Supreme Court Applies Deferential Standard to EEOC Subpoena Reviews

On April 3, 2017, in a 7-1 ruling, the U.S. Supreme Court vacated a Ninth Circuit decision concluding that a district court had erred by declining to enforce a subpoena issued by the Equal Employment Opportunity Commission (EEOC). McLane Co., Inc. v. Equal Employment Opportunity Commission. The Court held that a district court’s decision whether to enforce or quash a subpoena should be reviewed for abuse of discretion, not de novo review as applied by the Ninth Circuit. The Court ordered the Court of Appeals to review the district court’s decision under the appropriate standard of review.

The matter arose when a former employee of McLane Co. filed a charge alleging sex discrimination under Title VII with the EEOC. The employee was a former cigarette selector whose duties including lifting, packing, and moving large bins containing products. Upon returning from a three month maternity leave, and consistent with McLane policy applicable to all employees returning from medical leave to physically demanding positions, the employee was required to take a physical evaluation. After failing the evaluation three times, the employee was terminated.

Thereafter, the EEOC began an investigation into the employee’s charge, and requested information concerning the evaluation as well as a list of employees that McLane asked to take the evaluation. McLane provided the EEOC with a list containing each employee’s gender, role at the company, and evaluation score, as well as the reason each employee had been asked to take the evaluation. However, McLane refused to provide so-called “pedigree information,” or in other words, the names, Social Security numbers, last known addresses, and telephone numbers of the relevant employees. The EEOC then learned that McLane had used the evaluation nationwide, and expanded the scope of its investigation both geographically and substantively (to investigate whether McLane had discriminated against its employees on the basis of age) and therefore issued subpoenas requesting pedigree information as it related to its new investigation. Again, McLane refused to provide the pedigree information, leading the EEOC to seek enforcement of its subpoenas at the district court.

Quashing the subpoenas issued by the EEOC, the district court found that the pedigree information sought by the agency was not “relevant” to the charges because “an individual’s name, or even an interview he or she could provide if contacted, simply could not shed light on whether the [evaluation] represents a tool of . . . discrimination.” The Ninth Circuit reversed after applying a de novo review, holding that the district court erred in finding the pedigree information irrelevant, despite also questioning in a footnote why de novo review was applicable as other circuits “appear[ed] to review issues related to enforcement of administrative subpoenas for abuse of discretion.”

In a decision written by Justice Sonia Sotomayor, the Supreme Court remanded the matter, explaining that when determining the appropriate standard of appellate review of a district court’s decision, it typically considers two factors—“whether the ‘history of appellate practice’ yields an answer” and “whether, ‘as a matter of the sound administration of justice, one judicial actor is better positioned than another to decide the issue in question’” Both factors pointed towards the application of the abuse of discretion standard of review.

As to the first factor, the Court observed that appellate courts have a long-established practice of reviewing a district court’s decision to enforce or quash an administrative subpoena under an abuse of discretion standard. The Court particularly noted that every circuit court that has considered the issue of enforcement of a subpoena issued under the National Labor Relations Act, which grants the National Labor Relations Board with the same authority to issue subpoenas that Title VII confers on the EEOC, has held that a district court’s decision should be reviewed for abuse of discretion.

With regard to the second factor, the Court reasoned that “basic principles of institutional capacity counsel in favor of deferential review.” For example, district courts are aptly able to determine whether the evidence sought by a subpoena is relevant to the specific charge and whether the subpoena is unduly burdensome—tasks necessary to undertake in deciding whether to enforce a subpoena. Moreover, district courts’ extensive experience with similar decisions, such as determining the relevance of evidence at trial and the reasonableness of pretrial criminal subpoenas, weighs in favor of a deferential standard of review. In addition, the Court noted that deferential review is more appropriate so that litigation is not bogged down by an appellate court’s reweighing of the evidence and reconsideration of the facts, especially given that a district court’s determination concerning subpoena enforcement is merely a “‘satellite’ proceeding […] designed only to facilitate the EEOC’s investigation.”

The Court was not persuaded by amicus’ arguments that affording deferential review to a district court’s decision conflicts with appellate decisions directing courts to defer to the EEOC’s determination that the evidence it seeks is relevant, stating that a court need not defer to the agency on this issue, but rather, need only be mindful of the “agency’s broad authority to seek and obtain evidence.” The Court also disagreed with amicus’ assertion that the constitutional underpinnings of EEOC v. Shell Oil Co., 466 U. S. 54 (1984) require application of a different standard, explaining “not every decision that touches on the Fourth Amendment is subject to a searching review,” and that subpoenas which implicate privacy interests protected by the Fourth Amendment are routinely reviewed for abuse of discretion.

The Court concluded that a district court’s decision to enforce an EEOC subpoena should not be reviewed de novo, but rather for abuse of discretion. The Court therefore remanded the case and instructed the Ninth Circuit to review the district court’s decision to quash the subpoena under the appropriate standard.

Justice Ruth Bader Ginsberg wrote a separate opinion concurring in part and dissenting in part, indicating that she concurred with the majority’s opinion that abuse of discretion is the appropriate standard for reviewing district court decisions concerning agency subpoenas. However, she stated that the district court erred as a matter of law in quashing the subpoena as it demanded that the EEOC to make a showing beyond relevance to obtain the requested information, and therefore the judgment of the Ninth Circuit need not be disturbed.