Table of Contents

Table of Authorities....................................................................................................... ii

Introduction..................................................................................................................... 1

Argument.......................................................................................................................... 4

Conclusion..................................................................................................................... 14

Certificate of Service

Table of Authorities

Cases Page(s)

Abner v. Kansas City S. R.R. Co.,

513 F.3d 154 (5th Cir. 2008)......................................................................... 10

Allison v. Citgo Petroleum Corp.,

151 F.3d 402 (1998).................................................................................. passim

BMW of N. Am., Inc. v. Gore,

517 U.S. 559 (1996)......................................................................................... 11

Castano v. Am. Tobacco Co.,

84 F.3d 734 (5th Cir. 1996)............................................................................. 7

Celestine v. Petroleos de Venezuella SA,

266 F.3d 343 (5th Cir. 2001)......................................................................... 14

EEOC v. Am. Nat’l Bank,

652 F.2d 1176 (4th Cir. 1981)....................................................................... 14

EEOC v. Dial Corp.,

259 F. Supp. 2d 710 (N.D. Ill. 2003).......................................................... 11

EEOC v. Dinuba Med. Clinic,

222 F.3d 580 (9th Cir. 2000)....................................................................... 4, 5

EEOC v. Gen. Tel. Co. of the Nw.,

885 F.2d 575 (9th Cir. 1989)......................................................................... 13

EEOC v. Monarch Mach. Tool Co.,

737 F.2d 1444 (6th Cir. 1980)....................................................................... 14

EEOC v. Outback Steak House of Fla, Inc.,

576 F. Supp. 2d 1202 (D. Colo. 2008)........................................................ 11

EEOC v. St. Louis-S.F. Ry. Co.,

743 F.2d 739 (10th Cir. 1984)....................................................................... 14

EEOC v. Waffle House, Inc.,

534 U.S. 279 (2002)....................................................................................... 3, 5

Exxon Shipping Co. v. Baker,

554 U.S. 471 (2008)........................................................................................... 7

Gen. Tel. Co. of the Nw. v. EEOC,

446 U.S. 318 (1980)................................................................................ 3, 9, 13

Hardin v. Caterpillar, Inc.,

227 F.3d 268 (5th Cir. 2000).................................................................. 11, 12

Ho v. Martin Marietta Corp.,

845 F.2d 545 (5th Cir. 1988)........................................................................... 6

In re Bemis Co.,

279 F.3d 419 (7th Cir. 2002)....................................................................... 4, 5

Int’l Bhd. of Teamsters v. United States,

431 U.S. 324 (1977)................................................................................ 1, 2, 12

Jefferson v. Ingersoll Int’l Inc.,

195 F.3d 894 (7th Cir. 1999).................................................................... 3, 13

Kolstad v. Am. Dental Ass’n,

527 U.S. 526 (1999)......................................................................................... 11

Oden v. Oktibbeha Cty., Miss.,

246 F.3d 458 (5th Cir. 2001)......................................................................... 12

Patterson v. P.H.P. Healthcare Corp.,

90 F.3d 927 (5th Cir. 1996)........................................................................... 10

Robinson v. Tex. Auto. Dealers Ass’n,

387 F.3d 416 (5th Cir. 2004)........................................................................... 8

Serrano v. Cintas Corp.,

699 F.3d 884 (6th Cir. 2012).................................................................... 3, 13

Smith v. Texaco, Inc.,

263 F.3d 394 (5th Cir. 2001)......................................................................... 12

Tyson Foods, Inc. v. Bouaphakeo,

136 S. Ct. 1036 (2016)................................................................................ 6, 12

Wal-Mart Stores, Inc. v. Dukes,

564 U.S. 338 (2011).................................................................................. 2, 5, 6

Watson v. Shell Oil Co.,

979 F.2d 1014 (5th Cir. 1992)........................................................... 7, 11, 13

Statutes

42 U.S.C. § 2000e-2........................................................................................................ 1

42 U.S.C. § 2000e-5........................................................................................................ 1

42 U.S.C. § 2000e-6........................................................................................................ 1

Introduction

After the EEOC’s administrative investigation uncovered evidence that Bass Pro was engaging in widespread hiring discrimination against Black and Hispanic applicants, the EEOC brought suit against Bass Pro.[1] The Commission alleged a violation of Title VII’s prohibition on discrimination, contained in § 703, 42 U.S.C.

§ 2000e-2, and it invoked its authority to bring an action in district court under two provisions of the statute – § 706 and § 707 [42 U.S.C. § 2000e-5 and § 2000e-6]. As to the action brought under § 707, the parties do not dispute that, regardless of the outcome of this en banc petition, the Commission may prove its discrimination claim in bifurcated proceedings. Those proceedings — the so-called Teamsters framework — would require the Commission to meet a heightened standard of proof to show that Bass Pro engaged in a pattern or practice of discrimination. See Int’l Bhd. of Teamsters v. United States, 431 U.S. 324, 337 (1977) (to show pattern or practice of discrimination, government must show “more than the mere occurrence of isolated or ‘accidental’ or sporadic discriminatory acts . . . [it must show] that “discrimination was the company’s standard operating procedure [—] the regular rather than the unusual practice”). Only if the Commission meets that elevated burden will the district court conduct a second stage of proceedings to determine relief.

The purpose of this two-stage procedure is to simplify the issues for trial in a case involving numerous potential victims. The Teamsters framework resolves class issues at stage 1 before proceeding to individualized relief at stage 2. If the EEOC proves class liability at stage 1, Bass Pro would be an established discriminator and would have the burden at stage 2 of disproving the “inference that any particular employment decision, during the period in which the discriminatory policy was in force, was made in pursuit of that policy.” Id. at 362.

Bass Pro does not challenge the overall validity of that proof framework, nor could it, for the Supreme Court reaffirmed this “established … procedure” in Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338, 366-67 (2011) (discussing necessary additional proceedings to determine relief); see also id. at 352 n.7 (discussing proof framework). In other words, there is no question that if the Commission meets its high proof burden in stage 1 in the action brought under § 707, the district court and the parties will need to resolve how to manage resolution of all equitable relief issues, including back pay awards. So, irrespective of the outcome of the § 706 issue, if the Commission meets its stage 1 burden there would be proceedings at the second stage to ensure that Bass Pro has the opportunity to disprove a particular individual’s entitlement to relief. See Wal-Mart, 564 U.S. at 366-67.

Bass Pro nevertheless urges en banc review in this interlocutory appeal of the availability of the Teamsters proof framework when the Commission also brings suit under § 706. Bass Pro claims that the availability of jury trials and damage awards in a § 706 action renders that proof framework “unmanageable.” Pet. 9. In other words, Bass Pro would have this Court hold that damages and jury trials are categorically unavailable in a case where discrimination is particularly widespread and systemic, that is, a pattern or practice case. No court of appeals to consider this question after passage of the Civil Rights Act of 1991 has agreed with this proposition. See Serrano v. Cintas Corp., 699 F.3d 884 (6th Cir. 2012) (EEOC may utilize the Teamsters framework to prove a claim under § 706 and may seek damages under that framework); Jefferson v. Ingersoll Int’l Inc., 195 F.3d 894, 899 (7th Cir. 1999) (“[A]s the plaintiff in a pattern-or-practice suit under § 706(f)(1) . . . , the EEOC may seek classwide relief . . . .”). It would be perverse, indeed, to hold that Title VII does not allow redress of discrimination because it is perpetrated on a large scale.

Bass Pro’s argument is at odds with the recognition of the Supreme Court and the courts of appeals that Congress’ passage of the 1991 Act did nothing to diminish the EEOC’s authority when it brings suit under § 706. In other words, the precedent explaining EEOC’s § 706 authority — General Telephone Co. of the Northwest v. EEOC, 446 U.S. 318 (1980) — remains good law. See EEOC v. Waffle House, Inc., 534 U.S. 279, 288 (2002) (“Against the backdrop of our decision[ ] in . . . General Telephone, Congress expanded the remedies available in EEOC enforcement actions in 1991 to include compensatory and punitive damages.”); In re Bemis Co., 279 F.3d 419, 421-22 (7th Cir. 2002) (availability of damages after 1991 Act in no way alters “the validity or scope of General Telephone”); EEOC v. Dinuba Med. Clinic, 222 F.3d 580, 588 (9th Cir. 2000) (same).

Factually, it is far from clear that this case will involve an unwieldy number of claimants. The petition references “discovery” and invokes the specter of “tens of thousands” of jury trials, Pet. 1, 7, but the case is in the earliest stages of discovery and to date Bass Pro has not produced any hiring data that would help clarify the number of affected individuals. Nor is there yet any indication that the number of individuals entitled to compensatory damages will be large. Even if discovery does reveal numerous claimants, district courts are well equipped to manage complex litigation.

En banc review in this interlocutory appeal should be denied.

Argument

Bass Pro would have this Court rule that the passage of the 1991 Act means that the Commission may now only use the Teamsters framework when it brings suit pursuant to § 707, not § 706. Bass Pro acknowledges that the Supreme Court in General Telephone ruled that the Commission may use Teamsters when it brings suit under § 706, but Bass Pro argues that the addition of damages and jury trials effectively overturned General Telephone. Bass Pro does not cite to this Court the uniform authority holding to the contrary. See Waffle House, 534 U.S. at 288; Bemis, 279 F.3d at 421-22; Dinuba, 222 F.3d at 588. Instead, Bass Pro argues about due process, manageability, and whether the panel created a new pattern-or-practice cause of action under § 706. Bass Pro relies in particular on this Court’s decision in Allison v. Citgo Petroleum Corp., 151 F.3d 402 (1998), upholding the district court’s refusal to certify a private class action. None of Bass Pro’s arguments supports en banc review.

First, Bass Pro argues that, because of the size of this case, the Teamsters approach will impose undue settlement pressure and upset its due process right to present a meaningful defense at the relief stage. Pet. 3, 9. Bass Pro argues that the panel’s holding to the contrary is at odds with Wal-Mart and Allison. Bass Pro is incorrect.

In Wal-Mart, the Supreme Court reaffirmed that Teamsters “established a procedure for trying pattern-or-practice cases that gives effect to the[ ] statutory requirements.” 564 U.S. at 366. Bass Pro suggests Wal-Mart deemed the Teamsters framework necessarily improper in cases involving large numbers of victims. See Pet. 9-10. That was not what the Court held, however. To the contrary, the Supreme Court held that Rule 23 certification was improper because of a lack of commonality among the “one and a half million plaintiffs.” Wal-Mart, 564 U.S. at 342. Specifically, the Court rejected the plaintiffs’ argument that liability and back pay amounts could be determined by sampling — a “Trial by Formula” — given the differences in the class. Id. at 356, 367; cf. Tyson Foods, Inc. v. Bouaphakeo, 136 S. Ct. 1036 (2016) (discussing Wal-Mart’s rejection of representative evidence based on the facts of that case; holding that using representative evidence was permissible given the similarities of the class). Rule 23 certification is not at issue in this case and the Commission has not proposed a trial by formula. Moreover, the number of claimants will be far, far fewer than the vast numbers at issue in Wal-Mart. Even if it had not reaffirmed Teamsters, therefore, the unique facts of Wal-Mart would not support the broad rejection of Teamsters that Bass Pro urges.

Bass Pro also suggests that the number of potential claimants imposes improper settlement pressures on Bass Pro. Pet. 3. But the increased potential for settlement if a plaintiff establishes liability in the first stage of the Teamsters framework is not grounds for precluding large cases alleging pattern-or-practice discrimination. As a general matter, “public policy strongly encourages the settlement of cases.” Ho v. Martin Marietta Corp., 845 F.2d 545, 547 n.2 (5th Cir. 1988). But more to the point, an employer who loses at the liability stage has been proved to have engaged in systemic discrimination, and its decision to settle at that point would “reflect the relative merits of the parties’ claims.” Allison, 151 F.3d at 422 n.17. The fact that employers’ cost/benefit assessment of continued litigation frequently leads them to settle should not preclude the Commission from using the Teamsters framework.^{^[2]}

Additionally, Bass Pro’s invocation of manageability as a problem is premature. Courts routinely devise case management plans for large class cases. See, e.g., Exxon Shipping Co. v. Baker, 554 U.S. 471, 479-80 (2008) (litigation involving class of 32,000 plaintiffs seeking punitive damages; jury trial divided into separate liability, punitive damages, and compensatory damages phases). This is not a case the district court has deemed unmanageable. Moreover, arguments about a future case management plan are not appropriate for en banc review. See Watson v. Shell Oil Co., 979 F.2d 1014, 1018, 1020 (5th Cir. 1992) (affirming multi-stage trial plan in tort action involving roughly 18,000 claimants; adding that “in many respects this appeal presents only the broad outlines of the district court’s trial plan and, to a large extent, appellate review must await its implementation,” and that “speculative concerns” about the case management plan do not “present an issue ripe for review at this time”).

In concluding that the district court could manage application of the Teamsters framework in a § 706 action by the Commission, the panel recognized that Bass Pro’s contention to the contrary “slight[ed] the management tools at the hand of the district court.” Slip op. at 13-14. District courts are afforded substantial discretion to manage litigation. See, e.g., Allison, 151 F.3d at 408 (recognizing the district court’s “inherent power to manage and control pending litigation”).

Bass Pro contends that because the panel deferred to the district court’s inherent case management authority, rather than imposing a plan, its ruling “amount[ed] to ‘a figure-it-out-as-we-go-along approach’ that this Court has rejected.” Pet.8 (citing Robinson v. Tex. Auto. Dealers Ass’n, 387 F.3d 416, 426 (5th Cir. 2004); Allison, 151 F.3d at 420 n.15). Bass Pro is incorrect.

Both Robinson and Allison discussed manageability in the context of class certification under Rule 23. In Robinson, this Court chastised the district court for failing to craft a suitable case management plan when determining whether a “class action is the superior method for adjudicating this controversy.” 387 F.3d at 426. And in Allison, the Court held that the district court did not abuse its discretion by declining to create workable subclasses on its own when the proposed class was not workable. 151 F.3d at 420 & n.15. Neither case suggests that the panel here erred in recognizing that “[i]t is the district court—with the flexibility afforded to it by the Rules of Civil Procedure, here prominent Rule 49—that is in the best position to fulfill the task of enforcing the Congressional charge to protect the rights of employees.” Slip op. at 16. Moreover, unlike Robinson or Allison, this is not a Rule 23 case, where superiority, certification, and subclasses are at issue.[3] See Slip op. at 13 n.61 (citing Gen. Tel., 446 U.S. at 324). The Commission need not seek Rule 23 certification, see Gen. Tel., 446 U.S. at 324, and to apply Rule 23 considerations to a Commission case would subvert the General Telephone holding.

Bass Pro’s reliance on Allison suffers from another serious problem. Bass Pro mischaracterizes Allison as holding categorically that punitive damages “must be” assessed at the second (remedial) stage of Teamsters proceedings, which it argues would create both manageability problems and potential Seventh Amendment problems of having different juries deciding overlapping issues. Pet. iv. The panel’s suggestion that punitive damages could be decided in the first (liability) phase of the proceedings, Bass Pro argues, offends the rule announced in Allison. Pet. 10. But Allison announced no such categorical rule. Allison acknowledged that its holding would not apply to a case “where the entire class or subclass is subjected to the same discriminatory act or series of acts.” 151 F.3d at 417; see also id. (noting holding was for damages “in this case”). Allison involved hiring, compensation, promotion, and training claims, and challenges to “various policies and practices over a period of nearly twenty years.” Id. This case is not so varied, and punitive damages could be managed in the way the panel suggests.

Bass Pro also attacks the panel’s suggestion that punitive damage liability be assessed at the first stage by arguing that punitive damages are “inextricably intertwined” with compensatory damages, which would be assessed at the second stage. Pet. 11. There is some language in Allison indicating that punitive damages would be assessed at the relief stage because “recovery of punitive damages must necessarily turn on the recovery of compensatory damages.” Allison, 151 F.3d at 417-18. The Commission submits that this language was dicta and does not represent the law of this Circuit given the clear holding of a subsequent decision: Abner v. Kansas City Southern Railroad Co., 513 F.3d 154, 160 (5th Cir. 2008). In Abner this Court held squarely that “a punitive damages award under Title VII . . . need not be accompanied by compensatory damages.” Delinked from compensatory damages, punitive damages may be tried at whatever stage the district court deems most consistent with Title VII and the Seventh Amendment.

Even if this Court had not issued Abner, however, Bass Pro misunderstands the connection between punitive and compensatory damages. Where the two types of damages are linked, they are linked as to amounts. Patterson v. P.H.P. Healthcare Corp., 90 F.3d 927, 943 (5th Cir. 1996) (“the quantum of this [punitive damage] award does not comply with the three factors set out by the Supreme Court to determine the reasonableness of a punitive damage award”) (citing BMW of N. Am., Inc. v. Gore, 517 U.S. 559 (1996)) (emphasis added). Courts can readily manage a case to meet this requirement by having general liability for punitive damages assessed in the first phase[4] and the amount of punitive damages to be awarded to each individual assessed in the second phase, where compensatory damage liability is determined. See Watson, 979 F.2d at 1018 (upholding district court’s trial plan dividing tort action into four phases, with first phase dedicated to “common issues of liability, including liability for punitive damages”); Cf. EEOC v. Dial Corp., 259 F. Supp. 2d 710, 712 (N.D. Ill. 2003) (dividing trial into phases, with same jury deciding compensatory damages for individuals and amount of punitive damages for each individual); EEOC v. Outback Steak House of Fla., Inc., 576 F. Supp. 2d 1202, 1205-07 (D. Colo. 2008).

Bass Pro is also incorrect that Hardin v. Caterpillar, Inc., 227 F.3d 268, 272 (5th Cir. 2000), supports the notion that “liability, compensatory damages, and punitive damages are inextricably intertwined in Title VII actions and must be resolved together.” Pet. 11. Hardin was an individual case, not a case tried under the Teamsters framework. Moreover, Hardin said the opposite of what Bass Pro represents: “We are persuaded of the practical inseparability of the issues of intent, of damages for emotional injury, and of punitive damages in this case, a conclusion we can and do reach without deciding that they are inseparable as a matter of law across all cases; and we do not suggest that punitive damages may not walk alone in other contexts.”^{^[5]} 227 F.3d at 272-73 (emphasis added). Indeed, as the Supreme Court held recently, a single proceeding addressing both liability and damages may well cause more problems than bifurcated proceedings. See Tyson Foods, 136 S. Ct. at 1050.

Compensatory damages also do not create manageability concerns. Bass Pro warns that the panel opinion empowers the Commission to seek compensatory damages on behalf of “every Black or Hispanic applicant” denied a job at a Bass Pro store. Pet. ii-iii, 1 (framing issue as whether EEOC can seek compensatory damages “on behalf of tens of thousands” of unsuccessful applicants and requiring “thousands of Stage II jury trials”). Bass Pro’s hyperbole cannot be squared with the likely progress of this case. Assuming the Commission can meet its heightened burden of proving a pattern or practice of discrimination, it is not “every” applicant but only those denied employment for discriminatory reasons who are entitled to some relief. Teamsters, 431 U.S. at 362. From this group, only a smaller pool will have the evidence of injury needed for a compensatory damage award. Cf. Oden v. Oktibbeha Cty., Miss., 246 F.3d 458, 470 (5th Cir. 2001); Allison, 151 F.3d at 417-18. And as this Court recognized in Watson, a single jury could consider multiple individuals’ claims for relief. See Watson, 979 F.2d at 1018.

Bass Pro also argues that the panel overemphasizes General Telephone, and that while General Telephone authorized the Commission to seek class relief under § 706 it did not authorize the use of the Teamsters framework under that provision. Pet. 12. Bass Pro is wrong. The Supreme Court knew that this authority meant that the Commission could invoke the Teamsters framework because the Court explicitly noted that the Commission had sought to prove its case using that framework: “[h]ere

. . . EEOC moved to try initially the issue of liability, not to avoid proving individual claims, but merely to postpone such proof.” Gen. Tel., 446 U.S. at 333. And the Commission, still proceeding under § 706, went on to try the case using the Teamsters framework after remand. See EEOC v. Gen. Tel. Co. of the Nw., 885 F.2d 575, 577, 584 (9th Cir. 1989) (reversing district court’s finding that “EEOC had failed to prove that GenTel engaged in a company-wide pattern or practice of intentional discrimination”). Every circuit court to have addressed the issue agrees. Serrano v. Cintas Corp., 699 F.3d 884, 896 (6th Cir. 2012) (holding the Commission may “pursue a claim under the Teamsters pattern-or-practice framework, pursuant to its authority vested in § 706” ); Jefferson v. Ingersoll Int’l Inc., 195 F.3d 894, 899 (7th Cir. 1999) (General Telephone “holds that, as the plaintiff in a pattern-or-practice suit under

§ 706(f)(1) . . . , the EEOC may seek classwide relief”); EEOC v. Am. Nat’l Bank, 652 F.2d 1176, 1184, 1187-88 (4th Cir. 1981) (noting the Commission’s “broad enforcement powers” under § 706; holding that the EEOC had proved a “pattern or practice of discrimination” under Teamsters); EEOC v. Monarch Mach. Tool Co., 737 F.2d 1444, 1446-49 (6th Cir. 1980); see also EEOC v. St. Louis-S.F. Ry. Co., 743 F.2d 739, 743-44 (10th Cir. 1984) (holding that, after General Telephone, the Commission could seek class-wide relief under § 706).

Finally, Bass Pro asserts that the panel decision “creates for the EEOC a non-existent § 706 pattern-or-practice cause of action,” Pet. 12-13, but Bass Pro’s assertion does not support en banc review. The panel permitted the Commission to use the Teamsters proof framework, which is consistent with this Court’s understanding of Teamsters as a proof method and not an independent cause of action. See Celestine v. Petroleos de Venezuella SA, 266 F.3d 343, 355 (5th Cir. 2001) (recognizing Teamsters “is really ‘merely another method by which disparate treatment can be shown’” in suit “brought either by the government or as a class action”).

Conclusion

For the foregoing reasons, the Petition should be denied.

Respectfully submitted,

P. DAVID LOPEZ

General Counsel

JENNIFER S. GOLDSTEIN Associate General Counsel

MARGO PAVE

Assistant General Counsel

s/ James M. Tucker

JAMES M. TUCKER

Attorney

EQUAL EMPLOYMENT

OPPORTUNITY COMMISSION

Office of General Counsel

131 M St. NE, Rm. 5NW10P

Washington, D.C. 20507

(202) 663-4870

James.Tucker@EEOC.gov

[1] Bass Pro misleadingly states that the EEOC did not identify “even one actual victim of hiring discrimination” during its administrative process. Pet. 1. In fact, the Commission informed Bass Pro during conciliation that it had “identified approximately 100 specific individuals who were alleged victims of discrimination,” and Bass Pro later acknowledged as much in a district court filing. ROA.6092, 6099.

[2] Bass Pro cites Castano v. American Tobacco Co., 84 F.3d 734, 737-38, 746-48 (5th Cir. 1996), but Castano’s observation of undue settlement pressure was rendered in the context of Rule 23 certification of a private class action against tobacco companies where the suit alleged millions of potential class members—“all nicotine dependent persons in the United States,” based on a “new theory of liability,” and rife with “extensive manageability problems with this class” including “difficult choice of law determinations, subclassing of eight claims with variations in state law, Erie guesses, notice to millions of class members, further subclassing to take account of transient plaintiffs, and the difficult procedure for determining who is nicotine-dependent.” None of these factors (including Rule 23 issues) are present here.

[3] In Allison, for example, this Court held that the district court had not abused its discretion in denying class certification under Rule 23 because “[t]he predominance of individual-specific issues relating to the plaintiffs’ claims for compensatory and punitive damages . . . detract[ed] from the superiority of the class action device in resolving these claims.” 151 F.3d at 419; see also id. at 414 (predomination requirement of Rule 23 “serves to protect the rights of class members regarding their monetary interests”).

[4] In a decision issued after Allison was decided, the Supreme Court held that the question of liability for punitive damages focuses “solely on an employer’s state of mind” when it violated the statute. Kolstad v. Am. Dental Ass’n, 527 U.S. 526, 535 (1999).

[5] Bass Pro also cited as supporting authority Smith v. Texaco, Inc., 263 F.3d 394, 410 (5th Cir. 2001). Pet. 11 n.3. However, Smith recognizes that “[t]he court [in Hardin] remarked that it was not deciding that issues of intent, of compensatory damages, and of punitive damages are inseparable as a matter of law in all cases.” 263 F.3d at 410.