CRST Van Expedited, Inc. v. EEOC – up for oral argument at the US Supreme Court on March 28 – started as a test of the 8th Circuit's rule that a Title VII defendant can recover its attorney's fees only if it beats the EEOC "on the merits." It has now become a test of the EEOC's newly-revealed theory that a defendant can recover attorney's fees only by obtaining a "judicially sanctioned change in the parties' legal relationship." This would mean that CRST would have needed to get the EEOC's case dismissed "with prejudice," which the EEOC says did not happen. After the EEOC sued CRST claiming violations of Title VII, the district court dismissed the EEOC's claims as to 67 individuals because the EEOC "wholly abdicated" its pre-suit duty to make separate investigations, reasonable cause determinations, or conciliation attempts as to each of the 67 individuals. CRST won, so the district court ordered EEOC to pay nearly $4.7 million in attorney's fees.
The 8th Circuit reversed. Title VII Section 706(k) allows a district court to award attorney's fees to the "prevailing party." The 8th Circuit says that defendants "prevail" only if they get a ruling "on the merits" of the EEOC's claims. CRST won because the EEOC didn't follow the proper procedures, which was not a win "on the merits," so the 8th Circuit said "no" to CRST's request for attorney's fees.
When the US Supreme Court agreed to hear this case, it was widely thought that this would be a test of the 8th Circuit's "on the merits" requirement.
The landscape changed on February 18 when the EEOC filed its Supreme Court brief. The EEOC does not rely on the 8th Circuit's legal theory at all. In what CRST is calling a "stunning about-face," the EEOC is advancing a much more logical principle, which poses this question:
"Has the defendant secured a “judicially sanctioned change in the legal relationship of the parties” … in the form of an order that bars further litigation on the plaintiff’s claim?"
CRST's reply brief exploded with the response that the EEOC has waived this argument. The EEOC never mentioned it during six years of litigation – not in the district court, not during two appeals to the 8th Circuit, and not during the certiorari stage at the Supreme Court.
Part of the EEOC's theory rests on its reading of the trial court record. The EEOC says that CRST's judgment was not "with prejudice," and thus did not bar further litigation.
CRST's response is that the EEOC is engaging in "revisionist history" in its explanation of the what's in the trial court record and what all that means. For CRST it is clear that it obtained a judgment that is with prejudice.
I'm sorry to see the parties squabbling over what's in the trial record. If the Court had known earlier that there was so much disagreement about what actually happened, then it seems doubtful that certiorari would have been granted in the first place. If the squabble continues, I can see the Court dismissing the writ of certiorari as improvidently granted. This would leave the parties where they were in the 8th Circuit – EEOC 1, CRST 0.