
The Supreme Court’s ruling was issued in the case of McLane Co., Inc. v. Equal Employment
Opportunity Commission. The McLane case arose out of McLane’s termination
of Damiana Ochoa for her failure to pass a mandatory physical abilities test
upon her return from maternity leave. Ochoa subsequently filed a charge of sex discrimination
with the EEOC. As part of its investigation, the EEOC asked McLane to produce information
regarding the physical abilities test and employees who had been asked to take
the test. In responding, McLane provided de-identified information about the requested
employees’ gender, position, test score, and the reason each employee had been
asked to take the test. McLane refused, however, to provide so-called “pedigree
information,” e.g. the names, social security numbers, addresses, and telephone
numbers of its employees. In response, the EEOC expanded the scope of its
requests to McLane’s nationwide operations and subpoenaed McLane for the pedigree
information. After McLane again refused to provide the requested pedigree
information, maintaining the request was overbroad and unduly burdensome, the
EEOC filed suit in an Arizona-based federal district court seeking enforcement
of its subpoena.
The Arizona federal district court denied enforcement of the
EEOC subpoena. It held that the EEOC’s primary motive in seeking pedigree
information was related to Americans with Disabilities Act concerns and that,
because Ochoa’s charge was for sex discrimination under Title VII, the subpoena
was overbroad. On appeal, the Ninth Circuit Court of Appeals reversed under a de novo standard of review that requires
no deference to the legal conclusions of the lower court. The Ninth Circuit’s
use of de novo review stands in
contrast with the approach taken by numerous other federal appellate courts
that have held that the abuse of discretion standard applies.
McLane appealed the Ninth Circuit’s ruling to the Supreme
Court, which held last week that an abuse of discretion – not de novo – standard of review applies
when an appellate court is reviewing a trial court’s ruling on a challenge to
an EEOC subpoena. In landing on the abuse of discretion standard, the court
noted that: (1) there is a longstanding practice in federal appellate courts of
engaging in a deferential review of administrative subpoenas; and (2) trial
courts are better positioned than appellate courts to determine if an
administrative subpoena seeks relevant information in light of the specific
facts of a case. Accordingly, the court ruled that, unless there is evidence
that a trial court arbitrarily exercised its discretion or made a clear legal
error, the trial court’s decision should stand.
While the Supreme Court’s McLane ruling favors employers, the Supreme Court did reiterate that
the EEOC enjoys broad subpoena power, stating that “the established rule [is] that
the term ‘relevant’ be understood ‘generously’ to permit the EEOC ‘access to
virtually any material that might cast light on the allegations against the
employer.” The court’s decision also provides, however, that a trial court
should be cognizant of the EEOC’s broad subpoena power, but does not have to
defer to the EEOC’s view on relevancy.
The McLane ruling will
make it more difficult for a district court’s decision on an EEOC subpoena to
be overturned on appeal. It also suggests that an employer challenging an EEOC
subpoena will likely have a better chance of obtaining a favorable ruling from
the district court, rather than on appeal. Because district courts still must recognize
the extensive subpoena power of the EEOC, employers wishing to challenge an
EEOC subpoena must continue to be prepared to present compelling reasons why
the subpoena is invalid.
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