In what can certainly be described as a “victory” for employers, the EEOC was recently tagged for over $35,000 in legal fees for its pursuit of a “frivolous” claim under Title VII. In EEOC v. Eagle Quick Shop, the EEOC pursued a claim for purported retaliation against an employee of the defendant. The defendant presented essentially undisputed evidence that it did not have the required 15 employees to trigger jurisdiction under Title VII. Despite that evidence, the EEOC pursued its litigation.

Eventually, the Court dismissed the claim and imposed attorney’s fees upon the EEOC beginning at the time it “knew or should have known” that it was unable to establish a prima facie case under Title VII. The Court specifically opined that “[w]hether as a result of negligence, incompetence, or the force of bureaucratic momentum, the EEOC continued to litigate while missing evidence necessary [to] lay a fundamental element of its case.” Significantly, while not expressly holding the EEOC to a “higher standard” than other plaintiffs, the Court noted that the EEOC is possessed with the knowledge and experience to quickly ascertain whether a defendant is an “employer” under Title VII.

Certainly this result is not the norm, and employers should not tempt fate by reminding EEOC investigators of the decision. However, it does reinforce the fact that, despite what are at times unyielding positions taken by the EEOC, the ultimate determination rests with the Courts.  Moreover, employers should always involve counsel when faced with a charge of discrimination before the EEOC or State Human Relations Commission.

Rhoads & Sinon regularly represents financial institutions in all aspects of Business and Banking Litigation. For more information, contact Robert J. Tribeck, Esquire at 717.237.6701 or rtribeck@rhoads-sinon.com.