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2 March 2011

US Supreme Court Issues Opinion in Staub v. Proctor Hospital

In an opinion issued yesterday, the Supreme Court recognized the so-called “cat’s paw” theory of liability in employment discrimination cases—a decision that will have implications for employment-discrimination claims brought under a wide variety of statutes.

The Court’s decision, in Staub v. Proctor Hospital, No. 09-400, came in a case brought under the Uniformed Services Employment and Reemployment Rights Act of 1994 (“USERRA”), 38 U.S.C. § 4311 et seq., which makes it unlawful for an employer to discriminate on the basis of an employee’s membership in the armed services. The Court held that an employer is liable under USERRA when a supervisor animated by antimilitary bias acts with the intent to cause an adverse employment action and, although the supervisor is not the ultimate decisionmaker, the supervisor’s conduct is a proximate cause of a subsequent adverse employment action.

The petitioner in Staub had military obligations that prevented him from working certain periods of the year. After respondent Proctor Hospital terminated his employment, petitioner sued, claiming that his discharge was influenced by the discriminatory animus of supervisors who were hostile to his military obligations. A jury found in petitioner’s favor. But the Seventh Circuit reversed, concluding that an employer could not be liable for a non-decisionmaker’s animus under USERRA if the employer conducted an investigation into the facts relevant to the decision. 560 F.3d 647, 659. 

In an opinion by Justice Scalia, the Supreme Court reversed. The Court observed that USERRA, a statute that “is very similar to Title VII,” provides that discrimination is established when animus was “a motivating factor in the employer’s action.” Slip op. 5. The Court also noted that “when Congress creates a federal tort it adopts the background of general tort law.” Id. Relying in large part on principles of agency and proximate causation, the Court held that so long as the non-decisionmaker “intends, for discriminatory reasons, that the adverse action occur, he has the scienter required to be liable under USERRA.” Id. at 7. The Court found it “axiomatic under tort law that the exercise of judgment by the decisionmaker does not prevent the earlier agent’s action (and hence the earlier agent’s discriminatory animus) from being the proximate cause of the harm.” Id.  

In a concurring opinion, Justice Alito, joined by Justice Thomas, took the position that the Court’s decision should have focused on the statutory text—specifically, the phrase “motivating factor in the employer’s action”—rather than on principles of agency and tort law.

Justice Kagan did not participate in the case.

For more information about any of the issues raised in this Legal Update, please contact Robert Davis at +1 212 506 2455 or Marcia Goodman at +1 312 701 7953.

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