EEOC v. Bay Ridge Toyota, Inc.

Citations: 327 F. Supp. 2d 167; 59 Fed. R. Serv. 3d 79; 2004 U.S. Dist. LEXIS 13276Docket: 1:03-cv-05765

Court: District Court, E.D. New York; July 15, 2004; Federal District Court

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The legal case involves the Equal Employment Opportunity Commission (EEOC) suing Bay Ridge Toyota, Inc. under Title VII of the Civil Rights Act of 1964, following a series of discrimination allegations. The lawsuit stems from a 2000 charge filed by Maria Andujar, a former employee, who claimed sexual harassment by a manager. After EEOC's investigation confirmed reasonable cause for her claims, a Conciliation Agreement was reached in January 2001, which required Bay Ridge Toyota to cease discriminatory practices, provide training on anti-discrimination laws, and report compliance to the EEOC, although the company did not admit wrongdoing.

In April 2002, another former employee, Gladys Evdaev, filed a similar charge against the same manager, which also led to an EEOC finding of reasonable cause. Despite the EEOC's attempts to conciliate Evdaev's charge, Bay Ridge Toyota declined. In 2003, Evdaev settled her claims privately. Subsequently, the EEOC filed this lawsuit on November 14, 2003, alleging that Bay Ridge Toyota violated the terms of the earlier Conciliation Agreement with Andujar. The complaint seeks permanent injunctive relief to remedy unlawful employment practices and mandates the implementation of equal employment opportunity policies for women, along with enforcement of the Conciliation Agreement. The court granted the EEOC's motion to strike several of the defendant's affirmative defenses.

Defendant's Answer includes several affirmative defenses and counterclaims, notably asserting that the EEOC lacks standing and authority to enforce the Conciliation Agreement, that the case does not fall under Title VII, that the Court lacks subject matter jurisdiction, that the plaintiff is barred by unclean hands, and that the EEOC cannot pursue the lawsuit due to a private settlement related to the Evdaev charge of discrimination. The plaintiff has moved to strike certain paragraphs of the defendant's Answer as legally insufficient.

Under Federal Rule of Civil Procedure 12(f), a court may strike insufficient defenses or irrelevant material upon motion or sua sponte. Striking a defense is warranted when it is clearly irrelevant and frivolous, thus avoiding unnecessary litigation costs. The district court has discretion over such motions, but the Second Circuit cautions that motions to strike are not favored and should only be granted if it is certain that the plaintiff would succeed regardless of any supporting facts for the defense. Furthermore, motions to strike should not resolve substantial legal questions, especially if significant discovery has not yet occurred. Courts generally prefer to treat pleadings liberally, allowing parties to present their claims at trial. To succeed in a motion to strike a defense, the plaintiff must demonstrate there are no factual or legal questions that could allow the defense to succeed and that including the defense would cause prejudice.

Subject matter jurisdiction for enforcing EEOC Title VII conciliation agreements is established through the statutory framework governing such agreements. Employees alleging discrimination must first file charges with the EEOC, which investigates and seeks to resolve the issue through conciliation if reasonable cause is found (42 U.S.C. 2000e-5(b)). If no acceptable agreement is reached within thirty days, the EEOC can file a Title VII action in federal court (42 U.S.C. 2000e-5(f)(1)). In the case of Maria Andujar, a successful conciliation agreement was reached, which is a voluntary contract waiving the right to sue concerning the alleged discrimination (EEOC v. Liberty Trucking Co., 695 F.2d 1038, 1041). The defendant claims that enforcement of the agreement does not arise under Title VII and challenges the court's jurisdiction. However, established case law confirms that enforcement actions of Title VII conciliation agreements do fall under federal jurisdiction (42 U.S.C. 2000e-5(f)(3)). Courts emphasize that allowing enforcement of these agreements aligns with federal policy promoting conciliation (Liberty Trucking Co., 695 F.2d at 1038). Consequently, the EEOC's suit to enforce the Andujar Conciliation Agreement is properly brought under Title VII, and the court has jurisdiction to hear the case.

Defendant contends that the EEOC lacks standing to pursue the case because it was not a party to the Andujar Conciliation Agreement. This argument is refuted by established law and legislative history, which affirm that promoting voluntary compliance with Title VII is a fundamental function of the EEOC. The agreement itself, titled "In the Matter of EEOC and Charging Party: Maria Andujar and Respondent: Bay Ridge Toyota," was printed on EEOC letterhead and signed by the District Director, confirming the EEOC's involvement. Denying the EEOC's authority to enforce this agreement contradicts Congressional intent, as noted by the Fifth Circuit, which emphasizes the importance of such agreements in facilitating compliance and resolving discrimination claims effectively.

Defendant also claims the EEOC has "unclean hands" for publishing the Conciliation Agreement in the lawsuit. This defense is flawed because unclean hands and inequitable conduct apply only when there is a direct connection between the alleged misconduct and the suit's basis. Since the conduct in question occurred during litigation rather than the action's accrual, it cannot substantiate an equitable defense. Furthermore, the Conciliation Agreement allows for its enforcement in court and as evidence in related proceedings, undermining the unclean hands defense.

Regarding the Evdaev charge, the defendant argues that its private settlement precludes the EEOC from taking action. However, the cited case, EEOC v. Waffle House, confirms that while arbitration agreements can affect the EEOC's claims, this situation differs as it does not seek victim-specific relief.

The EEOC has an independent right to pursue actions regardless of the charging party's status, as established in case law (Gen. Tel. Co. v. EEOC, 446 U.S. 318). Title VII allows the EEOC to initiate civil actions against private employers to enforce public interests and enhance the enforcement of individual rights, even if the employee has settled privately. This is crucial to prevent employers from evading investigations by settling with employees. The EEOC's focus is on seeking injunctive relief rather than victim-specific remedies, emphasizing its role in protecting public interest. Legal precedents confirm that the EEOC can act even when employees have binding arbitration agreements, and a settlement between an employee and their employer does not negate the EEOC's authority to address discriminatory practices. The court finds no legal or factual basis for the defendant to claim that the EEOC lacks standing or jurisdiction to proceed, nor is the EEOC barred by the unclean hands doctrine. Allowing these defenses would unnecessarily complicate the case. Consequently, several defenses listed in the defendant's Answer are to be stricken.

Defendant's Answer asserts multiple affirmative defenses regarding jurisdiction and the EEOC's standing. Key points include: 

1. **Subject Matter Jurisdiction**: The defendant denies that the Court has subject matter jurisdiction under 42 U.S.C. 2000e-5(f)(1) and claims the Court lacks jurisdiction over one or more claims in the Complaint (first separate defense). Additionally, it argues that the suit does not aim to address unlawful employment practices, as most relief sought falls outside the Act's scope (fifth separate defense), and some claims are not brought "under" Title VII (fifteenth separate defense).

2. **EEOC's Standing and Authority**: The defendant contends that the EEOC lacks standing to initiate this action (second separate defense), has no statutory authority for the claims (third separate defense), and is not a party to the relevant Agreement, thus cannot sue for its enforcement (thirteenth separate defense). Furthermore, it asserts that the EEOC cannot rely on the Evdaev charge after settling all claims with Ms. Evdaev, who executed a binding release (ninth and eighteenth separate defenses).

3. **Equitable Relief**: The defendant argues that the Plaintiff is not entitled to equitable relief due to "unclean hands" for violating the confidentiality of the Agreement (sixth and nineteenth separate defenses). 

Overall, the defendant's Answer challenges the Court's jurisdiction, the EEOC's standing, and raises issues regarding the Plaintiff's entitlement to relief based on the conduct related to the Agreement.