Equal Employment Opportunity Commission v. Gard Corp.

Citations: 795 F. Supp. 1066; 1992 U.S. Dist. LEXIS 10703; 59 Fair Empl. Prac. Cas. (BNA) 428Docket: No. 92-2023-L

Court: District Court, D. Kansas; June 19, 1992; Federal District Court

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The employment discrimination case involves the Equal Employment Opportunity Commission (EEOC) representing Wilhelmine Bailey and other African-American individuals claiming race-based denial of permanent employment by Gard Corporation (Gard). The court is currently addressing Gard's motion to dismiss the class claims and the plaintiff's motion to modify the scheduling order, while a third-party motion to dismiss by Tall Services, Inc. remains pending. The court denied Gard's motion to dismiss, converting it to a motion for summary judgment due to the introduction of external materials. The plaintiff acknowledged this transformation in their response. The court noted that when evaluating a summary judgment motion, all evidence is viewed favorably towards the nonmoving party, and the burden lies with the moving party to demonstrate an absence of evidence supporting the nonmoving party's claims. If met, the burden shifts to the nonmoving party to present specific facts showing genuine issues for trial, rather than relying solely on pleadings.

Bailey filed a charge with the EEOC alleging racial discrimination in employment under Title VII of the Civil Rights Act, and she later amended her charge to include retaliation claims after the EEOC's investigation began in 1988. Although the EEOC found reasonable cause for retaliation in 1990, it did not address the discrimination claim or the class-wide allegations, which the Commission now attributes to administrative oversight. Following a failed conciliation effort for the retaliation claim in early 1991, it appears Gard was initially without legal representation.

Four days after the defendant's new counsel requested to resume conciliation efforts, the EEOC agreed and attempted to negotiate a settlement regarding Ms. Bailey’s claims. Upon realizing that class-based and hiring charges were omitted from its initial reasonable cause determination, the EEOC rescinded that determination on June 14, 1991, and issued a new letter asserting that the defendant had unlawfully denied Ms. Bailey permanent employment and discriminated against African-Americans as a class. A proposed conciliation agreement was sent to the defendant’s attorney on July 17, 1991, which included terms for both Ms. Bailey’s individual claims and the class claims. The defendant rejected the settlement on July 30, 1991, making a counter-offer for Ms. Bailey's claim but not addressing the class claims. The EEOC subsequently filed this action on January 10, 1992.

The defendant, Gard, argues that the inclusion of class claims in the amended reasonable cause letter constituted unfair surprise, requesting dismissal of these claims based on laches and failure to conciliate. Gard contends it was prejudiced by the delay, which affected the availability of evidence and witnesses. However, the EEOC's authority to enforce Title VII includes pursuing claims developed during a reasonable investigation of the original charge and requires compliance with conciliation procedures. The court affirmed the EEOC's right to amend its reasonable cause determination and pursue class-based claims, noting that no statutory limitations restrict the EEOC from changing its prosecution strategy after acquiring jurisdiction. Gard's claim that the EEOC failed to conciliate the class claims was also addressed, emphasizing the EEOC's obligation to engage in good faith conciliation efforts prior to litigation.

The Commission is not required to continue conciliation efforts after an employer rejects its offer. In this case, the EEOC attempted to negotiate with Gard regarding Ms. Bailey's claims and subsequently included class claims in a second conciliation proposal. Gard rejected the offer for Bailey’s claims and counter-offered without addressing the class claims, thus relieving the EEOC of any further conciliation obligation. The case cites previous rulings affirming that dismissal for failure to conciliate is inappropriate when an employer does not engage seriously in counter-proposals. Gard also argues that the EEOC is barred from asserting class claims due to laches, which requires showing a lack of diligence and resulting prejudice. Courts must consider the EEOC's role in promoting public interest and the need for effective investigation into discrimination claims. The court found that Gard did not demonstrate, as a matter of law, that the class claims were barred by laches. Disputes exist regarding the responsibility for delay in the EEOC's investigation, and a three-year delay alone does not justify a laches claim. Gard had prior notice of EEOC concerns regarding its employment practices and was given nearly seven months to prepare a defense after the amended determination. Furthermore, Gard failed to prove actual prejudice from the EEOC's actions, as general claims of lost evidence or witness recollection do not suffice to establish prejudice necessary for laches.

The court in EEOC v. Radiator Specialty Co. preserved the defendant's laches defense for trial and denied the defendant’s motion to dismiss class claims. The court granted the plaintiff’s request to modify the scheduling order, providing approximately 90 additional days for compliance. Key deadlines established include: completion of discovery and filing of nondispositive motions by December 7, 1992; service of interrogatories and requests for production by August 3, 1992; plaintiff’s expert witness disclosure by July 6, 1992; defendant’s expert witness disclosure by August 17, 1992; third party defendant's expert witness disclosure by October 1, 1992; submission of preliminary witness and exhibit lists by August 17, 1992; final lists by October 26, 1992; a final pretrial conference on January 4, 1993, at 4:30 p.m.; submission of proposed pretrial orders by December 21, 1992; and filing of dispositive motions by February 1, 1993. The trial is set to begin on June 1, 1993. The court ordered the clerk to notify all parties of these modifications.