Secrets and Lies: The Need for a Definitive Rule of Law in Pretext Cases

Author:Catherine J. Lanctot
Position::Professor of Law, Villanova University Law School

I. Introduction II. From Mcdonnell Douglas To Hicks III. Hicks Revisited-Reeves V. Sanderson IV. Putting The Rule Back Into "Rule of Law"-The "Pretext-Always" Rule A. Closing The Loopholes In Reeves. B. Secrets and Lies: Eliminating the Secret Nondiscriminatory Reason. V. Conclusion

Professor of Law, Villanova University Law School. I would like to express my appreciation to my colleague, Ann Juliano, and to the participants in the symposium, for their helpful comments and suggestions.

I. Introduction

The Supreme Court's decision in Reeves v. Sanderson Plumbing, Inc.1 was its seventh attempt in nearly thirty years to establish a rule of law for circumstantially proving an individual disparate treatment case.2 The Court's inability to provide clear guidance in individual disparate treatment cases, which I will also call "pretext cases," is particularly troubling because such cases are the most common ones brought under employment discrimination laws. Each time the Court has spoken on this question, the lower courts have struggled to make sense of what it said, developing their own versions of the rule the Court purported to establish. The variations in the pretext rules may be called "pretext-plus," "pretext-minus," or even "pretext-maybe." At bottom, however, the disarray of the lower federal courts that has persisted for more than twenty years is the product of the Court's refusal to set down a rule of law that would govern pretext cases.

As a review of the precedent indicates, despite sometimes heated rhetoric in recent opinions, the Supreme Court has adhered to the same basic model for circumstantial proof in pretext cases for nearly thirty years. I will further show that the ongoing confusion in the lower courts over the method of proof has resulted from the Court's unwillingness to provide a definitive rule of law to be applied in all pretext cases. The lower courts have been given ample loopholes through which to limit or expand the scope of pretext cases at will. These loopholes have generated woeful uncertainty for litigants. The Reeves case fits this pattern neatly, and one can easily anticipate that it is likely to produce the same results in the lower courts. For this reason, I advocate the development of a definitive rule in this area. The only way to ensure that the federal antidiscrimination laws are applied uniformly throughout the country is for the Court to stop creating loopholes in its pretext opinions, and instead to establish a fair rule to be applied consistently in pretext cases. In my view, the rule that would be most fair to plaintiffs and defendants, and which best serves the purposes of federal law, is a modified version of the pretext-only rule that some courts used prior to Hicks. Under my version of the pretext-only rule, which I call the "pretext-always" rule, a plaintiff is entitled to judgment as a matter of law by successfully proving the following: (1) all the elements of the prima facie case, (2) the falsity of the defendant's proffered explanation, and (3) the falsity of any other explanation reasonably inferred from the record as a whole.

This rule would make it more difficult for federal judges to interpose their own misgivings about employment discrimination laws for the judgments of juries. It also would provide defendants with additional protection against unwarranted findings of unlawful discrimination. The rule would address directly the judicial concern about employers being unfairly penalized for giving pretextual reasons that conceal secret, nondiscriminatory reasons for their actions. In addition, it would also remove the incentive for employers to lie about their true motivation. The pretext-always rule will uphold the national policy of equal treatment in the workplace as expressed through federal antidiscrimination laws. In short, under the pretext-always rule, the employer will no longer be able to avoid liability by relying either on secrets or lies.

II. From Mcdonnell Douglas To Hicks

If one examines the teachings of the Court in its seven leading pretext decisions, one finds that there has been very little change in the basic framework it established in the landmark case of McDonnell Douglas Corp. v. Green.3 Those requirements are familiar to us by now: the establishment of the prima facie case, with a presumption of impermissible discrimination; the rebuttal of that presumption by submitting, although not proving, a legitimate nondiscriminatory reason for the employment action; and the proof by a preponderance of the evidence that the reason advanced was not the true reason, but rather a pretext for discrimination. The Court has refined this analysis over time, to be sure, and in recent years has focused particularly on the requirement that the finding at the pretext stage be a finding of "pretext for discrimination."4 Nevertheless, one could safely say that there is little difference between the initial model set forth in 1973 by Justice Powell for a unanimous Court in McDonnell Douglas and that reaffirmed in 2000 by Justice O'Connor for a unanimous Court in Reeves.

The reason that the Court has had to repeat itself over the last thirty years is that the lower courts have persisted in establishing different rules of proof for pretext cases, producing splits among the circuits that the Court has felt compelled to resolve. The rule of proof that has caused this split is the so-called "pretext-plus" rule, which I identified in 1991 as prevalent in certain courts of appeals.5 Under that rule, which emerged after the Court's decision in Burdine v. Texas Department of Community Affairs,6 a plaintiff may not prevail merely by proving pretext at the third stage of the McDonnell Douglas formulation, but rather must have additional "plus" evidence to establish that the pretextual reason offered by the defendant concealed a discriminatory reason, rather than some other unstated reason.7 The courts that followed this rule, including the Court of Appeals for the Fifth Circuit, insisted on some "plus" evidence such as comparative evidence, statistical analysis, and even direct evidence, without ever precisely quantifying when such evidence would suffice to prove discrimination.8 At times, one could have speculated that nothing short of an employer confession of liability would meet the high threshold set by some pretext-plus courts for proving employment discrimination circumstantially.

The pretext-plus rule was inconsistent with the plain language of Burdine.9 In that unanimous opinion, authored by Justice Powell, the Court had said quite clearly:

The plaintiff retains the burden of persuasion. She now must have the opportunity to demonstrate that the proffered reason was not the true reason for the employment decision. This burden now merges with the ultimate burden of persuading the court that she has been the victim of intentional discrimination. She may succeed in this either directly by persuading the court that a discriminatory reason more likely motivated the employer or indirectly by showing that the employer's proffered explanation is unworthy of credence.10

That language appeared to undercut the theory of the pretext-plus courts, which was that it was inappropriate to infer discrimination without more than just a showing of pretext.

In 1993, in an attempt to resolve the deepening split among the circuits, the Supreme Court issued its opinion in St. Mary's Honor Center v. Hicks.11 That 5-4 decision has been widely criticized for undermining traditional assumptions about the prevalence of employment discrimination generally, and for imposing too great a burden on plaintiffs in pretext cases.12 In particular, Hicks flatly rejected the "pretext-only" rule that would mandate entry of judgment for a plaintiff who proved pretext. Justice Scalia's opinion disavowed various portions of the Burdine opinion that would have supported the "pretext-only" rule, including the passage quoted above.13 He insisted that "a reason cannot be proved to be 'a pretext for discrimination' unless it is shown both that the reason was false and that discrimination was the real reason.14 Moreover, the extremely vituperative language used by both Justice Scalia on behalf of the majority and Justice Souter for the four dissenters suggested that the Justices believed they were resolving a controversial issue with far-reaching significance.15 Reading the harsh debate in Hicks over the proper treatment of "lying defendants," one might easily have concluded that the Court was about to adopt a pro-employer rule of proof that would permanently alter the landscape of disparate treatment cases.

A careful reading of Hicks revealed that it had not imposed the pretext-plus rule as a blanket rule of decision in disparate treatment cases, although much of Justice Scalia's opinion gave comfort to the courts that had adhered to that rule. If one hacks through the hyperbole, hypotheticals, repetitions, and occasional insults that dot the majority opinion, one ultimately uncovers a short passage that seems strangely inconsistent with the rest of the discussion. In language that soon became the focus of litigants and the courts, the Hicks majority stated:

The factfinder's disbelief of the reasons put forward by the defendant (particularly if disbelief is accompanied by a suspicion of mendacity) may, together with the elements of the prima facie case, suffice to show intentional discrimination. Thus, rejection of the defendant's proffered reasons will permit the trier of fact to infer the ultimate fact of intentional discrimination,... . 16 One could be forgiven for reading the quotations from Burdine and Hicks and concluding that the Court had done nothing but repeat itself. It is undeniable that the holding of Hicks rejected the mandatory entry of judgment for a plaintiff who successfully proved pretext. Nevertheless, the language I have quoted was equally clear in rejecting the pretext-plus rule that would mandate entry of judgment for a defendant in a pure pretext case. To the extent that the Court changed anything about pretext law in Hicks, the five-member majority reemphasized that the ultimate finding must be pretext for discrimination, and that a mandatory finding for plaintiff...

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