Given claws by Staub, ‘cat’s paw’ reaches into state courts

In its March 2011 decision in Staub v.  Proctor Hospital, 131 S. Ct. 1186 (2011), the U.S. Supreme Court increased the bank of evidence that employment plaintiffs may rely upon when proving discrimination or retaliation cases. The court endorsed the “cat’s paw” theory of liability, holding that an employer can be liable for discrimination or retaliation if the employer acts innocently but based on input from a biased supervisor.

The term “cat’s paw” comes from one of Aesop’s fables, in which a monkey flatters a cat into extracting roasting chestnuts from  a fire — in other words, using the cat’s paw to do that which the monkey could not or did not want to do.

In Staub a hospital vice president fired a U.S. Army reservist who worked as an angiography technician. While the VP herself had no anti-military bias, she relied partly on disputed reports and warnings from the reservist’s supervisors, who were hostile to his Army obligations.

The reservist sued, claiming a breach of the Uniformed Services Employment and Reemployment Rights Act, which bans workplace discrimination based on military service.

In an 8-0 decision, the Supreme Court ruled that  the  VP’s  actions  could  indeed violate USERRA. In the main opinion, Justice Antonin Scalia ruled that employers may escape liability as a matter of law only if the ultimate  decision-maker  has  conducted   an investigation and acted “for reasons unrelated to the supervisor’s original biased action” — a fact that is the employer’s burden to establish.

Otherwise, Justice Scalia said, a court must assess whether the original biased action was intended to cause an adverse employment action and, if so, whether it was “a proximate cause” of the action under litigation — generally a matter for a jury.

Justice Scalia indicated that the same cat’s-paw standard would apply to any anti- discrimination statute similar to USERRA, including Title VII of the Civil Rights Act of 1964.

Since the March 2011 decision, Staub has been cited in 365 cases, 232 of which cite directly to the “cat’s paw” analogy. Of those 232 cases, 16 are from state courts and the rest from federal courts. State law claims have also been litigated in federal courts, alongside claims based on federal laws. Staub’s impact has reached through various federal statutes and is moving into state statutes as well.

Over time, Staub’s influence and reasoning will continue to spread across the nation into state and local statutes.

The Jackson Case

In Edgewood Management Corp. v. Jackson, 212 Md. App. 177 (2013), the Maryland Court of Special Appeals held that Staub’s cat’s paw theory applied to Montgomery County’s anti-discrimination statutes, which are authorized by Section 20–1202 of the State Government Article in the Maryland state code.

At the time of her resignation in March 2010, Donna Jackson had worked for Edgewood since 1979 in multiple positions. In September 2009, Arturo Reyes became Jackson’s direct supervisor. In December 2009, Jackson reported her subordinate’s complaint of gender discrimination, against Reyes, to Reyes’ supervisor, Norman Azouqha.

Within a month, Jackson said, Reyes began retaliating against her, first proposing a disciplinary memo and recommending her termination. Azouqha issued Jackson a disciplinary action memorandum instead Jan. 25, 2010. Jackson promptly  rebutted the criticisms in the memo and questioned whether there were “other reasons as to why Mr. Reyes found it necessary to put in writing these accusations.”

Reyes continued to encourage Azouqha to terminate  Jackson’s  employment  and also planned her transfer to another location with a much longer commute. On Feb. 24, 2010, Reyes rejected Jackson’s rebuttal of the disciplinary memo and informed her of the transfer and a salary reduction. The next day, Jackson submitted her resignation. In her resignation letter, Jackson stated that she believed the transfer was retaliatory.

Jackson filed a complaint of retaliation under Md. Code Ann. State Gov’t § 20–1202, asserting a violation of Section 27–19(c) of the Montgomery County Code for retaliation after opposing gender discrimination. After a trial on Jackson’s retaliation claims, the jury awarded her a $650,000 verdict.  Edgewood appealed, arguing that Jackson’s evidence at trial was insufficient to sustain her retaliation claim. The Court of Special Appeals denied Edgewood’s appeal and reinstated the jury’s verdict.

Edgewood  argued  that  Jackson  could  not state a retaliation claim because Scott Jones, a regional vice president, was the person who approved Jackson’s transfer and salary decrease and did not have knowledge of Jackson’s report at the time.

The Jackson court took notice of the Staub holding, which considered claims brought under Title VII of the Civil Rights Act of 1964.

“‘[I]f a supervisor performs an act motivated by [discriminatory] animus that is intended by the supervisor to cause an adverse employment action, and if that act is a proximate cause of the ultimate employment action,’ then the employer may be held liable,” The court said. Edgewood, 212 Md. App. at 204-05, citing Staub, 131 S. Ct. at 1194 (footnote omitted). The Jackson court also noted that the Staub decision supported a finding that:

if a supervisor submits a biased report urging an adverse employment action, even if the decision-maker conducts an independent investigation in response to the report and concludes that termination is justified, an employee still may show that the biased report was the proximate cause of the  adverse employment action if it was one of many factors considered by the decision-maker.

Edgewood, 212 Md. App. at 205, citing Staub, 131 S. Ct. at 1193.

Thus, despite Reyes’ claims that Jackson had performance deficiencies, his actions were based in retaliatory intent and thus supported Jackson’s legal claims of retaliation.

Other Courts Applying Staub

The U.S. District Court for the District of Maryland has confirmed its commitment to applying the Staub and  Jackson  decisions to state law claims. See Allen v. Dorchester County, Md., 2013 WL 5442415 (D. Md. Sept. 30, 2013) (same standards apply to race discrimination claims under state law as under Title VII).

Similarly, Ohio state courts have applied the Staub standard to its antidiscrimination law. See Smith v. Ohio Dep’t of Pub. Safety, 997 N.E.2d 597 (Ohio Ct. App. Sept. 26,     2013).

Willie Smith Jr., who is Black, worked as a state trooper from October 1998 through October 2009. In June 1999 he began working with Joseph Dragovich, who frequently criticized Smith’s work. Smith was initially terminated in June 2000, but was reinstated after a union grievance. Upon his reinstatement, Smith was assigned to meet with Dragovich for policy and procedure updates. He said Dragovich was very hostile to him during that meeting and continued to criticize his performance over the next several years.

In July 2006, Smith met with Dragovich and other leadership and stated that Dragovich was racially biased. Smith subsequently filed a charge of discrimination and retaliation against the Department of Public Safety under Title VII and Ohio law. Alleging performance deficiencies, the department assigned Dragovich to investigate and subsequently discharged Smith. Smith then filed a claim of discrimination and retaliation under Title VII and state law. After a bench trial, the court dismissed Smith’s claims, finding that he could not establish a prima facie case and could not prove that the defendants discharged him for retaliatory reasons.

Smith appealed, arguing that the trial court failed to consider and apply the cat’s paw theory of liability. The Smith  court  noted the differences in the standards of causation in Uniform USERRA  claims  (which  were  the underlying claims in  Staub)  and  Title  VII and/or claims under Ohio state law for retaliation: The former has a “motivating factor” standard and the latter has a “but for” standard.

The Smith court then held that the defendants could be liable under the cat’s paw theory if “Dragovich performed an act motivated  by  retaliatory  animus  that  was intended to cause an adverse   employment action” and “that act was the but-for cause of Smith’s discharge.” Id. at *13.

Although Dragovich had caused various personnel actions against Smith to be implemented,   the   appeals   court  refused to reverse the trial court’s dismissal of his discrimination claims  for  lack  of  evidence supporting. Although Smith did not prevail, the Smith court clearly applied Staub’s analysis to Smith’s Title VII and Ohio state law claims, without distinction.

Likewise, California courts have adopted  the Staub standard. See McGrory v. Applied Signal Tech., 212 Cal. App. 4th 1510, 1536 (Cal. Ct. App., 6th Dist. Jan. 24, 2013) (noting that the employer could be liable under the state’s Fair Employment and Housing Act for the supervisor’s discriminatory motivation if decision-makers were merely the cat’s paws of a biased investigator), citing Staub,     131

1. Ct. at 1194; Reeves v. Safeway Stores, 121 Cal. App. 4th 95, 116 (Cal. Ct. App., 6th Dist. 2004); see Young v. Dillon Companies Inc., 468 F.3d 1243, 1253 (10th Cir. 2006))..

Michigan Court of Appeals

Michigan’s courts have also applied the Staub standard to its state antidiscrimination laws. In Clum v. Jackson National Life Insurance Co., 2013 WL 5925989 (Mich. Ct. App. Nov. 5, 2013), Michael Clum, who is white, claimed that Jackson National Life had terminated his employment because of his race. A jury awarded Clum more than $1 million in damages and JNL appealed. JNL argued that it could not be held liable for Clum’s termination even if it were motivated by race-based concerns.

Clum and James DeMyers, who is Black, were colleagues for years, but did not get along, according to the appeals court opinion. On one occasion, they nearly got into a fight. DeMyers accused Clum of asking him to “take it outside.” DeMyers requested that their team leader, Mark Middaugh, report the incident to management. Middaugh reported the incident to the facilities manager, Vince Vilona, about two weeks later. Clum asked to meet with Vilona about the incident first though, and Vilona delayed that meeting.

Vilona asked Middaugh to prepare a written statement about the incident. Middaugh reported that DeMyers asked Clum if he wanted to “step outside.” Vilona and Tim Dooling, the director of facilities, reported the incident to the head of the human resources department, who later interviewed Clum, DeMyers and Middaugh. DeMyers told Bruce Raak from HR that Clum commented to him, “You need to do something about your boy.” Clum denied making the statement.

After DeMyers requested to  meet  with Raak to discuss why his complaint had not been   resolved,   Raak,   along   with   Vilona and Dooling, decided to terminate Clum’s employment for engaging in violent behavior at work. They also demoted Middaugh over his delay in reporting the incident.

In his suit under Michigan’s Civil Rights Act, Clum alleged that JNL was overly sensitive to race issues and thus treated DeMyers preferentially. Clum recounted a previous incident where the company terminated an employee for commenting that the police likely made a traffic stop based on DeMyers; race and noted that after that incident, Middaugh repeatedly stated that DeMyers “liked to play the race card.” Clum argued that Middaugh gave a skewed report to management to avoid DeMyers’ potential race discrimination claims if he were upset with the outcome of the incident. Clum also provided evidence that he had a better work record than DeMyers. DeMyers had multiple performance-related problems, but had not been disciplined. In contrast, JNL terminated Clum without giving him a final warning.

The jury awarded Clum about $1 million. The appeals court upheld Clum’s verdict, noting  that  Middaugh’s  report  was biased against Clum based on Clum’s race and was an important factor in the decision by Raak, Dooling and Vilona to terminate Clum. The court recited the holding in Staub and noted that the 6th U.S. Circuit Court of Appeals had repeatedly applied the cat’s  paw  doctrine to hold employers liable for discrimination by non-decision-makers. The court also explicitly found that the trial court’s cat’s paw instruction was not “reversible error,” even in light of the fact that there were no published state court decisions adopting the cat’s paw theory of liability, thus adopting the Staub standard to state law claims of discrimination.

CONCLUSION

Staub and the resulting decisions give plaintiffs a new mechanism to demonstrate that their protected class or activity caused the adverse action in question when an actor — even one far down the chain of command — sets in motion intentionally an employer’s disciplinary mechanisms that lead, even much later, to an adverse action.