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On remand from SCOTUS, 9th Cir still says lower court should have enforced EEOC subpoena

By Lisa Milam-Perez, J.D.

In a case on remand from the U.S. Supreme Court, the Ninth Circuit concluded for a second time that a district court erred in refusing to enforce an EEOC administrative subpoena seeking “pedigree information” (name, social security number, and contact information) on employees and prospective employees who had taken an employer’s mandated physical strength test. The agency requested the information pursuant to its investigation of sex discrimination allegations that the employer unlawfully fired an employee who failed the test. This time around, the Ninth Circuit reviewed the lower court’s order for abuse of discretion—having been instructed by the High Court that de novo review was improper. Again, though, the appeals court vacated the order refusing to enforce the subpoena, concluding that the information was directly relevant to the EEOC investigation (EEOC v. McLane Co., May 24, 2017, Watford, P.).

Case history. In a 2012 ruling, the district court held that the pedigree information sought by the EEOC was not relevant “at this stage” of the agency’s investigation because the evidence already produced by the employer would allow it to determine whether the use of the challenged strength test “systematically discriminates on the basis of gender.” The lower court reasoned that if, after reviewing the evidence already in its hands, the EEOC has reason to suspect systemic discrimination, only then would the pedigree information be relevant, and production to the EEOC might then be “necessary.”

Previously, the Ninth Circuit held that the district court erred by concluding the pedigree information was not relevant and denying enforcement of the administrative subpoena. It reviewed the lower court’s order de novo, in accordance with controlling circuit precedent at the time. However, last month, the Supreme Court vacated the Ninth Circuit judgment after holding that a district court’s decision whether to enforce an EEOC subpoena should be reviewed for abuse of discretion. The High Court remanded the case for the appeals court to evaluate the district court’s ruling under the proper standard of review. Now applying the abuse of discretion standard, but adopting much of its earlier analysis, the Ninth Circuit concluded the lower court erroneously denied enforcement of the subpoena.

EEOC investigation. The court below misunderstood the legal standard governing relevance at the investigative stage. The EEOC has the right to obtain evidence if it relates to employment practices made unlawful under Title VII and the evidence “is relevant to the charge under investigation,” the appeals court explained. It’s not whether the evidence sought by the agency would tend to prove a charge of unlawful discrimination; at this stage, the agency is simply trying to ascertain whether there is “reasonable cause” to find the charge might be true. Consequently, “the relevance standard in this context sweeps more broadly than it would at trial.” It can apply to any evidence that serves to shed light on the allegations at hand.

Relevant. Under this standard, the pedigree information was relevant. The EEOC wanted to contact other employees and job applicants who took the challenged strength test in order to speak with them about their experiences with the test, in hopes of shedding light (positively or negatively) on the allegations. “To pursue that path, however, the EEOC must first learn the test takers’ identities and contact information, which is enough to render the pedigree information relevant to the EEOC’s investigation.”

The employer argued that the EEOC had not shown that production of the pedigree information was “necessary” to complete its investigation in light of all of the other information that the employer already had produced. “But the governing standard is not ‘necessity,” the appeals court reminded; “it is relevance.” It didn’t matter whether the employer, or the court, believed that the EEOC could complete the investigation without the desired evidence. “Congress has not left it to employers accused of discrimination to decide what evidence may be necessary for the EEOC to complete its investigation,” the appeals court explained.

The district court also erroneously held the pedigree information was not relevant at this particular stage of the investigation. It reasoned that the EEOC had enough evidence to determine whether the strength test was discriminatory, so it didn’t really need the pedigree information to determine whether use of the strength test resulted in systemic discrimination. If the EEOC’s analysis of that evidence indicated that systemic discrimination was afoot, only then would the pedigree information become relevant, and thus “necessary,” the lower court concluded. Again, though: whether the EEOC needs the evidence has no bearing on whether the evidence is relevant.

Neutrally applied? The employer’s contention that the pedigree information was not yet relevant also misconstrued the nature of the underlying charge. It argued that the complainant had alleged the strength test was “neutrally applied” and thus, by definition, could not give rise to a disparate treatment claim. But this wasn’t the case; she had never alleged the test was neutrally applied; in fact, she asserted just the opposite: that the test had been discriminatorily applied to her. At any rate, a neutral test requirement could still be applied in a discriminatory fashion. “The very purpose of the EEOC’s investigation is to determine whether the test is being neutrally applied,” the appeals court noted; and the EEOC was not obligated to take the company’s word for it on that point.

Remand. Because the court’s refusal to enforce the EEOC subpoena was premised on an incorrect view of the legal standard governing relevance, the court necessarily abused its discretion when it held that the pedigree information was not relevant to the EEOC’s investigation. As such, the appeals court vacated the order and remanded, noting that the employer was free to renew its assertion that the request for pedigree information was unduly burdensome. Also, the lower court was instructed to address the unresolved issue whether it would be unduly burdensome for the employer to produce information as to why the test takers had been discharged.