202001.100

Holding the EEOC Accountable: 8th Circuit affirms EEOC must pay attorney fees incurred by employer on frivolous claims

On December 10, 2019 the 8th Circuit affirmed a federal district court’s order requiring the Equal Employment Opportunity Commission (EEOC) to pay $3.3 million in attorneys’ fees to CRST Van Expedited, Inc. (CRST) for pursuing claims that the commission knew or should have known were frivolous and failing to satisfy presuit obligations under Title VII.

The EEOC originally filed suit against CRST in 2007, after a female driver alleged that two male trainers sexually harassed her during a training trip.  The litigation was filed on behalf of over 250 female employees, and claimed that CRST was responsible for severe and pervasive sexual harassment and that it subjected its female employees to a hostile work environment. The district court found the EEOC had not established a pattern or practice of CRST tolerating sexual harassment, and dismissed the suit. Finding CRST as the prevailing party and that the EEOC had failed to satisfy Title VII’s presuit obligations, the district court entered an attorneys’ fee sanction of nearly $4.7 million against the EEOC.

This award of attorneys’ fees has been hotly contested, and has made its way through the 8th Circuit and back on remand, and up to the United States Supreme Court, which held that a favorable judgment on the merits is not a requirement to be a “prevailing party” when awarding attorneys’ fees.

The case was sent back to the district court, which engaged in extensive individualized inquiries, and found that most of the EEOC’s claims on behalf of 78 claimants for sexual harassment that were dismissed on summary judgment were frivolous, groundless, and/or unreasonable. The district court further found that the dismissal of the 67 other claims as a result of the EEOC’s failure to satisfy the presuit obligations constituted a sufficient alteration of the parties’ legal relationship to award fees.   The district court ultimately issued a fee award of $3,317,289.17, and the EEOC again appealed to the 8th Circuit.

In the recent decision, the 8th Circuit affirmed the district court’s $3.3 million fee award, holding that the district court did not abuse its discretion in holding individualized inquiries, and determining that 71 of the claims it dismissed on summary judgment were frivolous.  The 8th Circuit also upheld the district court’s method of fee calculation and stated the reasoning was sound “in light of the realities of the case, how it was litigated and the [lower] court’s unique understanding of these proceedings.”

The 8th Circuit rejected the EEOC’s arguments that its claims were not frivolous as it conjectured that the EEOC could not hold a reasonable belief that it satisfied its presuit obligations when it actually “wholly failed to satisfy them [under Title VII].”

This ruling should provide employers with assurance of the 8th Circuit holding the EEOC accountable for bringing frivolous claims, and failing to meet its mandatory presuit duties.