Limiting Subpoena Power

As you might have heard, the Supreme Court issued a ruling this week in the case of McLane Co. Inc. v. Equal Employment Opportunity Commission.

Monday’s ruling addressed the standard of review for a district court in determining whether to enforce or quash an EEOC-issued subpoena, with the Court reversing the Ninth Circuit’s judgment and holding that federal appellate courts must review a district court’s decision whether to enforce an EEOC subpoena for abuse of discretion, and not de novo.

The case centered on a former McLane Co. employee’s claim that the Temple, Texas-based supply chain services provider discriminated against her on the basis of her gender.

In 2007, Damiana Ochoa took three months of maternity leave from her job at McLane, which requires new employees and workers returning from medical leave to undergo a physical evaluation if their job is physically demanding—which Ochoa’s was, according to court documents. Ochoa attempted the evaluation on three separate occasions, and failed to pass each time. She was subsequently fired, which led to her filing a charge of gender discrimination with the EEOC.

As part of its investigation, the EEOC issued subpoenas to McLane, requesting the names, Social Security numbers and contact information for other employees that had been required to take the same evaluation. The EEOC filed actions to enforce the subpoenas after McLane refused to comply with that request.

Finding that the aforementioned information was not relevant to the charges, a federal district court refused to enforce the subpoenas. The Ninth Circuit reversed that decision, determining that the district court had erred in characterizing the information as irrelevant.

The Supreme Court’s decision to overturn that Ninth Circuit ruling offers “a good reminder that there are limits to the EEOC’s subpoena power,” says Melissa Raphan, a Minneapolis-based partner at Dorsey & Whitney.

“The practical effect of this decision for employers is twofold,” says Raphan, who is also chair of the firm’s labor and employment group. “First, it is a good reminder that the EEOC does not enjoy unfettered discretion to obtain information about other current and former employees. Second, the battleground to push back on the EEOC’s subpoena is in the district court.”

The EEOC’s subpoena power “does not allow the agency to bypass the burden of showing that the material is relevant, and, even if relevant, the employer can still show that the request is unduly burdensome.”

Ultimately, the decision’s impact on employers figures to be “somewhat limited in scope,” says John Alan Doran, a Scottsdale, Ariz.-based partner at Sherman & Howard.

Noting that only the Ninth Circuit took the position that it could review these trial court decisions “from scratch,” Doran adds that “every other jurisdiction has held that a trial court’s decision to quash or modify the scope of an EEOC opinion is subject to searching review by the appellate courts.”

As such, the decision directly affects only those employers doing business within the Ninth Circuit, continues Doran.

That said, “there is useful language for all courts to consider with respect to the scope of the EEOC’s subpoena power that employers will likely use in future run-ins with the EEOC throughout the country.”

The case is “largely about whose ox is getting gored, so it is hard to describe the decision as pro- or anti-employer,” says Doran. “In cases where an employer fails to convince a trial court to modify or quash an EEOC subpoena, this decision makes it that much harder to reverse the trial court’s decision on appeal. But where an employer successfully convinces a trial court to modify or quash a subpoena, its likelihood of success on appeal of that issue is considerably better.”