Supreme Court Opens Gates to Plaintiff “Mixed-Motive” Employment Discrimination Lawsuits
 
September 25, 2003
 

On June 9, 2003, the United States Supreme Court stunned the management-side defense bar by opening the gates to plaintiff “mixed-motive” employment discrimination lawsuits. In a unanimous decision, the Court ruled that circumstantial evidence of discrimination can be sufficient to allow the employee to win a discrimination case based upon a mixed-motive theory, and rejected a requirement that the plaintiff demonstrate direct evidence of discrimination.  Desert Palace, Inc., d/b/a Caesars Palace Hotel & Casino v. Costa, No. 02-679 (June 9, 2003). In Caesars Palace, the Court held that the employee can win by showing through circumstantial evidence that the employer relied in part on a discriminatory reason in making its decision, even if other legitimate reasons motivated the decision. While the employer can limit damages by proving that it would have made the same decision even if it did not consider the illegitimate motive, the employer is still liable for attorneys fees and costs. Caesars Palace made it substantially easier for employees to recover in a discrimination lawsuit simply by casting the case as one of “mixed motive,” and therefore, as a practical matter, substantially lowered the plaintiff’s obstacle to obtaining a favorable verdict.

Single-Motive Theory v. Mixed-Motive Theory

Under Title VII, a plaintiff may prove an employment discrimination claim in one of two ways: under a “pretext/single-motive” theory or a under “mixed-motive” theory. In a pretext case, the plaintiff must establish a prima facie (or initial) case of discrimination. If the plaintiff succeeds, the burden shifts to the employer to articulate a legitimate, nondiscriminatory reason for its adverse action. Once the employer meets that burden, the employee must then show that that reason was false and a pretext for illegal bias. The burden of proof and persuasion in this method always remains on the plaintiff.

The mixed-motive concept recognizes that employers may make employment decisions for multiple reasons, and that both legitimate and discriminatory reasons may exist. The Civil Rights Act of 1991 amended Title VII to provide that a decision is illegal so long as one motive was discriminatory, even if there were other legitimate reasons for the decision. The 1991 Act states that an unlawful employment practice is established “when the complaining party demonstrates that race, color, religion, sex or national origin was a motivating factor for any employment practice, even though other factors also motivated the practice.” It further provides that if the plaintiff demonstrates that an impermissible motive existed, the employer can avail itself of a limited affirmative defense that restricts the available remedies if it demonstrates that it would have taken the same action absent the impermissible motivating factor. In such a case, only declaratory relief, certain types of injunctive relief, and attorneys fees and costs are available to the plaintiff.

Before the Costa decision, the nation’s federal appellate courts had been divided on the showing a plaintiff must make to invoke the mixed-motive concept, i.e., to establish that unlawful discrimination was a motivating factor in the employment decision. The majority of courts had held that a plaintiff must introduce direct evidence of illegal bias to make a mixed-motive claim. “Direct evidence” has been interpreted to mean evidence that proves discrimination on its face, without the need for any inferences. A common example of direct evidence is statements by the decision-maker expressing bias in connection with the specific adverse employment decision, or business documents which admit the same. This “direct evidence” requirement has sharply limited plaintiffs’ ability to claim mixed-motive discrimination, because few employers make overtly biased statements in connection with employment decisions.

Whether “direct evidence” is required to obtain a mixed-motive jury instruction in light of the 1991 Civil Rights Act amendments was the essential question in Costa. The Supreme Court held that direct evidence was not required.

The Case and the Court’s Ruling

Plaintiff Costa worked in the warehouse at Caesars Palace in Las Vegas. She was the only woman in her work group. In 1994, Costa was involved in a physical altercation with a male co-worker. Following the incident, Caesars suspended the male employee for five days, but terminated Costa. 

Costa sued, alleging gender discrimination under Title VII. At trial, she presented evidence and argued that she was frequently treated more harshly than men in her working conditions and the discipline imposed upon her, including her discharge. Costa requested that the district court give the jury a “mixed-motive” instruction, i.e., to tell the jury that if she proved that her gender was one factor motivating the decision, she should win – even if the employer had other legitimate reasons. The employer objected, claiming that Costa had failed to present any direct evidence that gender was a motivating factor in her termination or any other adverse employment action taken against her. The judge gave the mixed-motive instruction, and the jury found in Costa’s favor for a total of $365,000 in back pay, compensatory and punitive damages.

Caesars appealed the jury verdict to the U.S. Court of Appeals for the Ninth Circuit. The Ninth Circuit agreed that the mixed-motive instruction was appropriate. Refusing to follow most other federal appellate courts, it held that Costa could establish a mixed-motive case by relying exclusively on circumstantial evidence of discrimination. The Supreme Court agreed to hear the case to resolve the division among the federal appellate courts.

In a unanimous decision written by Justice Thomas, the U.S. Supreme Court agreed with the Ninth Circuit. The Court began by noting that in 1991, Congress amended Title VII to clearly allow employees to bring mixed-motive cases and to create a limited, affirmative defense for employers. However, the Court found no evidence that Congress intended mixed-motive cases to be limited to situations in which employees have direct evidence of discrimination. The Court held that the mixed-motive provision of Title VII unambiguously states that a plaintiff need only “demonstrate” that an unlawful characteristic was considered in any employment practice, and does not require a heightened showing through direct evidence. The Court concluded that if Congress intended to require direct evidence, “it could have included language to that effect…”.

The Court also noted that the Act’s silence with respect to the type of evidence required in mixed-motive cases suggested that the Court should not depart from the conventional civil litigation rule that a plaintiff prove his case by a preponderance of the evidence using either direct or circumstantial evidence. Reiterating that circumstantial evidence is not only sufficient, but also may be more certain and satisfying in some cases, the Court noted that the sufficiency of circumstantial evidence has never been questioned in a criminal case, where proof beyond a reasonable doubt is required. The Court concluded that there was no precedent for restricting a litigant to the presentation of direct evidence absent some directive in a statute. Thus, in order to obtain a mixed-motive instruction, the plaintiff need only present sufficient evidence for a reasonable jury to conclude, by a preponderance of the evidence, that “race, color, religion, sex, or national origin was a motivating factor for any employment practice.”

Lessons and Practical Suggestions

The Costa decision is probably the most significant anti-defense employment law decision since the Price Waterhouse v. Hopkins mixed-motive decision in 1989. The Court’s decision that circumstantial evidence is sufficient for an employee to present a mixed-motive theory case to the jury means that in every lawsuit filed, the plaintiff will: 1) seek from the start to position the case as one of mixed motive in order to defeat summary judgment; and 2) if the plaintiff survives summary judgment, he or she will seek to inform the jury that the plaintiff merely has to show that discrimination was only one reason motivating the decision, rather than the main reason.

On a theoretical and practical level, the Caesars Palace decision would seem to subsume, or at least render impotent, the Supreme Court’s decision in McDonnell Douglas Corp. v. Green, in which the Court established its well-used, burden-shifting framework requiring the establishment of a prima facie case, to be rebutted by the showing of a legitimate business reason. In this regard, a creative plaintiff’s lawyer will always assert a mixed-motive theory to get the case beyond summary judgment. Whether or not the plaintiff pleads a mixed-motive case, the employer is faced with a Hobson’s choice. The employer must choose whether to assert, either in its initial pleading or at some later time, the affirmative defense that it would have made the same decision in the absence of a discriminatory motive. Asserting this affirmative defense substantially increases the likelihood that the employer will educate the plaintiff’s attorney about his or her own case theories, and very likely many taint the jury’s perception of the employer’s defenses. This is because once an employer acknowledges that an unlawful characteristic was considered, the jury is highly likely to find some unlawful motivation, even if the employer asserts that same decision would have been reached based upon legitimate reasons. 

Remember, the affirmative defense is not a complete defense to liability. Rather, it only cuts off certain remedies. If the employer proves that it would have made the same decision even in the absence of discrimination, the court cannot award damages or order that the plaintiff be reinstated. However, even if the jury accepts the defense, the employer is still liable for discrimination, can be ordered to undertake certain injunctive relief, and is required to pay the plaintiff’s attorneys fees and costs.

The Caesars Palace decision will make it easier for employees to defeat summary judgment, and to win discrimination lawsuits. More mixed-motive lawsuits will be filed, and more will end up going to trial. An employer’s only defense is prevention. Employers must redouble their efforts to ensure that they base employment decisions on legitimate, non-discriminatory considerations that are accurately documented, and that they apply their policies and discipline fairly and consistently. It is more important than ever that employers answer “yes” to the following questions:

• Did your employee know about the work rule and its consequences?
• Did your employee violate the rule?
• Did you conduct a fair investigation?
• Do you have evidence that the employee violated the rule?
• Have you applied the rule consistently?
• Have you been consistent in the penalty imposed for violation of the rule?

Answering any of these questions “no” could jeopardize your ability to effectively defend your company. 

Similarly, it is crucial for employers to be careful when describing the reasons for an employment decision, particularly in response to charges of discrimination before the EEOC and state fair employment departments. Incorrect or incomplete statements of the reasons for a decision may give an employee the ammunition to later claim that because your stated reasons for a decision have changed, they are a pretext for discrimination.

For more information, e-mail Mark Spognardi at mark.spognardi@hklaw.com, or call toll free, 1-888-688-8500.

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