On Tuesday, March 1, 2011, the Supreme Court ruled that an employer could be liable under USERRA (the Uniformed Services Employment and Reemployment Rights Act) when an action of a supervisor who is motivated by antimilitary animus is a proximate cause of an employee's discharge, even if the ultimate decision maker was unaware of the antimilitary animus. Although this case – Staub v. Proctor Hospital – was brought under USERRA, the Supreme Court signaled that the analysis would apply equally to Title VII cases.

This theory of liability is referred to as the "cat's paw" because it allows an employee to hold an employer liable based on the fact that the ultimate decision maker was simply the "cat's paw" of the supervisor who was motivated by discriminatory animus. This theory derives from the language in USERRA – similar to language in Title VII – that makes an employer liable when discrimination is a "motivating factor" in an adverse employment action.

Resolving a split among the Circuits with respect to the standard used for determining liability in "cat's paw" cases – and effectively splitting the difference – the Supreme Court held that to prove liability in these cases, a plaintiff must show that the biased supervisor's discriminatory act was intended to cause adverse employment action and that the discriminatory act was a proximate cause of the ultimate employment action. The Supreme Court reversed the Seventh Circuit's decision and rejected the standard the Seventh Circuit used in finding that Staub failed to prove his military status was a motivating factor in the decision to terminate his employment. The Seventh Circuit imposed a fairly rigid standard in "cat's paw" cases by requiring the employee prove that the biased supervisor exercised "singular influence" over the decision maker such "that the decision to terminate was the product of 'blind reliance.'"

Although the Supreme Court has established a more relaxed standard for employees seeking to prove discrimination in "cat's paw" cases than the Seventh Circuit's standard, the Supreme Court has left an open question about the extent to which an employer may curtail liability by conducting an independent investigation of the alleged discrimination. The Court made clear that an investigation will not immunize an employer against liability. But it did not foreclose the possibility that such an investigation may provide the employer an opportunity to curtail liability. The specific circumstances under which an investigation may assist an employer in defending a "cat's paw" case will now be up to the lower courts.