Gibson v. Brown

• Decision Date: 07 May 1998
• Docket Number: No. 96-3776,96-3776
• Citation: 137 F.3d 992
• Parties: 76 Fair Empl.Prac.Cas. (BNA) 450, 73 Empl. Prac. Dec. P 45,275 Michael GIBSON, Plaintiff-Appellant, v. Jesse BROWN, Secretary, Department of Veterans Affairs, Defendant-Appellee.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 992

137 F.3d 992

76 Fair Empl.Prac.Cas. (BNA) 450,

73 Empl. Prac. Dec. P 45,275

Michael GIBSON, Plaintiff-Appellant, v. Jesse BROWN, Secretary, Department of Veterans Affairs Defendant-Appellee.

No. 96-3776.

United States Court of Appeals Seventh Circuit.

Argued Sept. 24, 1997.

Decided March 3, 1998.

Rehearing and Suggestion for Rehearing En Banc Denied May 7, 1998.

Timothy M. Kelly (argued), Chicago, IL, for Plaintiff-Appellant.

Ernest Y. Ling (argued), Office of the United States Attorney, Civil Division, Chicago, Il for Defendant-Appellee.

Before RIPPLE, MANION and KANNE, Circuit Judges.

MANION, Circuit Judge.

Michael Gibson, a career federal employee at the Department of Veterans Affairs, experienced sex discrimination in 1992 when he applied to be a supervisory accountant at his supply depot but was turned down by his two female supervisors. The EEOC ordered Gibson's promotion (and backpay), but Gibson filed suit in the district court when the VA was slow to comply. By the time the district court ruled on his suit, the VA had implemented most of the Commission's order, making the complaint largely moot. But Gibson's claim for compensatory damages remained. The court dismissed that claim after concluding that Gibson never asked the EEOC to compensate him for the VA's discrimination. We reverse.

I.

In 1988 Michael Gibson began his career working for the VA as an accountant in the agency's Albuquerque, New Mexico facility. He transferred in 1990 to the VA supply depot in Hines, Illinois, where he later applied for a promotion to become a supervisory accountant (at the time, he was a GS-9 accountant). He did not get the promotion, and when Gibson's two female supervisors selected a woman for the position instead of him, Gibson filed a timely Title VII claim alleging sex discrimination. In July 1993, about a year after he had filed his claim, the VA issued its final agency decision finding no discrimination. Gibson appealed to the EEOC. In October 1995, the Commission reversed the VA, finding that the VA had indeed discriminated against Gibson in the promotion decision.

In the federal domain the EEOC's final determinations of discrimination are binding against government agencies unless the complainant himself seeks de novo review of that finding in federal court. See 29 C.F.R. § 1614.504(a) ("A final decision that has not been the subject of an appeal or civil action [by the complainant] shall be binding on the agency."); Morris v. Rice, 985 F.2d 143, 145 (4th Cir.1993) ("[Congress] provided that final decisions of the EEOC were to be binding on federal agencies."). Accordingly, along with the parties we acknowledge that the VA discriminated against Gibson when his supervisors chose a less experienced woman to be the supervisory accountant at Gibson's supply depot. The Commission also provided a remedy for the discrimination: it ordered the VA to promote Gibson and issue him backpay. The VA did these things, but reluctantly (a month late), prompting Gibson to file a federal complaint in district court seeking compliance with the Commission's nonappealable order. See 29 C.F.R. § 1614.408(a).

In the district court, Gibson asked for much of the relief that the VA belatedly gave him, which meant that for the most part his complaint was moot by the time the VA moved to dismiss it. But Gibson's claim for compensatory damages remained-specifically, he asked for compensatory damages relating to mental anguish and emotional distress resulting from the VA's discrimination (and experienced over the ensuing three years, during which Gibson was forced to work for the same supervisor who discriminated against him ¹). The district court interpreted the claim for compensatory damages as an entirely new claim of discrimination, and then dismissed it because Gibson did not present it in the first instance to the EEOC (or, in administrative law parlance, because Gibson had failed to exhaust his administrative remedies). The district court added that even if it interpreted the new claim as one seeking only relief (as we interpret it), viz. compensatory damages, the same rule of exhaustion would apply and require its dismissal.

Apparently the district court interpreted Gibson's claim for compensatory damages (as Gibson phrased it, damages for the "humiliation, mental anguish and emotional distress" caused by the VA's discrimination) as a claim for retaliation or postdiscriminatory harassment. Gibson does complain that he was forced to work for three years (from 1992-95, while the appeals were pending) for the same supervisor who had discriminated against him, but we do not interpret this as a new claim of discrimination. Under the Civil Rights Act of 1991, claims for compensatory damages are claims for "future pecuniary losses, emotional pain, suffering, inconvenience, mental anguish, loss of enjoyment of life, and other nonpecuniary losses." See § 1981a(b)(3). Gibson asks for exactly these damages (even repeating the statute's language concerning "mental anguish"). Accordingly, we will treat his claim as one seeking recovery for the VA's discrimination rather than a brand new claim of discrimination. ² As far as the government is concerned, the distinction ultimately makes no difference--whether Gibson raises a new instance of discrimination or a new demand for relief, it is barred because Gibson never presented it to the EEOC. Having determined that Gibson's complaint is a claim for damages--not a new claim of discrimination--we are left to decide whether the government correctly argues that it is barred anyway.

II.

There is some dispute over whether Gibson asked the EEOC for compensatory damages. If he did, then the government's failure-to-exhaust argument obviously is a non-starter. But both parties agree that Gibson never asked to be compensated for emotional distress, or humiliation, nor did he invoke any other term typically associated with a demand for compensatory damages. (At one point, Gibson did instruct the EEOC investigator that he would settle his case for a "monetary cash award"; the relief ordered by the EEOC included backpay.) It would be simpler if we could say that Gibson put the EEOC on notice that he was seeking compensatory damages (as opposed to, say, backpay, which is considered equitable relief, § 1981a(b)(2)), but the record does not support it. Accordingly, we must now decide whether his failure to exhaust administrative remedies with respect to compensatory damages means he could not later obtain these damages from the district court.

Ordinarily, a failure to exhaust administrative remedies on an issue means that the complainant may not press his claim in federal court. McCarthy v. Madigan, 503 U.S. 140, 144-45, 112 S.Ct. 1081, 1085-87, 117 L.Ed.2d 291 (1992). Exhaustion "serves the twin purposes of protecting administrative agency authority and promoting judicial efficiency." Id. at 145, 112 S.Ct. at 1086. But it could go without saying that a party is not required to seek relief from an administrative agency (before seeking it from a federal court) if the agency does not have the power to redress a claim in the way the complainant requests. Id. at 148, 112 S.Ct. at 1088. In other words, while an administrative agency may be "competent to adjudicate the issue presented," (here, Gibson's claim of discrimination), exhaustion is not required if it "lack[s] authority to grant the type of relief requested" (in this case, money damages). Id., citing McNeese v. Board of Ed. for Community Unit School Dist. 187, 373 U.S. 668, 675, 83 S.Ct. 1433, 1437-38, 10 L.Ed.2d 622 (1963) (students seeking to integrate public school need not file complaint with school superintendent because the "Superintendent himself apparently has no power to order corrective action" except to request the Attorney General to bring suit); Montana Nat'l Bk. of Billings v. Yellowstone County, 276 U.S. 499, 505, 48 S.Ct. 331, 333, 72 L.Ed. 673 (1928) (taxpayer seeking refund not required to exhaust where "any such application [would have been] utterly futile since the county board of equalization was powerless to grant any appropriate relief").

In this case, Gibson says that while the EEOC can adjudicate the merits of his discrimination claim, and even provide equitable relief such as backpay and a promotion (both of which it ordered in his case), asking the EEOC to issue compensatory damages would be asking it to do what it has no authority to do. (Nothing in the statute or regulations explicitly rules out the idea, though the only payments mentioned in the regulations relate to "loss of earnings"--presumably backpay-caused by the federal agency's discrimination. See 29 C.F.R. § 1614.501(a).)

On the one hand it sounds logical that the EEOC can issue compensatory damages. After all, the agency was created by Congress not only to investigate complaints of discrimination, but, in the federal sector, to adjudicate them. And more than this, in the federal sector, Congress empowered the EEOC to enforce Title VII's antidiscrimination provisions by issuing "such rules, regulations, orders and instructions as it deems necessary and appropriate to carry out its responsibilities." 42 U.S.C. § 2000e-16(b). It is not unreasonable to conclude that this mandate might be broad enough to allow the EEOC to award compensation for mental anguish and emotional distress, much like the damages Gibson seeks in this case. Indeed, the Fifth Circuit cited this statutory language in concluding that Congress intended the EEOC to redress discrimination by any means necessary, including by issuing awards of compensatory damages; the court punctuated its determination by noting that the statute already allows the Commission to issue back pay, "which is a form of compensatory damages." Fitzgerald v. Secretary, Veterans Affairs, 121 F.3d 203, 207 (5th Cir.1997). The Fifth Circuit certainly was correct to turn first to the language of Title...