The Third Circuit Court of Appeals has again created a circuit split by disagreeing with decisions from the Fifth and Seventh Circuit Courts of Appeals, which have held that Title VII of the Civil Rights Act of 1964 provides the exclusive remedy for employees alleging discrimination on the basis of sex in federally funded educational institutions. In Doe v. Mercy Catholic Medical Center, No. 16-1247 (March 7, 2017), the Third Circuit held that Title IX provides an alternative remedy to address such claims of discrimination.

Factual Background

Mercy Catholic Medical Center is a private teaching hospital that operates accredited residency programs. Sometime after joining Mercy’s diagnostic radiology residency program in 2011, Jane Doe began receiving unwanted attention from the director of the residency program, Dr. James Roe. After Jane Doe sent Dr. Roe a text message stating that she did not wish to pursue a relationship with him, Dr. Roe reported the matter to Mercy’s human resources department. Human resources interviewed Doe and referred her to a psychiatrist for counseling sessions. No further action was taken by the human resources department, and Dr. Roe’s unwelcome verbal communications and physical behavior towards Doe continued.

Following the initial report, Doe perceived that she began receiving less training from faculty members who had close relationships with Dr. Roe, and Dr. Roe and another faculty member provided her with poor recommendation letters. Additionally, a vice president refused to rescind an incorrect report concerning her performance on an exam. Doe ultimately was discharged from the residency program.

Two years later, Doe sued Mercy Medical Center. In addition to common law claims, she alleged retaliation, quid pro quo, and hostile work environment claims under Title IX. The district court granted a motion to dismiss Doe’s Title IX claims under Federal Rule of Civil Procedure 12(b)(6) on the grounds that Mercy was not an “education program or activity” under 20 U.S.C. § 1681(a), and ruled that Doe could not use Title IX to circumvent Title VII’s requirement to file a charge with the U.S. Equal Employment Opportunity Commission (EEOC) prior to seeking judicial relief. The district court also held that the hostile work environment claim was not timely and declined to exercise supplemental jurisdiction over the common law claims. Doe appealed the dismissal of her complaint to the Third Circuit.

The Third Circuit’s Decision

The Third Circuit reversed the lower court’s decision in part. Emphasizing that Congress had used the term “education programs or activities” in operative sections of Title IX, as opposed to referring to “educational institutions” as it did elsewhere, the court determined that Title IX was not limited to entities “principally engaged in the business of providing education.” Although the court acknowledged that whether a program or activity qualified as sufficiently educational was a mixed question of law and fact, it concluded that Doe’s allegations were sufficient to allow a determination that Mercy’s operation of an accredited residency program created a mission that was in part educational, as established by the fact that Doe trained under faculty members and physicians, attended lectures and classes, took exams, and upon completion of the program, would have been eligible to take a board certification examination. The court also noted that Mercy’s affiliation with a university, which was plausibly covered by Title IX, further affirmed Mercy’s educational mission.

The court then compared Title IX and Title VII. Although it readily concluded that Doe was an “employee” who could have asserted a claim under Title VII, the court rejected the assertion that Doe was therefore prohibited from asserting a claim under Title IX. Discussing the teachings from several Supreme Court of the United States decisions, the Third Circuit concluded that Title VII was not the only avenue to address discrimination in employment, and that Congress, and not the judiciary, was the appropriate institution to address any unwanted effects that might result from the fact that certain employees might bypass the administrative requirements of Title VII if allowed to bring claims under Title IX. Based upon Supreme Court precedent, the Third Circuit also concluded that Title IX encompasses employees as well as students, and that the implied cause of action applies to employees of federally funded education programs who allege sex-based retaliation claims. In so holding, the Third Circuit explicitly parted company with the Fifth and Seventh Circuits, which have held that Title VII provides the exclusive remedy for redressing claims of sex discrimination in federally funded educational programs.

Turning to the specific claims asserted by Doe, the court held that Title IX extended to quid pro quo and retaliation claims, and found that such claims should be evaluated using the same framework applicable to similar claims brought under Title VII. It stopped short of holding that hostile work environment claims were viable under Title IX or that the continuing violation doctrine applied under Title IX because it concluded that neither ruling would result in a finding that Doe’s Title IX hostile work environment claim was timely.

Key Takeaways

Graduate medical education programs occupy a critical role in the path that physicians travel to obtain specialized training and credentials after completion of medical school, and the number of institutions sponsoring residency and fellowship programs as well as the number of specialties covered by such programs have increased since the time frame giving rise to Doe’s claims. The Third Circuit’s ruling therefore deserves close attention as it confirms, at least in the jurisdictions covered by this circuit, that individuals who believe that they have experienced sex-based discrimination may have additional options for seeking judicial redress when they do not, for whatever reason, file a charge with the EEOC. Institutions that offer “education programs or activities” that could subject them to the reach of Title IX under the court’s analysis may want to review their internal protocols for investigating and responding to sex discrimination complaints in order to ensure that those procedures effectively address such complaints and ensure that they provide sufficient training to minimize the likelihood of violations of the law. Absent such preventative measures, such institutions may risk learning of the full nature and extent of alleged violations only after a lawsuit is filed, when the direct monetary and indirect reputational consequences of such allegations are far greater for institutions and the individuals involved.