on the ground that a conflict of interest existed because he had previously worked at an employment defense firm which had performed a compliance audit for the parent company and affiliated companies which were now the defendants in the case) » In re Qwest Communications International, Inc., 450 F.3d 1179 (10th Cir. 2006)(court declined to adopt a “selective waiver rule” which would have continued the attorney-client privilege and work product protection to certain documents, despite the company’s voluntary disclosure to the SEC and DOJ). The First, Second, Third, Fourth, and D.C. Circuits have also rejected the “selective waiver rule.” » Pichler v. UNITE, 446 F. Supp. 2d 353 (E.D.Pa. 2006)(The Driver’s Privacy Protection Act of 1994, 81 U.S.C.S. §§ 2721-2725 does not allow a person to acquire personal information from the motor vehicle records for the purpose of finding and soliciting clients for a lawsuit. In order for the litigation exception to apply, there must be an actual investigation, litigation must appear likely at the time of the investigation, and the protected information acquired during the investigation must be of “use” in the litigation, meaning that there is “a reasonable likelihood that the decision maker would find the information useful in the course of the proceeding.”) » Colindres v. Quietflex Mfg., 228 F.R.D. 567 (S.D.Tex. 2005)(In this discrimination class action, the defense expert sent defense counsel an unsolicited email discussing two specific questions which the court had asked. The expert subsequently submitted his supplemental report that addressed one of the two questions he discussed in the email. The email addressed the expert’s understanding of the payroll data and the ability to use that data to calculate back pay, while taking into consideration individual variations caused by the piece rate wage. Defendants offered his expert testimony on the issue of calculating back pay. The court held that the email was not privileged and ordered that it be disclosed.) B. Providing Information on “Confidential” Basis The EEOC has taken the position that information and documents that are provided to it can be disclosed to the charging party, and at least under Title VII, has prevailed on this issue. EEOC v. Associated Dry Goods Corp., 449 U.S. 590 (1981)(EEOC can disclose information from a charging party’s file to that party, but not information from the files of other charging parties who had brought claims against employer, because limited disclosure enhanced EEOC’s ability to resolving charges through informal conciliation and negotiation, but Court noted that issues concerning the Trade Secrets Act and the FOIA were not before the Court). The courts have grappled with the issue of what information an employer can withhold from providing to the EEOC on confidentiality grounds. In general, unless the employer can prove a compelling reason, e.g., trade secret status, the courts will require production. However, an employer should, if the information is sufficiently sensitive, request a confidentiality agreement with the EEOC. Although the EEOC itself is reluctant to enter into such agreements, it is a good first step to requesting protection from the courts. The courts have demonstrated their willingness to review confidentiality issues on specific items of information, and when they believe it to be appropriate, to require the EEOC to enter into such confidentiality agreement on specified items of information. Cases in which the courts have considered confidentiality arguments include: » University of Pennsylvania v. EEOC, 493 U.S. 182 (1990)(employer in Title VII case required to disclose peer review materials from an EEOC subpoena where statutory language was broad, precedent for the privilege was nonexistent, and disclosure did not infringe the right of “academic freedom” because the subpoena was content neutral). » Adkins v. Christie, 488 F.3d 1324 (11th Cir. 2007)(medical peer review privilege did not apply in § 1983, 1981, 1985 racial discrimination case; by arguing that the physician fell below its standards, the hospital put other peer reviews at issue) » EEOC v. HWCC-TUNICA, Inc., 2008 U.S. Dist. LEXIS 85830 (N.D. Miss. 2008)(EEOC filed motion to compel production pursuant to a demand for production of records; request sought “any and all documents used to respond to the Complaint filed in this action” as well as documents from non-party personnel files. The court found that the former was not overbroad nor did it impinge on the attorney-client privilege or attorney work product to the extent that the company internally investigated claims of discrimination as much to resolve them as to prepare for anticipated litigation but excluded from production confidential communications between defense counsel and client and documents prepared in anticipation of litigation subject to preparation of privilege log) as to the latter, the court declined to require production of the entire personnel files of the employer’s former human resources personnel on the ground that it was highly unlikely that they would contain relevant information and the EEOC had contact information for these individuals)) » EEOC v. CRST Van Expedited, Inc., 2008 U.S. Dist LEXIS 28113 (N.D. Iowa 2008)(in pattern and practice litigation, the employer successfully argued that the EEOC was not entitled to the name of an employee and the name of the alleged harasser unless and until the employee indicated an intent to be included in the litigation) » EEOC v. Sheffield Financial LLC, 2007 U.S. Dist. LEXIS 43070 (M.D.N.C. 2007)(in this national origin discrimination case, the employer sought discovery of medical information relating to the employee’s health care, mental health treatment, counseling, and similar medical information; the EEOC resisted, claiming that the request was overbroad, irrelevant, and that the employee’s mental state and medical history were not at issue because the EEOC was only seeking “garden-variety” compensatory damages; the court had little difficulty finding the requested discovery to be relevant to the issue of damages because the employee was seeking damages for “past and future emotional distress, humiliation, anxiety, inconvenience, and loss of enjoyment of life;” that there was no privilege that applied, and that any privacy concerns were adequately addressed through a consent protective order) » Martinez v. EEOC, 2004 U.S. Dist. LEXISS 23182 (W.D. Tex. 2004)(employee sought the EEOC’s entire investigative file of his administrative charge against his former employer; EEOC produced “public information” but withheld 17 pages on the ground that it was privileged on the ground of personal privacy and confidential source (because the investigator had promised two witnesses confidentiality); court upheld withholding everything but two envelopes) » Venetian Casino Resort, L.L.C. v. EEOC, 530 F.3d 925 (D.C.C. 2008)(In response to subpoena from EEOC in an ADEA case, employer submitted commercial information that it deemed and identified as confidential. The EEOC subsequently subpoenaed more documents. When the EEOC later denied the employer’s petition to revoke the subpoena, this case ensued. After finding that the details of the EEOC’s disclosure policy were unclear on the record before it, the court nevertheless concluded that the record left no doubt that the EEOC had the policy of disclosing confidential information without notice to the submitter. The court remanded the case to the district court to enjoin the EEOC from disclosing the employer’s confidential information without adhering to the notice and other requirements of the EEOC’s regulations implementing the FOIA. The EEOC ran into trouble in this case because it had two irreconcilable policies, one of which – the Compliance Manual (Section 82) relating to the Privacy Act – apparently enabled the EEOC or, for that matter, any person asking for information, to circumvent the other regulation (29 CFR § 1610.19, et seq.) that implemented the FOIA and required pre-release notification for confidential commercial information.) » EEOC v. Bessemer Group, Inc., 105 Fed. Appx. 411 (3rd Cir. 2004)(employer lost argument that it should not have to comply with EEOC subpoena because it asserted that its practices were legal and thus the absence of a statutory violation rendered the purpose of the investigation illegitimate; court agreed with EEOC that more information was necessary before a dispositive legal determination could be made as to whether the employer was in compliance with law) » EEOC v. Ocean City Police Department, 820 F.2d 1378 (4th Cir. 1987)(en banc)(quashing subpoena relating to Title VII charge because the charge was untimely) » EEOC v. Group Health Plan, 212 F. Supp. 2d 1094 (E.D. Mo. 2002)(quashing subpoena because the charge against the employer did not involve practices covered by the ADA) » EEOC v. WinCo Foods, Inc., 2006 U.S. Dist. LEXIS 64521 (E.D. Cal. 2006)(court rejected EEOC’s argument that employer failed to exhaust its administrative remedies by failing to object to subpoena and therefore waived objections; court held that compliance with 29 CFR sec. 1601.16(b) – which provides that any person served with subpoena who intends not to comply shall petition the issuing director – was not jurisdictional and inconsistent with 29 USC sec. 161 which made such a petition discretionary This does not mean that an employer cannot take action where an employee violates the privacy rights of others. See, e.g., Vaughn v. Epworth Villa, 537 F.3d 1147 (10th Cir. 2008)(plaintiff filed EEOC charge alleging she was discriminatorily disciplined for errors; she later submitted the copy of the redacted medical record to prove her point. When the employer later found out about this disclosure, it terminated her. The Tenth Circuit held that the plaintiff engaged in a “protected activity” when she submitted the unredacted medical records to the EEOC. However, because she was unable to show that others who had violated the employer’s policy – and possibly federal law protecting the confidentiality of medical records – had not been terminated, she failed to prove that her termination was unlawful retaliation.) C. Deliberative Process Privilege This privilege protects certain predecisional, internal agency information, such as recommendations and analysis, from disclosure during litigation. The government may withhold evidence in litigation in any of the following circumstances: (1) where a statute makes certain documents or information confidential; (2) where a privilege or objection is available to any other litigant under the Federal Rules of Civil Procedure (for example, relevance, undue burden, or attorney-client privilege); or (3) where a special privilege exists unique to the government – such as the deliberative process privilege. The EEOC typically asserts this privilege in litigation in order to protect the confidentiality of internal, deliberative material, such as documents containing the analyses, opinions, or recommendations of enforcement unit staff, and attorney memoranda containing analysis or recommendations. There are few cases which extensively address this privilege. » EEOC v. American International Group, Inc., 1994 U.S. Dist. LEXIS 9815 (S.D.N.Y. 1994)(the court noted that the privilege only protects information which is predecisional and deliberative. It does not protect factual findings or factual material which may be severed from the deliberative portion of a report) » EEOC v. Fina Oil and Chemical Co., 14 F.R.D. 74 (E.D. Tex. 1992)(court noted that since the purpose of the privilege is to protect the full and free exchange of information in the agency, the test is whether disclosure would serve only to reveal the evaluative process by which a member of the decision-making chain arrived at his/her conclusion) » EEOC v. Albertson’s LLC., 2007 U.S. Dist. LEXIS 32003 (D. Col. 2007)(EEOC’s assertion of this privilege in response to a Rule 30(b)(6) deposition notice was found to be premature where not a single question had yet been asked) » EEOC v. Continental Airlines, 395 F. Supp. 2d 738 (N.D. Ill. 2005)(example of case in which the employer argued that even where the privilege is found to exist, its need for the information outweighs the need for the privilege) Although EEOC attorneys can assert this privilege in litigation on their own authority (for example, in responses to discovery requests or when defending depositions), the privilege must be formally asserted by the head of the EEOC whenever the applicability of the privilege becomes an issue before a court (for example, in connection with motions to compel, for protective orders, or to quash subpoenas. D. Work-Product Doctrine In EEOC v. Carrols Corp., 215 F.R.D. 46 (N.D.N.Y. 2003), the court ruled that questionnaires which the EEOC had sent to the employer’s employees using a database supplied by the employer constituted the EEOC’s work product, even though the questionnaires were completely filled out by the individuals and simply returned to the EEOC. Furthermore, the EEOC had offered to supply the employer with witness summaries that would serve to identify the witness and provide at least some insight into the witnesses’ likely testimony. Thus, although the EEOC was ordered to provide the summaries which it had offered, but was not ordered to produce the actual questionnaires. Since the court made a ruling based on this doctrine, it did not address the EEOC’s argument that the claimant communications were protected by the attorney-client privilege; however, it commented that it “is not at all clear that the EEOC has satisfied its obligation to factually demonstrate each of the recited elements” to successfully invoke that privilege. On another matter in dispute, the Carrols court ordered the EEOC to ascertain whether it had developed statistical data relating to the incidence of sexual harassment or retaliation complaints in workforces comparable in size, turnover rate, dispersion or working conditions similar to that of the employer, rejecting the EEOC’s work product doctrine argument. E. Attorney-Client Privilege The EEOC can also assert an attorney-client privilege. Numerous cases have held that the EEOC bears the burden of establishing which allegedly aggrieved parties it represents and the bases upon which the EEOC claims to have an attorney-client relationship with the party. This can involve an evaluation of the “client’s” indication of any desire for such a relationship, as well as when such a relationship was actually established. Some cases that have reviewed this question include: » EEOC v. Int’l Profit Assocs., 206 F.R.D. 215 (N.D. III. 2002)(the court found that certain allegedly aggrieved employees had established an attorney-client relationship with the EEOC. In doing so, however, the court did not rely merely on the fact that the EEOC claimed that the particular employees were among the allegedly aggrieved parties; instead, the court noted that the women had “contacted the EEOC via returned questionnaires or telephone calls” and that “each woman identified as a class member was asked if she wished the EEOC to act on her behalf in this lawsuit and each class member replied in the affirmative.”) » EEOC v. Johnson & Higgins, Inc., 1998 U.S. Dist. LEXIS 17612, (S.D.N.Y. 1998) (holding that in connection with an EEOC enforcement action “[w]hether a privileged attorney- client relationship exists rests upon the client’s intent to seek legal advice and the client’s belief that he is consulting an attorney. . . . The burden of sustaining the privilege is on the proponent - here, the EEOC”) » EEOC v. Chemtech Int’l Corp., 1995 U.S. Dist. LEXIS 21877 (S.D. Tex. 1995) (finding that an attorney-client relationship existed between an aggrieved party and the EEOC based on an affidavit from the client stating that he believed that an attorney-client relationship existed) » EEOC v. Georgia-Pacific Corp., 1975 U.S. Dist. LEXIS 15377 (D. Ore. 1975)(finding an attorney-client relationship based on the contents of the client’s letters clearly indicating that she was contacting the EEOC litigation center for expert legal advice and that she expected her communications to remain confidential). See also, EEOC v. HBE Corp., 64 Fair Empl. Prac. Cas. (BNA) 1518 (E.D. Mo. 1994), rev’d in part on other grounds, 135 F.3d 543 (8th Cir. 1998); EEOC v. Collegeville/Imagineering Ent., 2007 U.S. Dist. LEXIS 3764 (D. Ariz. 2007) » Equal Employment Opportunity Comm’n v. Morgan Stanley & Co., Inc., 206 F. Supp. 2d 559, 561 (S.D.N.Y 2002)(“[t]he case law is not definite regarding the moment when the EEOC enters into an attorney-client relationship with the members of the class it seeks to represent.” The United States Supreme Court has made clear that any order limiting communications between parties and potential class members should be based on “a clear record and specific findings that reflect a weighing of the need for a limitation and the potential interference with the rights of the parties.” Gulf Oil Co. v. Bernard, 452 U.S. 89, 101-02, 101 S. Ct. 2193, 68 L. Ed. 2d 693 (1981)) » EEOC v. Albertson’s Inc., 2006 U.S. Dist. LEXIS 73278 (D. Col. 2006)(the court considered a motion by the EEOC to prohibit defense counsel from contacting allegedly aggrieved parties outside of the presence of the EEOC’s lawyers. It denied the EEOC’s request. The EEOC’s actions merely in filing an enforcement case and identifying a group of people as being among the allegedly aggrieved parties, without more, is insufficient to create an attorney-client relationship between the allegedly aggrieved parties and the EEOC. The case cites numerous prior cases which will be helpful to defense counsel on this issue) » EEOC v. TIC, 90 Fair Empl. Prac. Cas. (BNA) 737 (E.D. La. 2002)(considered the EEOC’s motion for protective order in which it asked that the employer be precluded from engaging in ex parte communications with all potential claimants in the action. The EEOC argued that although it did not have an attorney-client relationship with all potential claimants, it was entitled to invoke the attorney-client privilege and the American Bar Association’s Model Rule of Professional Conduct 4.2 to prevent the employer from talking with potential claimants because the EEOC represents all claimants’ interests in this action. After reviewing prior judicial decisions on this issue, the court concluded that the EEOC had simply not provided evidence to support its position. In addition, since the EEOC was suing with respect to applicants who had not been hired, the fear of retaliation was minimal) II. WHEN CHARGES ARE NOT SETTLED EARLY A. Constraints on Agency Investigations The EEOC has an arsenal of weapons at its disposal if the charge does not resolve at a very early stage. Some of the most common are further requests for information, and interviews. Interviews of claimants and potential claimant-supportive witnesses can either be done on-site or off-site, and either in person or by telephone. Thus, an employer should consider who is likely to be contacted by the EEOC and whether or not to approach these individuals about the potential interview. It may be helpful to let the person know that the EEOC – a governmental agency – may be contacting them and an overview of the individual’s rights in such a circumstance, including the right not to talk to the EEOC and the right to have an attorney paid for by the employer present during any such interview. However, such discussions must be done very carefully and should be documented, so as to avoid charges that the employer was interfering in the EEOC’s investigation or implicitly discouraging the individual from talking to the EEOC or threatening retaliation for doing so. If the EEOC wants to schedule an on-site visit, including interviews, the employer has more control of the situation. It can, and should, attempt to arrange the visit and interviews to have minimal disruption on its operations. It can, and should, conduct its own “on-site” inspection prior to the EEOC’s arrival, to ensure that required posters are actually posted and in good condition, and that objectionable materials are removed. Furthermore, if the EEOC identifies management-level individuals (the employer should consider at what level it will designate positions as having this status) on its interview list, the employer should have pre-interview discussions with those individuals to advise them that the company has the right to have its attorney present and that the company’s decision to do so can also benefit the individual during the interview by clarifying questions, etc.; to go over issues and facts that the EEOC is likely to ask about; and to remind the individual of the instruction to tell the truth. The EEOC does have the authority to conduct unannounced on-sites; this is a bad sign for the employers, since it signals that the EEOC believes the employer is being unreasonably uncooperative in the investigation. The interview should be set up in a confidential place. We prefer someplace that is acceptably comfortable yet away from an area where the EEOC interviewer is likely to “run into” employees, since the interviewer often takes the opportunity to conduct impromptu interviews. The employer should make copies for itself of any documents inspected by the EEOC during the visit. In our experience, the EEOC is generally cooperative in scheduling on-site visits and the interview schedule suggested by the employer, as long as the employer does not appear to be unduly uncooperative or appearing to unreasonably be delaying the visit. The employer should be aware that the EEOC can widen the investigation if it has reason to believe that there are violations beyond what is alleged in the charge. During the investigation stage, the EEOC can issue subpoenas. Employer actions that lead to such a step should be carefully considered because (a) the need for a subpoena usually indicates that the EEOC believes the employer is not cooperating, thus increasing the level of suspicion on the part of the EEOC; (b) it shows the EEOC is committed to the investigation. There are times that an employer may believe that a subpoena is advisory because of the nature of the information that the EEOC is requesting, i.e., to protect the employer in cases of severe employee unhappiness that information is being provided. In such situations, the employer should have a frank discussion with the EEOC investigator. In the event a subpoena is issued, the employer is required to comply, just as with a subpoena issued in other litigation. Under each of the laws enforced by the EEOC except two (the ADEA and the EPA), the employer can file a petition to revoke or modify the subpoena. Under the ADEA and EPA, these procedures are not an option and the employer’s only choice is to refuse to comply; this is likely to trigger an enforcement action which is a public proceeding. If the evidence obtained in an investigation does not establish that discrimination occurred, this will be explained to the charging party. A required notice is then issued, closing the case and giving the charging party 90 days in which to file a lawsuit. If the evidence establishes that discrimination has occurred, the employer and he charging party will be informed of this in a letter of determination that explains the finding. The EEOC will then attempt conciliation with the employer. If the case is successfully conciliated, if a case has previously been successfully mediated or settled, neither the EEOC nor the charging party can go to court unless the employer fails to fulfill the terms of the settlement. If the EEOC is not able to conciliate the case, it will decide whether to bring suit in federal court. If it decides not to sue, it will issue a notice closing the case and giving the charging party 90 days in which to file a lawsuit. In Title VII and ADA cases against state or local governments, the DOJ takes these actions. Prior to filing litigation, charging parties are almost interviewed by one of the EEOC legal unit attorneys and, where practicable, other individuals who will have significant roles in the litigation as either witnesses or claimants will also be interviewed. Typically, the interviews are done in person and will explore the individual’s basis for recovery as well as other knowledge he/she may have relevant to the suit, such as information on the employer’s operations and employment practices and other individual and class claims. The EEOC attorney is also supposed to discuss with the claimant the relief to which he or she may be entitled (including the effect of any personal bankruptcy on such relief) and should obtain at least general information on backpay accrual, mitigation, and any pecuniary compensatory damages the claimant may have incurred. The EEOC attorney should also discuss the standards of obtaining nonpecuniary compensatory damages and the kinds of inquiries the employer will be entitled to make about the claimant if such damages are sought (e.g., obtaining testimony from the claimant and friends, family members, and medical professionals who may have information on subjects that may be normally private and sensitive to the individual; the possibility of a required physical or mental examination, etc.). Although the EEOC brings suit to further the public interest in preventing employment discrimination, the considerations relevant to seeking compensatory damages are unique to each individual. Thus, claims for nonpecuniary compensatory damages should be made only for individuals who have given their express consent following discussion with the EEOC attorney regarding the possible consequences of such a claim. Lastly, the EEOC attorney is supposed to explain during the interview the EEOC’s public interest role in the litigation, the possibility that the EEOC’s and the claimant’s interests may diverge during the litigation, and the claimant’s individual suit and intervention rights, if any. Thus, the claimant is informed that the EEOC may decide to act in a manner that the claimant believes is against his/her individual interests. If the individual has intervened in the suit, the individual will be able to pursue his/her individual interests separately if the EEOC’s interests diverge from the individual’s at any point. The individual has an unconditional right to intervene if done in a timely manner, but the court can deny intervention if the case has progressed substantially by the time the request for intervention is made. In ADEA and EPA cases, the claimant is also informed that the EEOC’s suit will cut off any private right of action the claimant may have. B. Resolution of Commissioner’s Charge A Commissioner’s Charge under Title VII and the ADA is one that is initiated by one of the EEOC Commissioners. While the ADEA and EPA do not specifically refer to Commissioner Charges, the EEOC can conduct a “directed investigation” and litigation on its own initiative under those statutes, either concurrently with the processing of a charge or as a separate matter. Such EEOC-initiated matters can be based on the whim of the Commissioner, but is typically filed when a Commissioner believes that an employer is in violation of the law. This can be triggered by reading something in the paper, or talking to someone in a social setting. Usually a Commissioner’s Charge will be focused on allegations of systemic violations. Under the EPA and the ADEA, the EEOC can conduct an investigation even in the absence of a charge. Most typically, a field office will believe an employer is discriminating but no individual charge has been filed, so the office will obtain public information and submit it to a Commissioner; if the Commissioner agrees, he/she will sign off and return it to the field office, thus initiating a Commissioner’s Charge. Alternatively, the Commissioner or a field office personnel has been approached by a public interest group about a suspected systemic violation. There is no legal significance to a charge as being the traditional charge or a Commissioner’s charge, but there is a very practical significance to the employer: a Commissioner’s charge signals a particular interest on the part of a Commissioner, so it is likely that the EEOC field personnel will take particular care to thoroughly investigate and prosecute the matter. III. WHEN MATTERS ESCALATE TO LITIGATION Once the case is in litigation, the general rules of litigation apply. Counsel for the defense should take advantage of the regular discovery procedures, and should expect the EEOC to do the same. Thus, for example, defense counsel can notice a PMK deposition on specific issues, just as could be done in litigation against an entity that was not the EEOC. Defense counsel should, as a matter of routine, request the entire EEOC file under either a FOIA request or a production demand. Title VII prohibits disclosure to the public of charges filed with the EEOC, and of information obtained during the EEOC’s investigation of the charges. This changes once litigation has been filed. After a lawsuit has been filed, the matter becomes a publicly-litigated case with the same potential for publicity as any other litigation. Thus, an employer should seriously consider whether to resolve an EEOC charge prior to litigation being filed. Where particularly sensitive information is involved, resolution may be the wiser course of action. EEOC attorneys are subject to the same ethical restrictions on disclosures as other attorneys. However, in appropriate circumstances, EEOC attorneys will respond to inquiries from the media. In addition, the EEOC now routinely issues a press release about new cases that it files. It also routinely issues a press release about case resolutions. In cases that have significant public interest implications, the EEOC may authorize a press conference, although such publicity is used sparingly. A. Class Litigation Involving the EEOC 1. No Rule 23 Compliance Required The EEOC may either bring suit in its own name or intervene in a suit brought by a private plaintiff. If the EEOC brings suit in its own name, class certification is not subject to Rule 23 certification procedures. In General Telephone Company of the Northwest v. EEOC, the Supreme Court upheld the EEOC’s authority to seek class-wide relief for victims of discrimination, without being restricted by the class action rules applicable to private litigants. The Court emphasized that when the EEOC files suit, it acts to vindicate the “overriding public interest in equal employment opportunity.” However, if the EEOC has already filed an action on their behalf, individual employees cannot sue on their own behalf. 29 U.S.C. § 216(b)-(c). The above principles have several consequences for employers facing EEOC litigation and their defense counsel. First, due to the lack of any need to meet Rule 23 requirements, (a) numerosity, “similarly situated” and other factors used in class certification have no applicability; (b) the “class” can be – and often is - very small; (c) the “class” can be – and often is – not well-defined; (c) the EEOC typically does extensive and invasive discovery to determine the definition and scope of the “class;” and (d) there is no opportunity to decertify the class. Thus, if the EEOC intervenes in a case, it can easily turn a single-plaintiff case into a “class action,” albeit it one not subject to Rule 23. Class actions can be filed under the Equal Pay Act, but they are subject to the FLSA class procedures that require each member to “opt in” by filing a written consent to be included in the action. 29 U.S.C. § 216(b). B. EEOC Intervention in Individual and Class Cases Under both Title VII and the ADA, intervention is contingent on the EEOC’s certification that the case is of “general public importance.” Generally this means that the case directly affects a large number of aggrieved individuals, involves a discriminatory policy or practice requiring injunctive relief, or has potential for addressing significant legal issues. Other factors relevant to intervention include: 1. The EEOC’s contribution to the success of the litigation. This is the most important secondary factor in the EEOC’s decision and can include personnel and financial resources, and it is of prime importance to defense counsel. EEOC intervention means that the resources of the federal government will be brought to bear against the employer. 2. Private counsel’s ability to litigate the case effectively without EEOC participation. This factor, while related to the factor above, can also include the attorney’s general competence as an attorney, related litigation experience, and financial resources. Even where private counsel is highly skilled and able to adequately fund the case, the EEOC may intervene if to do so significantly increases the likelihood of success in an important case, e.g., if the case is particularly large or complex, or if there is a need for injunctive relief beyond what is being sought by the private plaintiff(s). If the results of the private action are not likely to be affected by the EEOC’s participation, intervention becomes less likely. 3. Because it is in the EEOC’s interest for private attorneys to accept meritorious cases, the extent to which intervention in a particular case may encourage such private litigation (separate from the case at issue) is a factor in determining whether the EEOC will intervene. 4. Normally, intervention has to occur early in the case for the EEOC to play a significant role in the litigation. Thus, the timing of the intervention is a factor. Prior to intervention, the EEOC also has an understanding with private counsel regarding the EEOC’s role, including personnel and financial commitments, litigation strategy, relief sought (including the value of the private plaintiff’s claims), and the EEOC’s nonconfidentiality policy on settlements. Where this understanding cannot be reached, the EEOC typically declines the opportunity to intervene, although it may participate as an amicus curiae. The EEOC’s intervention in a case can turn a relatively simple case into a class action. © 2008 Berger Kahn, A Law Corporation. All rights reserved. Back
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