EEOC v. American Nat. Bank

• Decision Date: 31 August 1976
• Docket Number: Civ. A. No. 76-26-N.
• Citation: 420 F. Supp. 181
• Court: U.S. District Court — Eastern District of Virginia
• Parties: EQUAL EMPLOYMENT OPPORTUNITY COMMISSION, Plaintiff, v. AMERICAN NATIONAL BANK, Defendant.

420 F. Supp. 181

EQUAL EMPLOYMENT OPPORTUNITY COMMISSION, Plaintiff, v. AMERICAN NATIONAL BANK, Defendant.

Civ. A. No. 76-26-N.

United States District Court, E. D. Virginia, Norfolk Division.

August 31, 1976.

COPYRIGHT MATERIAL OMITTED

Spencer H. Lewis, Jr., E.E.O.C., Philadelphia Regional Litigation Center, Philadelphia, Pa., James A. Oast, Jr., Asst. U. S. Atty., Norfolk, Va., for plaintiff.

Paul M. Thompson, Hunton & Williams, Richmond, Va., for defendant.

MEMORANDUM OPINION AND ORDER

CLARKE, District Judge.

This is an action brought pursuant to 42 U.S.C. § 2000e, et seq., commonly referred to as Title VII of the Civil Rights Act of 1964, as amended, by the Equal Employment Opportunity Commission hereinafter referred to as "EEOC" claiming that the Suffolk Branch of the American National Bank has been since May, 1969 and is now guilty of discriminatory employment practices. The Complaint seeks equitable relief in the form of an injunction against further discrimination, the requirement that defendant institute an affirmative action program, and back pay for those discriminated against.

The matter comes before the Court on the defendant's Motion for Summary Judgment based on two grounds. First, the EEOC cannot establish that the charging party, Sandra Holland, ever filed an application for employment with the Suffolk Branch of the American National Bank, and second, the affirmative defense of laches based on the presence of unreasonable delay and resulting prejudice.

Facts

A review of the Complaint, Answers to Interrogatories, documents submitted pursuant to motions to produce and depositions heretofore taken, establish the following uncontradicted facts:

1. The action is based on a charge filed with the EEOC by Sandra Holland in which Mrs. Holland claims to have filed an application for employment with the Suffolk Branch of the American National Bank in May, 1969 and that she was not hired because she was black.

2. EEOC undertook to investigate the charge.

3. It was not until May 11, 1974, that the EEOC made a "Determination" based on the charge.

4. Conciliation was unsuccessfully attempted after the determination of May 11, 1974.

5. On August 22, 1974, EEOC issued a "Right-to-Sue" letter to Mrs. Holland.

6. Mrs. Holland did not file suit following receipt of the "Right-to-Sue" letter from EEOC.

7. On January 21, 1976, six and one-half years after the initial charge, the EEOC filed this action based upon the Holland charge.

8. Plaintiff's answer to first interrogatories clearly shows that as of the time of filing this suit the sole individual claiming to be aggrieved by American National Bank's Suffolk Branch's alleged discriminatory practices was Sandra Holland, and that the charge of discrimination relied upon in bringing the suit was dated June 19, 1969.

Applicability of Affirmative Defense

Although it is clear, in this Circuit at least, that the EEOC is not bound by any strict statutory time limits in bringing its actions, either state or federal,¹ nonetheless, a limitation on EEOC enforcement powers may be found in traditional notions of equity and the Administrative Procedure Act, 5 U.S.C. § 706(1).² There are many cases which state as a general principle that the doctrine of laches may not be imputed against the Government to bar its actions in court. See, for example, United States v. Summerlin, 310 U.S. 414, 60 S.Ct. 1019, 84 L.Ed. 1283 (1940); Chromcraft Corp. v. EEOC, 465 F.2d 745, 746, n.2 (5th Cir. 1972). (The latter case, while denying the applicability of laches as such, did note the applicability of the Administrative Procedure Act as an equitable limitation.) On the other hand, it is clear that the Government is not universally immune from claims of delay and resulting prejudice. See Clearfield Trust Co. v. United States, 318 U.S. 363, 63 S.Ct. 573, 87 L.Ed. 838 (1943), a commercial case which ruled that a Federal standard applied to determine whether delay was unreasonable and prejudicial and assumed that the sovereignty of the Government did not shield it from such defenses. "The fact that the drawee is the United States and the laches those of its employees are not material." citation omitted Id. at 369, 63 S.Ct. at 576. As a general proposition, then, the question of the applicability of laches against the Government is not "well settled."³

In order to file suit against employers or others to vindicate the public interest, the EEOC must have a charge filed with it by an alleged victim of discrimination or by a member of the Commission. (42 U.S.C. § 2000e-5) The charge is the starting point for investigation and may lead to allegations of widespread discrimination by the party being investigated. However, it is notice of the initial charge which is given to the employer and on which the EEOC must rely as a "ticket" into court. Sanchez v. Standard Brands, Inc., 431 F.2d 455 (5th Cir. 1970). This restriction shows that the EEOC may not rely solely on theoretical adherence to its laudable purpose, but rather must be presented with actual controversies and allegations. Even if continuing, broad-based discrimination is alleged, the EEOC is limited in proceedings by the existence of specific charges, even though the relief available and even the types of discrimination alleged go beyond what the charging party may have claimed.⁴

Fundamental fairness should require reasonably prompt action by the Government when seeking to impose substantial penalties on parties charged with discrimination. Unconscionable delay in proceedings under Title VII not only disserves the policy of ending discrimination while leaving the alleged victim of discrimination without relief,⁵ but also the parties charged are left in the Damoclean situation of never knowing when an old charge may spring back into life as the basis of a lawsuit against it. The proper functioning of administrative agencies and the proper relationship between a government and its citizens, individual and corporate, should not allow the unending possibility of litigation on forgotten matters.

Fortunately, the legal system is not powerless to deal with such problems. The precise question of the applicability of laches and 5 U.S.C. § 706(1) against the EEOC has been considered by several other district courts.

Acting under somewhat confusing guidance from the Fifth Circuit, Chief Judge Edenfield in a pair of unrelated cases finally declined, because of inadequate authority from the Fifth Circuit,⁶ to hold that laches was applicable against the Government but did rule that a court, using 5 U.S.C. § 706(1), could achieve the same result, namely bar an agency from proceeding when its unreasonable delay has prejudiced the defendant. EEOC v. Moore Group, Inc., 416 F.Supp. 1002 (N.D.1976); EEOC v. Metro Atlanta Girls' Club, 416 F.Supp. 1006 (N.D.Ga.1976).

In those cases, Judge Edenfield discussed the notations from the Fifth Circuit regarding limitation on EEOC enforcement power. In his first order in the Moore Group case, 11 EPD ¶ 10, 886 (March 25, 1976), he cited United States v. Georgia Power Co., 474 F.2d 906 (5th Cir. 1973) and EEOC v. Griffin Wheel, 511 F.2d 456, which apparently endorsed application of the doctrine of laches. In EEOC v. Exchange Security Bank, 529 F.2d 1214 (1976), the Fifth Circuit failed to mention the doctrine of laches while considering the question of delayed enforcement. In doing so, however, as noted in Moore Group, supra, the court made clear that unreasonable delay, if proved, which results in prejudice, if proved, could constitute a defense under 5 U.S.C. § 706(1). This was the doctrine applied by Chief Judge Edenfield. In Moore Group, the factors of unreasonable delay and prejudice were found; in Atlanta Girls' Club, they were not. Thus, application of an equitable limitation has been endorsed by the Fifth Circuit, whether identified as laches or 5 U.S.C. § 706(1).

Two earlier cases applied laches against the EEOC and barred suit. EEOC v. C & D Sportswear Corp., 398 F.Supp. 300 (M.D.Ga. 1975) and EEOC v. J. C. Penney Co., 12 FEP Cases 640 (N.D.Ala. December 16, 1975). In the C & D case, the Court noted the passage of six years and the advanced age of a key defense witness and found unreasonable delay resulting in prejudice to the defendant. In the Penney case, the court applied the doctrine and found laches based on delays far shorter than in the instant case.

In EEOC v. Nicholson File Co., 408 F.Supp. 229 (D.Conn.1976), the court recognized the availability of "an equitable defense, in the nature of laches," the elements of which could be demonstrated at trial.

Thus, there is ample authority for the proposition that an administrative agency such as the EEOC, even in the absence of specific statutory time limits, may not postpone enforcement indefinitely without excuse to prejudice of the defendant. As Judge Edenfield put it in his first decision in Moore Group:

"The EEOC indeed has a duty to vindicate the important public rights secured to all citizens under Title VII; it may not, however, do so in a manner which rides roughshod over the rights of private parties and the notions of fairness and due process as well. If this defendant is indeed engaging in discriminatory employment practices, the victims thereof are free to file fresher charges with the EEOC. The Commission shall not be allowed to proceed further on the inexcusably stale charges herein." 11 EPD Cases 7740.

Imposition of this equitable limitation, whether under the theory of laches or under authority of 5 U.S.C. § 706(1), should not hamper the legitimate functioning of the agency. It is still free to investigate fully any other charge that may be made. No adverse impact on EEOC conciliation process should result because dilatory bargaining by a defendant which increases the passage of time will not aid in establishment of this defense. The agency will merely be required to act with greater dispatch in those cases where ...