THE LAW AT WORK: Retaliation Claims: More Difficult Standards Under ‘Nassar’ and ‘Ferguson’

Establishing a prima facie case of retaliation just became a lot more difficult because of a couple of recent decisions, one from the United States Supreme Court and one from the Tennessee Court of Appeals. As a refresher, to establish a claim of retaliation under the Civil Rights Act of 1964 (Title VII) and the Tennessee Human Rights Act (THRA), a plaintiff must prove that: (1) the plaintiff engaged in a protected activity; (2) the exercise of the plaintiff’s protected rights was known to the defendant; (3) the defendant thereafter took an adverse job action against the plaintiff; and (4) there was a causal connection between the protected activity and the adverse job action.[1] These recent decisions impact the knowledge and causation requirements of retaliation claims, ultimately creating a more onerous burden for plaintiffs.

In University of Texas Southwestern Medical Center v. Nassar, the Supreme Court clarified that Title VII retaliation claims must be proved according to traditional principles of but-for causation, not the less burdensome motivating factor test.[2] In Ferguson v. Middle Tennessee State University, the Tennessee Court of Appeals held that a retaliation plaintiff is required to show that the decisionmaker, the individual who took the adverse job action against the plaintiff, had knowledge of the plaintiff’s protected activity at the time of adverse job action — it noted that general corporate knowledge is not sufficient to state a prima facie case of retaliation.[3]

In Nassar, the plaintiff, who was of Middle Eastern descent, worked in the HIV/AIDS clinic at Parkland Hospital and was a faculty member at the University of Texas Southwestern Medical Center. Plaintiff came to believe that one of his supervisors, Dr. Levine, was biased against him because he was Muslim and had a Middle Eastern heritage. Plaintiff repeatedly complained to Dr. Levine’s direct supervisor, Dr. Fitz, about Dr. Levine’s alleged discrimination and harassment.

After making arrangements to work full-time for the hospital, plaintiff resigned his faculty position, stating that the reason for his departure was harassment by Dr. Levine because of her bias against him. Dr. Levine was admittedly quite upset by the allegations. Once Dr. Fitz learned the hospital had offered Dr. Nassar the position, he protested the job offer, asserting that the hospital’s affiliation agreement with the university required that all staff physicians also be members of the university’s faculty. After Dr. Fitz’s protest, the hospital withdrew plaintiff’s job offer.

Plaintiff then filed suit alleging, among other things, that Dr. Fitz’s efforts to prevent the hospital from hiring him were in retaliation for complaining about Levine’s harassment. The jury found for the plaintiff on the retaliation claim and awarded him $400,000 in back-pay and $3 million in compensatory damages.[4] On appeal, the Fifth Circuit affirmed based on the reasoning that retaliation claims require only a showing that retaliation was a motivating factor for the adverse employment action.

In a 5-4 opinion, the Supreme Court held employee retaliation claims filed under Title VII must be proved according to traditional principles of but-for causation, not the lessened “motivating factor” test stated in the 42 U.S.C. § 2000e-2(m) for status-based discrimination cases. Justice Kennedy explained that the “motivating factor” provision only applies to claims of discrimination — not retaliation.

In arriving at the but-for causation standard, the court held that retaliation claims require a showing that an employer acted “because” of the protected conduct. In Gross v. FBL Financial Services Inc., the court had previously interpreted the similar phrase “because of … age” in the Age Discrimination in Employment Act of 1967 (ADEA) to require but-for causation.[5] Thus, the court held, “the proper conclusion [in Nassar], as in Gross, is that Title VII retaliation claims require proof that the desire to retaliate was the but-for cause of the challenged employment action.”[6]

While the Supreme Court dealt with the causation element, the Tennessee Court of Appeals, Western Section, grappled with the employer knowledge requirement. In Ferguson, the plaintiff, who was of Japanese American ancestry, worked in the maintenance department at Middle Tennessee State University (MTSU). The plaintiff had sustained injuries from workplace incidents and general wear and tear over the years. As a result of these injuries, he was placed under certain medical restrictions. However, plaintiff alleged that his supervisor unlawfully discriminated against him by assigning him work that violated his medical restrictions. Plaintiff ultimately underwent surgery in August 2002. While he was recuperating from surgery, plaintiff filed an EEOC charge of discrimination on the basis of race and national origin. He returned to work on March 17, 2003, and he filed suit on the discrimination claim on March 27, 2003.

Plaintiff testified that once he returned to work his supervisor “continue[d] after the lawsuit was filed performing the same actions that made him bring [the lawsuit in the first place].”[7] In April 2004, plaintiff filed his second lawsuit, alleging that his supervisor retaliated against him for the EEOC complaint and related lawsuit by giving him assignments that required him to work outside his medical restrictions. The discrimination and retaliation lawsuits were consolidated, and the jury found in favor of MTSU on the discrimination claim. However, the jury found in favor of the plaintiff on the retaliation claim, and awarded $3 million in compensatory damages.

On appeal, the court focused its inquiry on the knowledge element of the retaliation claim. It was undisputed that some members of the MTSU administration knew of the plaintiff’s protected activity (i.e., his EEOC charge and related lawsuit). Plaintiff argued that this general “corporate knowledge” was sufficient to satisfy the second element of a prima facie case of retaliation.

The court disagreed with the plaintiff and clarified the somewhat gray area of employer knowledge of protected activity. The court reasoned:

We respectfully reject the view that “general corporate knowledge” is sufficient foundation for a claim of retaliation in employment for engaging in protected activity. Retaliatory intent or animus must abide in the mind of a living, breathing person. It is difficult to see how an entity such as a corporation can have intent or animus, retaliatory or otherwise. Consequently we are of the view that the plaintiff in a retaliation lawsuit is required to show that the decisionmaker, the individual who took the adverse job action against the plaintiff, had knowledge of the plaintiff’s protected activity at the time of the adverse job action.[8]

Applying this more stringent knowledge standard, the court concluded that plaintiff had failed to introduce any material evidence that his supervisor had knowledge of his protected activity at the time of the alleged adverse job action. Indeed, plaintiff testified that upon the advice of counsel and instructions from MTSU’s human resources department, he did not discuss his EEOC charge or his lawsuit with his supervisor or anyone else. Furthermore, the supervisor’s testimony did not reveal when she had learned of plaintiff’s protected activity. Because plaintiff had not satisfied the knowledge element of his retaliation claim, the court reversed the trial court and ordered that the case be dismissed, negating the $3 million jury verdict.

So what can employers take away from Nassar and Ferguson? Nassar and its but-for causation standard is binding on all Title VII retaliation claims. It will also likely be applied to state claims of retaliation under Tenn. Code Ann. § 4-21-301 because Tennessee courts look to federal interpretation of Title VII cases in deciding THRA cases.[9] Ferguson, on the other hand, is currently an unreported case and must still hold up on appeal.[10] But, if it remains good law, one thing is clear — retaliation claims in Tennessee just got harder to prove.

Even if a plaintiff can satisfy the knowledge requirement, he or she must then prove the protected activity was the “but-for” cause (i.e., the unlawful retaliation would not have occurred but for the protected activity) and not just a motivating factor. As Justice Kennedy noted in Nassar, retaliation claims “are being made with ever increasing frequency.”[11] These two decisions may not lessen the number of claims filed, but they certainly have enabled employers to get more of them dismissed on summary judgment.

Notes

  1. Niswander v. Cincinnati Ins. Co., 529 F.3d 714, 720 (6th Cir. 2008); Sykes v. Chattanooga Hous. Auth., 343 S.W.3d 18, 29 (Tenn. 2011).
  2. 133 S. Ct. 2517, 186 L. Ed 2d 503 (2013).
  3. No. M2013-00890-COA-R3-CV, 2013 Tenn. App. LEXIS 221 (Tenn. Ct. App. March 28, 2013).
  4. The District Court later reduced the compensatory damages to $300,000.
  5. 557 U.S. 167 (2009).
  6. 133 S. Ct. at 2528.
  7. 2013 Tenn. App. LEXIS 221, at *7.
  8. Id. at **22-23.
  9. Frazier v. Heritage Fed. Bank, 955 S.W.2d 633, 636 n. 1 (Tenn. Ct. App. 1997).
  10. The plaintiff in Ferguson filed his R. 11 Application for Permission to Appeal with the Tennessee Supreme Court on May 29, 2013. As of the time of publication, the Court has not yet ruled on whether to hear Ferguson’s appeal.
  11. 133 S. Ct. at 2531.

Edward G. Phillips EDWARD G. PHILLIPS is a lawyer with Kramer Rayson LLC in Knoxville, where his primary areas of practice are labor and employment law. He graduated with honors from East Tennessee State University and received his law degree from the University of Tennessee College of Law in 1978 with honors, and as a member of The Order of the Coif. He is a former chair of the Tennessee Bar Association’s Labor and Employment Law Section.

BRANDON L. MORROW is an associate with Kramer Rayson LLC in Knoxville where his primary areas of practice are labor and employment, and litigation. He earned a bachelor’s degree from the University of Tennessee and a law degree from UT College of Law in 2012.