Supreme Court Rejects Employer-Friendly Formulation of "Cat's Paw" Defense
In its March 1, 2011 ruling in Staub v. Proctor Hospital, No. 09-400, the United States Supreme Court rejected an employer-friendly formulation of the so-called "cat's paw" defense in the context of a claim under the United Services Employment and Reemployment Rights Act of 1994 ("USERRA"), 38 U.S.C. § 4311 et seq., a federal law designed to prohibit employment discrimination against current or former members of the United States armed forces. In an opinion for six Justices written by Justice Scalia, the Court reversed a ruling by the Seventh Circuit and held that if the ultimate decision-maker relies on reports of biased lower-level supervisors, those reports can be a proximate cause of the ultimate employment action, for which the employer is liable under USERRA.
Vincent Staub was employed as an angiography technician with Proctor Hospital ("Proctor") until his termination in 2004. While employed with Proctor, Staub, a veteran member of the United States Army Reserve, requested weekends off in order to attend mandatory reserve trainings. However, his immediate supervisor, Janice Mulally, and Mulally's superior, Michael Korenchuk, were allegedly hostile to his military obligations, often scheduling him for additional shifts without notice, in order to "pay back" Proctor for his requested time off. In January 2004, Mulally issued Staub a "Corrective Action" disciplinary warning for his allegedly frequent absences from his work station. A complaint from Staub's coworker on April 2, 2004 led to a second corrective plan to deal with Staub's absenteeism. Three weeks later, Korenchuk reported that Staub had left his desk without informing his supervisor, in violation of the 2004 Corrective Action. Staub was then terminated by the vice president of human resources, Linda Buck, for purportedly violating the 2004 Corrective Action. Following the termination, Staub filed a grievance alleging that the Corrective Action and later discipline were based on a fabrication due to Mulally's hostility toward his military reserve obligations. Buck did not interview Mulally regarding this grievance but instead adhered to her original decision to terminate Staub's employment. Staub filed suit in the federal district court in Illinois against the hospital under USERRA, alleging that his discharge was motivated by hostility to his obligations as a military reservist.
Following a trial, the jury found that Staub's "military status was a motivating factor in [Proctor's] decision to discharge him," in violation of the USERRA. On appeal, the Seventh Circuit reversed, holding that Proctor was entitled to judgment as a matter of law. The Seventh Circuit suggested that Staub's claim was premised on the "cat's paw" theory, that Staub was attempting to hold his employer liable for the discriminatory animus of supervisors who were not charged with making the ultimate employment decision to discharge him. In the appeals court's view, only the unlawful intent of the ultimate decision-maker could be considered in employment discrimination suits unless that decision-maker was under the "singular influence" of biased lower-level supervisors. In Staub's case, Buck conducted her own "independent investigation" and was thus not under the "singular influence" of either Mulally or Korenchuk when she terminated him.
The Supreme Court granted certiorari to determine under what circumstances an employer may be held liable for the unlawful intent of its employees who caused or influenced, but did not make, an ultimate employment decision.
Justice Scalia delivered the majority opinion, joined by Chief Justice Roberts and Justices Kennedy, Ginsburg, Breyer, and Sotomayor. Justice Alito, joined by Justice Thomas, filed a concurring opinion in the judgment. Justice Kagan did not participate in the case. In the majority's view, the Seventh Circuit's "singular influence" standard was in error. As long as the ultimate decision-maker (Buck) was relying on, or influenced by, the reports of the biased lower-level supervisors (Mulally and Korenchuk) made in the course of their employment, it did not matter whether the latter exercised a "singular influence" over Buck or that Buck performed an "independent investigation" before reaching the challenged decision. Both Buck's decision and the supervisors' reports Buck relied upon could be multiple causes of the ultimate discharge decision, and hence were "motivating factors" under USERRA. According to the Court, "[s]o long as the agent intends, for discriminatory reasons, that the adverse action occur, he has the scienter required to be liable under USERRA." A final or ultimate determination from a decision-maker, the Court explained, does not "prevent the earlier agent's action … from being the proximate cause of the harm."
Although Staub plainly rejects the pro-employer "singular influence" standard of the Seventh Circuit, the Court's opinion does suggest some limiting factors.
First, the Court's reasoning applies only where the lower-level supervisors were acting within the scope of their employment when they made their reports and fashioned a disciplinary plan for Staub. If Mulally and Korenchuk were simply coworkers or supervisors from a different department not responsible for Staub, a different analysis would be called for to determine whether their discriminatory input was a causal factor in an ultimate decision by Buck.
Second, although the majority rejects a hard-and-fast "independent investigation" defense, the opinion states that "if the employer's investigation results in an adverse action for reasons unrelated to the supervisor's original biased action…, then the employer will not be liable." What is key is that the ultimate decision-maker determines that "the adverse action was, apart from the supervisor's recommendation, entirely justified." Under USERRA, the burden of persuasion is on the employer to show that it would have reached the same decision irrespective of the biased supervisor's part.
Third, if the lower-level supervisors do not intend for their report to result in an adverse ultimate decision, their bias may, in particular circumstances, not be viewed as a proximate cause.
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In addition to clarifying the Court's view of the applicable tort causation principles informing federal antidiscrimination law, the opinion highlights the importance of careful personnel and performance-review procedures when discharging employees who fall within federal or state protected classes.
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Alison B. Marshall
Sarah B. McClure
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