EEOC v. Total System Services, Inc.

221 F.3d 1171

• Court: Court of Appeals for the Eleventh Circuit
• Decided: August 7, 2000
• Docket: 99-13196
• Status: Published

Opinion

[PUBLISH]

IN THE UNITED STATES COURT OF APPEALS FOR THE ELEVENTH CIRCUIT FILED ------------------------------------------- U.S. COURT OF APPEALS No. 99-13196 ELEVENTH CIRCUIT AUGUST 7, 2000 -------------------------------------------- THOMAS K. KAHN CLERK D. C. Docket No. 96-00147-CV-4-DF-4

EQUAL EMPLOYMENT OPPORTUNITY COMMISSION,

Plaintiff-Appellant,

versus

TOTAL SYSTEM SERVICE, INC.,

Defendant-Appellee.

---------------------------------------------------------------- Appeal from the United States District Court for the Middle District of Georgia ---------------------------------------------------------------- (August 7, 2000)

Before EDMONDSON, HULL, and WOOD*, Circuit Judges.

_______________

* Honorable Harlington Wood, Jr., U.S. Circuit Judge for the Seventh Circuit, sitting by designation.

EDMONDSON, Circuit Judge: Plaintiff, the Equal Employment Opportunity Commission (“EEOC”), brought

suit on behalf of an employee of Defendant, Total Systems Services, Inc., alleging that

the employee was terminated in retaliation for engaging in statutorily protected

conduct under Title VII. The district court granted summary judgment for Defendant.

We affirm.

BACKGROUND

From November 1990 until October 1993, Lindy Wright Warren worked for

Defendant. In October, Defendant terminated Warren’s employment on the grounds

that she had lied in an internal investigation of a supervisor’s alleged sexual

harassment. The EEOC now brings suit on Warren’s behalf, alleging that her

termination was unlawful retaliation under Title VII.

In October 1993, Susan Norwood, a coworker of Warren, complained to

Assistant Department Manager Eric Seldon that supervisor Arthur Wimberly had

been sexually harassing some female employees. The complaint reached Total

Systems’s Human Resources Management Division (“HRMD”). HRMD conducted

an investigation into the complaint. Eight women, who had worked with Wimberly,

were interviewed and many confirmed that he had engaged in sexually harassing

2 conduct. And at least three men were interviewed, two of whom stated that they were

aware of some objectionable conduct by Wimberly. The investigators concluded that

Wimberly engaged in sexual harassment. He was fired.

During the investigation, one of the male interviewees said that he had heard

a rumor that Wimberly had come up to female workers, unzipped his pants, and had

said something like “I’ve got your lunch right here.” As part of the investigation,

women were asked about this rumored incident.

Warren was the only employee who stated she observed this zipper incident.1

Warren told the investigators that two co-workers, Susan Norwood and Brenda

Silvestri, were present during the incident. But then, although Norwood and Silvestri

confirmed some of Wimberly’s harassing conduct, these women denied witnessing

the zipper incident. This allegation was the only story about Wimberly that the

investigators were unable to corroborate. Warren reaffirmed her story when

questioned by then Senior Vice President of Human Resources, Elizabeth James.

James became convinced that Warren had not told the truth about this incident, and

Warren was fired for lying during an investigation.

Warren, pursuant to Defendant’s open-door policy, discussed her termination

with Total Systems Vice Chairman of the Board Kenneth Evans. Evans ordered a

1 Warren states in her deposition that Wimberly “reached for his zipper and said this is lunch.”

3 reinvestigation into the incident to determine whether she had fabricated the story or

the statement was merely uncorroborated. James conducted the reinvestigation.

Norwood and Silvestri again denied witnessing the incident. Norwood declared

that it would have been impossible for her to miss the incident Warren described.

Moreover, Norwood said that Warren had come to Norwood’s house and tried to

convince her that the incident had indeed taken place. Following the reinvestigation,

Warren’s termination was allowed to stand.

Warren complained to the EEOC about her termination. The EEOC filed suit,

alleging that Warren had been fired in retaliation for complaining about supervisor

sexual harassment. The EEOC specifically claims Warren was fired for participating

in the employer’s investigation and opposing what she believed was an unlawful

employment practice.

Defendant moved for summary judgment. The district court granted

Defendant’s motion. The court said that the EEOC had failed to establish the first

element of the prima facie case for retaliation: that Warren had engaged in statutorily

protected activity. The EEOC filed a motion for reconsideration. The district court

denied this motion and affirmed its earlier judgment; the district court wrote that the

grant of summary judgment was also proper because the EEOC failed to show

causation or pretext.

4 DISCUSSION

We review a district court’s grant of summary judgment de novo, viewing the

evidence in the light most favorable to the nonmoving party. See Merritt v. Dillard

Paper Co., 120 F.3d 1181, 1182, 1184 (11th Cir. 1997).

At the outset, we examine whether Warren’s taking part in her employer’s

internal investigation of sexual harassment allegations constitutes protected activity

at all under Title VII. Title VII’s retaliation provisions do protect certain kinds of

activity. Under the opposition clause, an employer may not retaliate against an

employee because the employee “has opposed any practice made an unlawful

employment practice by this subchapter.” 42 U.S.C. § 2000e-3 (a). And, under the

participation clause, an employer may not retaliate against an employee because the

employee “has made a charge, testified, assisted, or participated in any manner in an

investigation, proceeding, or hearing under this subchapter.” Id.

First, the EEOC contends that Warren engaged in activity protected by the

participation clause. We cannot agree. The participation clause covers participation

in “an investigation . . . under this subchapter,” that is, an investigation under

subchapter VI of Chapter 21 of Title 42 (42 U.S.C. §§ 2000e - 2000e17). 42 U.S.C.

§ 2000e-3(a). This clause protects proceedings and activities which occur in

5 conjunction with or after the filing of a formal charge with the EEOC; it does not

include participating in an employer’s internal, in-house investigation, conducted

apart from a formal charge with the EEOC.2 See Silver v. KCA, Inc., 586 F.2d 138,

141 (9th Cir. 1978) (stating that participation means “participation in the machinery

set up by Title VII to enforce its provisions”). We conclude that, because no EEOC

complaint had been filed before Warren’s termination, her taking part in Defendant’s

internal investigation did not constitute protected expression under the participation

clause of Title VII.3

2 So, at a minimum, some employee must file a charge with the EEOC (or its designated representative) or otherwise instigate proceedings under the statute for the conduct to come under the participation clause. See Booker v. Brown & Williamson Tobacco Co., 879 F.2d 1304, 1313 (6th Cir. 1989) (concluding that any protected activity by an employee prior to the instigation of statutory proceedings must come under opposition clause because instigation of statutory proceedings is prerequisite to protection under participation clause); Burns v. Republic Sav. Bank, 25 F. Supp.2d 809, 828 (N.D. Ohio 1998) (“Participation requires the actual filing of a charge . . . .”); see also Johnson v. University of Cincinnati, 215 F.3d 561, 581 (6th Cir. 2000) (“To establish a claim of retaliation under the participation clause, Plaintiff must make a prima facie case by showing that Defendants discharged him because he filed a claim with the EEOC.”); Byers v. Dallas Morning News, Inc., 209 F.3d 419, 428 (5th Cir. 2000)(“In the instant case, the ‘participation clause’ is irrelevant because Byers's [sic] did not file a charge with the EEOC until after the alleged retaliatory discharge took place.”). The parties cite no case holding an employee's taking part in an internal investigation to be protected activity under the participation clause when no EEOC charge had been filed. 3 The EEOC asserts that -- in the light of the Supreme Court’s recent decisions in Faragher v. City of Boca Raton, 118 S. Ct. 2275, 2293 (1998), and Burlington Indus., Inc. v. Ellerth, 118 S. Ct. 2257, 2270 (1998) -- the participation clause must encompass taking part in an employer’s internal investigation, apart from the filing of an EEOC complaint. According to the EEOC, these decisions essentially made reporting an incident of harassment to the employer a new prerequisite to filing a claim. We disagree with the EEOC’s use of these important decisions. These decisions decided the proper level of vicarious liability that employers have for the acts of supervisors. Cf. Borgo v. Goldin, 204 F.3d 251, 255 n.4 (D.C. Cir. 2000) (concluding that employee’s activity came under opposition, rather than participation clause, because she complained of retaliation “not against her

6 Second, the EEOC argues that Warren’s statement is protected under the

opposition clause. But, even if her acts might otherwise have constituted protected

expression under the opposition clause, the district court was correct in granting

summary judgment for Defendant because the EEOC has failed to show pretext to

rebut Defendant’s proffered legitimate nondiscriminatory reason for terminating

Warren.

The EEOC says that an employee’s speech in opposition is protected -- that is,

cannot be the basis for negative employment acts -- unless the employee actually lied.4

According to the EEOC, that the employer has a good faith belief that the employee

lied is insufficient to justify adverse employment action. Thus, the EEOC contends

that summary judgment cannot be granted for the employer if a disputed issue of

official EEO complaints, but against [the] memorandum she wrote to her supervisor opposing discrimination she perceived from him”). We do not believe Congress intended to protect absolutely every sexual harassment complaint made to an employer -- no matter how informal or knowingly false -- as a protected activity under the participation clause. The statute’s opposition clause would be rendered largely meaningless, having been engulfed by the participation clause. This case is materially different from our decision in Clover v. Total System Servs., 176 F.3d 1346,1353 (11th Cir. 1999), in which we concluded that an employee’s participation in an employer’s internal investigation was protected under the participation clause when the investigation was conducted by the employer in response to receiving a notice of charge of discrimination from the EEOC (which informed the employer that evidence submitted by the employer will be considered by the EEOC in its investigation). In this case (unlike in Clover), no pertinent employee had filed a charge with the EEOC yet, nor had the employer received one from the EEOC. See Booker v. Brown & Williamson Tobacco Co., 879 F.2d 1304, 1313 (6th Cir. 1989) (concluding that statute should be read literally and stating that activity of employee before instigation of statutory proceedings comes under opposition clause, because the filing of a charge or complaint with the EEOC is a prerequisite to protection under participation clause). 4 Of course, neither we, nor the EEOC, know for certain whether Warren lied or not.

7 material fact exists on the question of whether the employee had actually lied. The

EEOC argues that an employer must bear the risk of Title VII liability if the employer

fires an employee who did not actually lie even when the employer had good reason

to believe the employee had lied. We cannot agree.

Even if false statements made in the context of an EEOC charge (per the

participation clause) are protected and cannot be grounds for dismissal or discipline,

see Pettway v. American Cast Iron Pipe Co., 411 F.2d 998, 1007 (5th Cir. 1969)

(concluding that employee cannot be fired for anything written in EEOC charge), this

extreme level of protection for untruth is not afforded to false statements made under

the opposition clause. See Vasconcelos v. Meese, 907 F.2d 111, 113 (9th Cir. 1990)

(“Accusations made in the context of charges before the Commission are protected by

statute; charges made outside of that context are made at the accuser’s peril.”).

The statutory retaliation provision has two distinct components. Both offer

employees some protection, but that these two components should offer two different

levels of protection is consistent with plain reading and purposes of the statute.5 The

participation clause includes activity done in connection with proceedings conducted

by the federal government and its agencies: an employee has invoked the jurisdiction

5 See United States v. Ron Pair Enter., Inc., 109 S. Ct. 1026, 1030 (1989) (noting that a statute must be read as “mandated by [its] grammatical structure”); Kornblau v. Dade County, 86 F.3d 193, 195 (11th Cir. 1996) (stating that it is court’s duty to give effect to every clause of statute).

8 of the federal government through its agency, the EEOC. And we have held that

expansive protection is available for these adjudicative kinds of proceedings run by

the government. See Pettway, 411 F.2d at 1007.

Opposition clause acts, however, are taken outside of the context of a

government review and, instead, are taken in the context of the ordinary business

environment and involve employers and employees as employers and employees. As

in this case, whether to fire an employee for lying to the employer in the course of the

business’s conduct of an important internal investigation is basically a business

decision; this decision, as with most business decisions, is not for the courts to second-

guess as a kind of super-personnel department. See Damon v. Fleming Supermarkets

of Fla., Inc., 196 F.3d 1354, 1361 (11th Cir. 1999) (noting that court is not concerned

with whether employment decision was prudent or fair but only with whether it was

motivated by unlawful discriminatory animus).

The EEOC argues that Defendant, to avoid liability under Title VII, must prove

that Warren, in fact, lied. But we cannot agree that an employer must be forced to

prove -- presumably in a court of law -- more than its good faith belief that a false

statement was knowingly made. In the kind of investigation involved in this case, the

employer is not acting pursuant to the statute or under color of law, but is conducting

the company’s own business.

9 When an employer is told of improper conduct at its workplace, the employer

can lawfully ask: is the accusation true? When the resulting employer’s investigation

(not tied to the government) produces contradictory accounts of significant historical

events, the employer can lawfully make a choice between the conflicting versions –

that is, to accept one as true and to reject one as fictitious – at least, as long as the

choice is an honest choice. And, at least when the circumstances give the employer

good reason to believe that the fictitious version was the result of a knowingly false

statement by one of its employees, the law will not protect the employee’s job.

False statements impair the employer’s ability to make sound judgments that

may be important to the employer’s legal, ethical and economic well-being. So, an

employer is entitled to expect and to require truthfulness and accuracy from its

employees in an internal investigation that is exploring possibly improper conduct in

the business’s own workplace.6 (For example, we readily suppose an employee -- a

nonharassing employee -- could be fired if the employer had reason to believe the

employee was concealing harassing conduct from the employer’s investigation.) And,

in carrying out its business and in making business decisions (including personnel

decisions), the employer can lawfully act on a level of certainty that might not be

enough in a court of law. In the work-a-day world, not every personnel decision

6 Courts of law are very fond of the truth and favor it on almost every occasion.

10 involving a false statement (or a cover-up) has to be treated as something like a trial

for perjury. Therefore, an employer, in these situations, is entitled to rely on its good

faith belief about falsity, concealment, and so forth. Cf. Damon, 196 F.3d at 1363 n.

3 (“An employer who fires an employee under the mistaken but honest impression that

the employee violated a work rule is not liable for discriminatory conduct.”); Sempier

v. Johnson & Higgins, 45 F.3d 724, 731 (3d Cir. 1995) (“Pretext is not demonstrated

by showing simply that the employer was mistaken.”).

Warren could properly be discharged based on Defendant’s good faith belief

that she lied in an internal investigation. In other words, Defendant offered a

legitimate nondiscriminatory reason for Warren’s termination: Defendant concluded

that she had lied in an internal investigation. See Elrod v. Sears, Roebuck & Co., 939

F.2d 1466, 1470 (11th Cir. 1991) (noting that inquiry is not whether employee was

guilty of misconduct but whether employer in good faith believed employee had done

wrong and whether this belief was the reason for the termination); see also O’Day v.

McDonnell Douglas Helicopter Co., 79 F.3d 756, 762 n.6 (9th Cir. 1996) (“[A]n

employer’s discrimination does not immunize its employees from consequences of

their wrongdoing.”).

We allow the district court’s conclusion that the EEOC has failed to show

pretext. The EEOC presents no evidence that Defendant lacked a good faith belief

11 that Warren lied. The record compels finding a good faith belief.

CONCLUSION

Because the EEOC has failed to show pretext for Warren’s proffered legitimate

nondiscriminatory reason for terminating her employment, the district court’s grant

of summary judgment for the Defendant in this case is AFFIRMED.