A recent Tenth Circuit decision sends a strong message that the court takes seriously the jurisdictional prerequisite that plaintiffs exhaust their administrative remedies in a Title VII claim prior to taking a claim to court. The process to do so is well-known — before an employee can file a lawsuit alleging discrimination against his or her employer, he or she must file a charge with the U.S. Equal Employment Opportunity Commission (“EEOC”). Requiring individuals to exhaust their administrative remedies prior to filing a lawsuit serves, hopefully, to eliminate facially meritless charges, facilitate internal resolution, and help avoid litigation. This is often the case, as many charges filed with the EEOC never end up on a court’s docket. But what happens if the parties are already enmeshed in litigation and the plaintiff claims that the defendant’s conduct during the course of that litigation is retaliatory? Can the plaintiff amend his or her complaint to include that allegation? Or must he or she go back to the EEOC and file a charge for that claim? In McDonald-Cuba v. Santa Fe Protective Services, Inc., the Tenth Circuit held that the latter is true. No. 10-2151 (10th Cir. May 9, 2011). The Fourth came down the other way in a similar case.
In McDonald-Cuba, the Tenth Circuit continued down the road paved by the court in its prior decision in Martinez v. Potter, 347 F.3d 1208 (10th Cir. 2003). In Martinez, the court held that conduct occurring after the filing of an employee’s Title VII complaint in federal court involving “discrete and independent actions” requires the filing of a new EEOC charge. 347 F.3d at 1210-1211. Martinez had been fired after he filed his Title VII lawsuit. Subsequently, without filing a new EEOC claim, Martinez attempted to add the claim in his summary judgment brief. The court found that Martinez’s discharge was a “discrete and independent action” that should have been exhausted, even though it “occurred after the filing of the judicial complaint.” Id. at 1211. The difference in McDonald-Cuba was that the alleged retaliatory act involved the federal proceeding itself.
The plaintiff in McDonald-Cuba filed post-termination discrimination and retaliation charges with the EEOC against her employer. After receiving a right-to-sue letter, she filed suit. The defendant’s answer included three counterclaims: (i) breach of contract, (ii) intentional interference with prospective economic advantage, and (iii) breach of the duty of loyalty. The plaintiff then filed an amended and supplemental complaint alleging that the defendant’s counterclaims constituted a bad faith effort to retaliate against her for engaging in protected activity. The defendant later voluntarily dismissed the counterclaims. The district court granted summary judgment for the defendant. Upon review, the court, relying on Martinez, held that plaintiffs “must exhaust administrative remedies as to discrete acts of alleged retaliation that involve the filing of a counterclaim in federal court.” Accordingly, the court vacated the district court’s entry of judgment on the added retaliation claim and ordered the district court to dismiss the claim without prejudice.
The Tenth Circuit’s decision is potentially at odds with a decision from the Fourth Circuit. The Fourth Circuit found the exhaustion requirement satisfied where the EEOC charge alleged a “pattern of [retaliatory] conduct.” Jones v. Calvert Group, Ltd., 551 F.3d 297, 304 (4th Cir. 2009) (finding that court could hear retaliatory discharge claim where plaintiff alleged retaliatory discharge in lawsuit but had alleged only retaliatory actions during her employment in EEOC charge). As discussed above, the Tenth Circuit considered the defendant’s filing of counterclaims a “discrete act,” rather than an act that was part of a pattern of retaliation. The court did not mention whether the plaintiff had alleged that the retaliation was continuing in nature in her EEOC charge.
The decision serves as a good reminder that employers cannot be “surprised” in litigation by allegations that a particular act was discriminatory, harassing, or retaliatory. Employers should carefully review each of the plaintiff’s claims and ensure that every discrete act alleged to be discriminatory, harassing, or retaliatory has been included in a charge before the EEOC. Where situations like that in Martinez and McDonald-Cuba arise in other jurisdictions, employers have an opportunity to argue for a similar hard-and-fast adherence to the exhaustion requirement.