May 19, 2016

Supreme Court Decides RST Van Expedited, Inc. v. EEOC

On May 19, 2016, the Supreme Court of the United States decided RST Van Expedited, Inc. v. EEOC, No. 14-1375, holding that a defendant may be a prevailing party—and therefore entitled to an award of attorneys’ fees under Title VII of the Civil Rights Act of 1964—if it prevails on procedural grounds, and that a ruling on the substantive merits is not necessary for recovery of attorneys’ fees.

An employee of CRST Van Expedited, Inc. alleged that she was sexually harassed on the job. In 2007, the Equal Employment Opportunity Commission (EEOC) filed suit against CRST and identified over 250 women who were allegedly sexually harassed by CRST.

The district court rejected the EEOC’s claims, all on procedural grounds such as statute of limitations, judicial estoppel, failure to report harassment in a timely fashion, and because the EEOC had “wholly abandoned its statutory duties” to investigate. The court dismissed the lawsuit and, because CRST was a prevailing party, invited CRST to apply for attorneys’ fees. The court ultimately granted CRST over $4 million in attorneys’ fees. On appeal, the Eighth Circuit held that, before a defendant can be deemed to have “prevailed” and thus be eligible for an award of attorneys’ fees, there must have been a favorable “judicial determination . . . on the merits.” Because CRST’s judgment was procedural and not “on the merits,” the court reversed the award of attorneys’ fees.

The Supreme Court reversed, holding that a favorable ruling on the merits is not a necessary predicate to find that a defendant is a prevailing party and therefore entitled to an award of attorneys’ fees under Title VII. The Court concluded that common sense bolstered this conclusion, for even if a case is dismissed for reasons other than the substantive merits, the defendant still may have “fulfilled its primary objective” in the case. Thus, the defendant “may prevail even if the court’s final judgment rejects the plaintiff’s claim for a nonmerits reason.” The Court listed sovereign immunity, mootness, and groundlessness as examples of non-merits reasons for which a case could be dismissed that could still entitle a prevailing defendant to an award of attorneys’ fees. The Court added that there was nothing in Title VII indicating that Congress intended defendants to recover attorneys’ fees only if the case is disposed of on the merits.

Justice Kennedy delivered the opinion for a unanimous Court. Justice Thomas filed a concurring opinion.

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