As we discussed in the introductory article in this series, OFCCP has argued that certain of the Supreme Court’s pattern or practice holdings in Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338 (2011), do not apply because the Agency is arguably not subject to the Rule 23 requirement of demonstrating that “there are questions of law or fact common to the class.” OFCCP’s argument is that the pertinent holdings of Dukes apply only to whether there are such questions of law or fact common to the class and not to whether there was “‘significant proof’ that Wal-Mart ‘operated under a general policy of discrimination.'” 564 U.S. at 353.
The logical starting point for evaluating OFCCP’s position should be the Supreme Court’s discussion in Dukes. To begin, the Court noted that, “[i]n a pattern-or-practice case, the plaintiff tries to ‘establish by a preponderance of the evidence that . . . discrimination was the company’s standard operating procedure[,] the regular rather than the unusual practice.’ Teamsters v. United States, 431 U. S. 324, 358 (1977); see also Franks v. Bowman Transp. Co., 424 U. S. 747, 772 (1976).” Dukes, 564 U.S. at 352 n. 7. To be sure, OFCCP has agreed that its compensation discrimination cases typically involve allegations of a pattern or practice of pay discrimination. See, e.g., Interpreting Nondiscrimination Requirements of Executive Order 11246 With Respect to Systemic Compensation Discrimination, 71 Fed. Reg. at 35,135 (June 16, 2006).
In Dukes, the Court explained the plaintiffs’ pattern or practice allegations:
The basic theory of their case is that a strong and uniform “corporate culture” permits bias against women to infect, perhaps subconsciously, the discretionary decision-making of each one of Wal-Mart’s thousands of managers—thereby making every woman at the company the victim of one common discriminatory practice.
Dukes, 564 U.S. at 345.
The Court related the plaintiffs’ “basic theory” of the case to their specific claims under Title VII:
These plaintiffs, respondents here, do not allege that Wal-Mart has any express corporate policy against the advancement of women. Rather, they claim that their local managers’ discretion over pay and promotions is exercised disproportionately in favor of men, leading to an unlawful disparate impact on female employees, see 42 U. S. C. §2000e–2(k). And, respondents say, because Wal-Mart is aware of this effect, its refusal to cabin its managers’ authority amounts to disparate treatment, see §2000e–2(a).
Dukes, 564 U.S. at 344-45.
After reviewing the plaintiffs’ theory and claims, the Court turned to examine the evidence presented by the plaintiffs. Justice Scalia’s reasoning for why the evidence presented by the plaintiffs in Dukes was insufficient involved its failure to support a reasonable inference that Wal-Mart “operated under a general policy of discrimination.” 564 U.S. at 353-59. That is the same standard for whether the evidence establishes a pattern or practice of discrimination, i.e., a showing that “discrimination was the company’s standard operating procedure[,] the regular rather than the unusual practice.” Teamsters, 431 U. S. at 258; see also Interpreting Nondiscrimination Requirements of Executive Order 11246 With Respect to Systemic Compensation Discrimination, 71 Fed. Reg. at 35,135 (“In a pattern or practice case, the plaintiffs’ ‘initial burden is to demonstrate that unlawful discrimination has been a regular procedure or policy followed by an employer * * *.’ Teamsters, 431 U.S. at 360.”); Notice of Rescission, 78 Fed. Reg. at 13,512 (“Plaintiffs must show that discrimination in the workplace manifests as the company’s ‘standard operating procedure.’ International Brotherhood of Teamsters v. United States, 431 U.S. 324, 336 (1977); see also Franks v. Bowman Transportation Co., 424 U.S. 747, 772 (1976)”).
In Dukes, the plaintiffs offered three kinds of evidentiary submissions in an attempt to establish that Wal-Mart “operated under a general policy of discrimination.” Justice Scalia addressed each in turn. First, plaintiffs offered the testimony of a social science expert, Dr. William Bielby, who concluded that Wal-Mart’s employment policies provided managers too much discretion to make employment decisions that could be infected with discriminatory bias. Justice Scalia explained that this evidence was insufficient to support any inference that Wal-Mart “operated under a general policy of discrimination”:
[W]hether 0.5 percent or 95 percent of the employment decisions at Wal-Mart might be determined by stereotyped thinking is the essential question on which respondents’ theory of commonality depends. If Bielby admittedly has no answer to that question, we can safely disregard what he has to say. It is worlds away from “significant proof” that Wal-Mart “operated under a general policy of discrimination.”
564 U.S. at 354-55.
Second, plaintiffs offered evidence of statistical disparities in pay and promotions based on analyses aggregated by region or nationwide. Again, Justice Scalia explained that this evidence was insufficient to provide a reasonable inference that Wal-Mart “operated under a general policy of discrimination”:
A similar failure of inference arises here. As Judge Ikuta observed in her dissent, “[i]nformation about disparities at the regional and national level does not establish the existence of disparities at individual stores, let alone raise the inference that a company-wide policy of discrimination is implemented by discretionary decisions at the store and district level.”
564 U.S. at 356-57.
Third, plaintiffs offered anecdotal evidence of discrimination. Justice Scalia concluded that the evidence did not raise a reasonable inference that Wal-Mart “operated under a general policy of discrimination”:
Respondents’ anecdotal evidence suffers from the same defects, and in addition is too weak to raise any inference that all the individual, discretionary personnel decisions are discriminatory. In Teamsters v. United States, 431 U. S. 324 (1977), in addition to substantial statistical evidence of company-wide discrimination, the Government (as plaintiff) produced about 40 specific accounts of racial discrimination from particular individuals . . . The 40 anecdotes thus represented roughly one account for every eight members of the class.
Here, by contrast, respondents filed some 120 affidavits reporting experiences of discrimination—about 1 for every 12,500 class members—relating to only some 235 out of Wal-Mart’s 3,400 stores. 603 F. 3d, at 634 (Ikuta, J., dissenting). . . .Even if every single one of these accounts is true, that would not demonstrate that the entire company “operate[s] under a general policy of discrimination . . .”
A discrimination claimant is free to supply as few anecdotes as he wishes. But when the claim is that a company operates under a general policy of discrimination, a few anecdotes selected from literally millions of employment decisions prove nothing at all.
564 U.S. at 358 & n. 9.
The Court concluded: “[b]ecause respondents provide no convincing proof of a companywide discriminatory pay and promotion policy, we have concluded that they have not established the existence of any common question.” Id. at 359.
Ultimately, the Court addressed our question rather directly: “[i]n this case, proof of commonality necessarily overlaps with respondent’s merits contention that Wal-Mart engages in a pattern or practice of discrimination.” 564 U.S. at 352 (emphasis in original). Overlap indeed. The Court examined the same question, whether there was “substantial proof of a general policy of discrimination,” which cannot be differentiated from the question whether discrimination was the employer’s “standard operating procedure.” And the Court examined the same proofs.1 The evidence the Court considered involved statistical (regression) analyses and anecdotal evidence both central proofs typically offered to demonstrate a pattern or practice of discrimination. See Teamsters, 431 U.S. at 338; Bazemore v. Friday, 478 U.S. 385, 399 (1986). The Court concluded that the plaintiffs’ evidence failed to raise a reasonable inference that Wal-Mart operated under a general policy of discrimination.
In light of the Court’s conclusive examination, is it possible that EEOC could pursue the exact same allegations as the plaintiffs in Dukes, rely on the same proofs, and prevail in that pattern or practice case? Plainly not. The Court determined that those proofs did not reasonably create an inference that Wal-Mart “operated under a general policy of discrimination.” Thus, the order of explanation in Dukes began with a failure of inference about a “general policy of discrimination” and ended with a failure in commonality.
Indeed, it is unclear how an otherwise meritorious pattern or practice allegation, substantiated with adequate evidence, might fail to raise a common question of law or fact.2 As the Court has explained, “racial discrimination is, by definition, class discrimination.” General Tel. Co. v. Falcon, 457 U.S. 147, 157 (1982). As in Dukes, the plaintiffs may fail to raise a common question of fact or law because the evidence fails to establish a reasonable inference of a general policy of discrimination. See Falcon, 457 U.S. at 157 (“Conceptually, there is a wide gap between (a) an individual’s claim that he has been denied a promotion on discriminatory grounds and his otherwise unsupported allegation that the company has a policy of discrimination, and (b) the existence of a class of persons who have suffered the same injury as that individual, such that the individual’s claim and the class claims will share common questions of law or fact . . . ” (emphasis added)).
But the possible divergence, i.e., an adequately supported and otherwise meritorious pattern or practice case deemed not to present a common question of law or fact, would be doubly surprising since the pattern or practice method of proof recognized in Teamsters found its origins in a private class action context:
The parties here use the term “pattern or practice” to refer not to an element of a § 2000e-6 claim, but to the method of proof that the Supreme Court endorsed in Teamsters for the adjudication of such claims. This method of proof, however, originated in the class action context, in Franks v. Bowman Transportation Co., 424 U.S. 747, 96 S.Ct. 1251, 47 L.Ed.2d 444 (1976). The Supreme Court in Franks determined that once the private plaintiffs in the class action there “carried their burden of demonstrating the existence of a discriminatory hiring pattern and practice by the [employer] …, the burden [was] upon [the employer] to prove that individuals who reappl[ied] were not in fact victims of previous hiring discrimination.” Id. at 772, 96 S.Ct. 1251. The Court in Franks used the phrase “pattern and practice” to refer to the common question of fact (whether the employer had engaged in a practice of discriminatory hiring) to be litigated by class plaintiffs, and apparently viewed its holding as no more than an application of McDonnell Douglas’ burden-shifting framework in the class-action context. See Franks, 424 U.S. at 773, 96 S.Ct. 1251 (citing McDonnell Douglas, 411 U.S. 792, 93 S.Ct. 1817).
The Teamsters Court thereafter determined that the Franks burden-shifting framework for certain class actions should also apply to government “pattern or practice” suits brought under § 2000e-6:
- Although not all class actions will necessarily follow the Franks model, the nature of a [§ 2000e-6] pattern-or-practice suit brings it squarely within our holding in Franks. The plaintiff in a pattern-or-practice action is the Government, and its initial burden is to demonstrate that unlawful discrimination has been a regular procedure or policy followed by an employer or group of employers. At the initial, liability stage of a pattern-or-practice suit the Government is not required to offer evidence that each person for whom it will ultimately seek relief was a victim of the employer’s discriminatory policy.
Chin v. Port Authority of New York and New Jersey, 685 F. 3d 135, 148 (2d Cir. 2012).
We must conclude that the Supreme Court made rulings on substantive pattern or practice issues in Dukes, and, in particular, the Court examined whether typical evidentiary submissions were suitably structured to permit a reasonable inference of a discriminatory pattern or practice. These rulings provide significant guardrails for pattern or practice cases, whether raised in a class action or by OFCCP.
1. Had the Court agreed that the class could be certified, would there have been any serious doubt about whether the plaintiffs would have offered similar if not identical proofs in an attempt to establish a pattern or practice of discrimination?
2. Of course, the plaintiff could seek to represent a class that is not reasonably within the scope of the significant proof of a pattern or practice, or the action may not be suitable for class treatment based on the other requirements of Rule 23 and Article III.