Tolton v. Day

Decision Date19 May 2020
Docket NumberCivil Action No. 19-945 (RDM)
PartiesNILAB RAHYAR TOLTON, et al., Plaintiffs, v. JONES DAY, Defendant.
CourtU.S. District Court — District of Columbia
MEMORANDUM OPINION AND ORDER

This case is before the Court on Defendant's motion for partial judgment on the pleadings. Dkt. 37. Plaintiffs Nilab Rahyar Tolton, Andrea Mazingo, Meredith Williams, Saira Draper, Jaclyn Stahl, and Katrina Henderson, all of whom are attorneys, allege that their former employer, Jones Day, unlawfully discriminated against them based on gender, pregnancy, and maternity during their respective tenures at the law firm's Irvine, California, Atlanta, Georgia, and New York City offices. Dkt. 41. Asserting claims under a variety of federal, California, New York, and District of Columbia antidiscrimination laws, Plaintiffs allege that they were paid less; given fewer opportunities to develop their skills, to benefit from mentorship, and to advance; and reviewed more harshly than their male counterparts. They further allege that these outcomes resulted from Jones Day's "black-box" compensation policy—a policy that, according to Plaintiffs, is dictated by the law firm's managing partner, prohibits attorneys from discussing their pay with one another, relies on highly subjective reviews of associates, and discourages attorneys from complaining. Some Plaintiffs assert that they were pushed out of the firm after taking maternity leaves. Plaintiffs also allege that they were subjected to a hostile work environment at Jones Day because of their sex. Some Plaintiffs claim that, when they spoke up to challenge the alleged discrimination, Jones Day retaliated against them.

Jones Day answered Plaintiffs' complaint, Dkt. 44, and moved for partial judgment on the pleadings, Dkt. 37. Jones Day seeks dismissal of: (1) all of Williams's claims; (2) all of Henderson's claims; (3) all disparate impact claims; (4) all claims under the Equal Pay Act and its state law analogues; (5) all claims brought under the District of Columbia Human Rights Act; and (6) all claims for injunctive relief. Jones Day does not, at least at this time, challenge the legal sufficiency of the disparate treatment claims brought by Tolton, Mazingo, Draper, or Stahl.

For the reasons explained below, the Court will GRANT in part and DENY in part Jones Day's motion.

I. BACKGROUND
A. Factual Background

The Third Amended Complaint in this action is 135 pages long. Dkt. 41. The Court will recount only those allegations that are relevant to the pending motion or necessary to provide context. For the purposes of deciding the motion for judgment on the pleadings, Dkt. 37, the Court assumes the truth of the following factual allegations, see Doe v. U.S. Dep't of Justice, 753 F.2d 1092, 1102 (D.C. Cir. 1985); Dial A Car, Inc. v. Transp., Inc., 884 F. Supp. 584, 588 (D.D.C. 1995).

1. Managing Partner System

Plaintiffs allege that Jones Day's managing partner, Stephen Brogan, "runs the [f]irm from its Washington, [D.C.] office with essentially unchecked autonomy." Dkt. 41 at 3 (3d Am. Compl. ¶ 6). The Third Amended Complaint quotes a version of Jones Day's website, which has since been modified, stating that Brogan "is the final decision-maker on virtually every matter ofsignificance for the firm." Id. (3d Am. Compl. ¶ 9). Plaintiffs allege that "every associate's compensation is individualized and determined in a 'black box' by [Brogan], who issues every attorney's compensation letter annually," id. at 2 (3d Am. Compl. ¶ 5), and who "is the final decision-maker on . . . 'partner and associate compensation,'" id. at 3 (3d Am. Compl. ¶ 9). In addition to making these individualized compensation decisions, the managing partner also makes partnership decisions and supervises the annual employee performance evaluations. Id. at 6 (3d Am. Compl. ¶¶ 17, 19). The managing partner "alone possesses ultimate control or influence over all [f]irm leadership partners and any decision they carry out with respect to compensation, promotions, assignments, and other employment terms and conditions." Id. at 6 (3d Am. Compl. ¶ 19).

2. Associate Evaluations and Compensation Decisions

Plaintiffs further allege that Jones Day employs a "black[-]box" compensation scheme, a term that Plaintiffs use to describe the evaluation and compensation process and various interrelated policies. Id. at 2 (3d Am. Compl. ¶ 5). They allege that the "black-box" system, intentionally or unintentionally, causes pay inequality between male and female associates. Id. at 11-12 (3d Am. Compl. ¶¶ 41-42). According to Plaintiffs, associates are evaluated each year, and those evaluations are used in setting their compensation, including both base pay and bonuses. Id. at 12, 93 (3d Am. Compl. ¶¶ 42-43, 357-58). Although the more senior lawyers who have worked with an associate are asked to write an individualized evaluation, the firm delivers its feedback to each associate via a "consensus statement," which is supposed to synthesize all the various reviews as well as the associate's billable hours and other factors into a single paragraph that reflects the associate's performance. Id. at 5 (3d Am. Compl. ¶ 14). Plaintiffs allege—on information and belief—that the "consensus statements are not written byreviewers, and even Jones Day [p]artners cannot alter them." Id. The consensus statement is then read to the associate at her annual review, but the associate is not allowed "to keep a copy of [the] consensus statement" and is not shown "the underlying individual reviews." Id.

Either "inadvertently or by design," according to Plaintiffs, the consensus statement review process works to disadvantage female attorneys, negatively affecting their "pay and opportunities for promotion." Id. at 6 (3d Am. Compl. ¶ 16). They allege that "[t]he 'consensus statement' often cherry picks language from individual evaluations without context, emphasizing some aspects of performance while completely overlooking other aspects, and attributing the opinion of one evaluator to that of multiple reviewers." Id. at 5 (3d Am. Compl. ¶ 15). The process leaves room for manipulation as well as "gender stereotypes" and allows biases to work their way into associates' composite "consensus" reviews. Id. at 6 (3d Am. Compl. ¶ 17). Plaintiffs quote an earlier version of the Jones Day website, which stated that "associate evaluations and compensation adjustments [are] based upon the subjective quality of each person's overall contribution, including professional achievement, commitment to the [f]irm, judgment, client service, efficiency, leadership, productivity, and other appropriate factors." Id. at 12 (3d Am. Compl. ¶ 43).

Another key component of Jones Day's black-box compensation scheme is its emphasis on pay secrecy. See id. at 12 (3d Am. Compl. ¶ 42). Associates and partners alike are strongly discouraged from discussing their compensation with one another. The following quote from the Jones Day website, as it existed at the time Plaintiffs brought suit, explains the firm's approach:

The financial relationship of a lawyer to Jones Day is confidential. Other than the very small number of people who advise the Managing Partner on these issues, no partner at Jones Day knows anything about the amount of income allocated to any other partner. Similarly, associate compensation is also confidential, for the same reasons: Jones Day compensates its associates individually, not by lockstep and certainly not based on some billable hoursformula, and thus every associate's compensation is the product of his or her individual contributions, and cannot be fairly compared to any other individual. What is sometimes critically referred to by those outside Jones Day as a "lack of transparency" is almost universally viewed inside Jones Day as one of its great strengths. This confidentiality removes any temptation to try to compare apples to oranges; it eliminates the chance of creating inappropriate comparisons and jealousies; and most importantly, it does not allow even the possibility of creating barriers to the effective interaction of all Jones Day lawyers.

Id. Plaintiffs allege that this policy "prevents associates from learning of gender-based pay disparities and remediating them," id. at 16 (3d Am. Compl. ¶ 48), and permits subjective biases to infect the process, see id. at 5, 16, 83 (3d Am. Compl. ¶¶ 14-15, 48, 310). Matters are made worse, according to Plaintiffs, by the firm's "No Whining" policy, which discourages dissent and dovetails with the pay secrecy policy to discourage employees from disputing their allotted salaries and from complaining about discrimination. See id. at 18 (3d Am. Compl. ¶ 55). Plaintiffs allege that Brogan regularly includes the phrase "No Whining" in slides that he presents to the firm. Id. (3d Am. Compl. ¶ 54).

Finally, Plaintiffs allege that Jones Day's statements about how it pays its associates compared to other law firms, when viewed alongside their own personal salary histories, suggest that Jones Day underpays women. Plaintiffs allege that, in February 2019, the Jones Day website represented as follows: "For those associates who produce consistent high-quality work, we intend that they will be compensated at or above the upper level of the markets in which we operate." Id. at 13 (3d Am. Compl. ¶ 44). "But, despite their strong performances—even in the years when those strong performances were acknowledged in their reviews—Jones Day did not compensate the Plaintiffs in light with the 'Cravath' market scale."1 Id. The Third AmendedComplaint includes charts allegedly reflecting the "Cravath scale" for each year that the Plaintiffs were employed at Jones Day and compares those figures with what Plaintiffs themselves were paid during each of those years. See id. at 14-15 (3d Am. Compl. ¶ 45).

3. Firm Culture

Plaintiffs also allege that Jones Day has a "[f]raternity [c]ulture" in which "[s]enior male partners mentor young male associates,...

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