In McLane Co., Inc. v. Equal Employment Opportunity Commission, 581 U.S. --, -- S. Ct. --, 2017 WL 1199454 (2017), the United States Supreme Court was asked to decide whether a federal appellate court should review a district court’s decision to enforce or quash an Equal Employment Opportunity Commission (“EEOC”) subpoena under a de novo or abuse of discretion standard. The Court ruled yesterday (April 3) that an abuse of discretion standard should apply and, in reaching this decision, the Court reiterated that the EEOC has broad subpoena power.
The facts relevant to the EEOC’s investigation in the underlying matter were not critical to the Supreme Court’s decision. The federal district court had determined that the EEOC’s request for “pedigree information” was not relevant to the pending charge of discrimination. On appeal, the United States Court of Appeals for the Ninth Circuit reversed, reviewing the district court’s decision under a de novo standard and finding that the district court erred when it found that the “pedigree information” was irrelevant. A more detailed review of the Ninth Circuit’s decision, including the factual background of this case, can be reviewed here. The Supreme Court granted certiorari to resolve the circuit split on the appropriate standard of review.
In finding that a district court’s decision to enforce or quash a subpoena issued by the EEOC should be reviewed under an abuse of discretion standard, the Court first relied on what it called “the longstanding practice of the courts of appeal” to review an administrative subpoena under an abuse of discretion standard. The Court noted that this practice predates the enactment of Title VII of the Civil Rights of 1964 (“Title VII”) and referenced the review of subpoenas issued by the National Labor Relations Board (“NLRB”) as an example. According to the Court, when Congress amended Title VII to authorize the EEOC to issue subpoenas, it did so knowing this practice of deferential appellate review.
The Supreme Court also relied on the principle of “institutional capacity” as basis to favor an abuse of discretion standard. In this regard, the Court noted that a district court’s decision to enforce or quash a subpoena depends on the facts of each case and a district court is best suited to make these determinations because district courts are accustomed to making these “fact-intensive, close calls.” The Court further noted that a district court’s evaluation as to whether the information sought by a subpoena is relevant or unduly burdensome is “not amenable to broad per se rules.” The Court also recognized that district courts regularly make determinations about relevance in other similar contexts, such as determining what evidence is relevant at trial.
In reaching this decision, the Supreme Court also reiterated that the EEOC has broad subpoena power. To this end, the Court commented that Title VII “confers a broad right of access to relevant evidence” and it empowers the EEOC to “have access to . . . any evidence of any person being investigated or proceeded against that relates to unlawful employment practices[.]” In addition, the Court commented that, when a district court reviews the enforcement of an EEOC subpoena, the district court should be “cognizant of the ‘generou[s]’ construction that courts have given the term ‘relevant.’” If a district court concludes that the information sought in an EEOC subpoena is relevant, it is supposed to enforce the subpoena unless the employer demonstrates the subpoena is “too indefinite,” “has been issued for an ‘illegitimate purpose,’” or is “unduly burdensome.”
The Supreme Court’s decision in McLane Company is important in that it illustrates the broad investigatory power of the EEOC and the broad discretion district courts have when enforcing EEOC subpoenas. Although the EEOC’s reach during an investigation is not unlimited, what constitutes “relevant” information generally is defined broadly. Companies should coordinate closely with counsel when responding to EEOC charges and try to develop strategies that manage costs and limit the scope of investigations.