Equal Employment Opportunity Commission v. Asplundh Tree Expert Co.

[PUBLISH]

IN THE UNITED STATES COURT OF APPEALS
FILED
FOR THE ELEVENTH CIRCUIT
U.S. COURT OF APPEALS
________________________ ELEVENTH CIRCUIT
AUGUST 7, 2003
Nos. 02-12386 & 02-13571 THOMAS K. KAHN
________________________ CLERK

D.C. Docket No. 99-00121-CV-1-MMP

EQUAL EMPLOYMENT OPPORTUNITY COMMISSION,

Plaintiff-Appellant,

versus

ASPLUNDH TREE EXPERT COMPANY,
Defendant-Appellee.

________________________

Appeals from the United States District Court
for the Northern District of Florida
_________________________
(August 7, 2003)

Before BLACK and HILL, Circuit Judges, and FITZPATRICK*, District Judge.

*
Honorable Duross Fitzpatrick, United States District Judge for the Middle District of
Georgia, sitting by designation.
HILL, Circuit Judge:

These consolidated appeals are from the dismissal of the action and the

award of attorney’s fees against the Equal Employment Opportunity Commission.

For the following reasons, we affirm the judgments of the district court.

I.

In 1993, Asplundh Tree Expert Company (“Asplundh”) contracted with the

Gainesville Regional Utilities (the “GRU”) of Gainesville, Florida, to dig ditches

and lay underground cable. The contract was to last three years, and was to expire

on October 1996.

In November of 1995, Asplundh hired Robert Lewis as a laborer. Lewis

was assigned to a three-person crew that worked in the field, digging ditches and

laying cable.

On April 1, 1996, as Lewis and the other two members of his crew were

laying cable, Pete Evans visited their work site. Evans is an employee of GRU.

He is not, nor has he ever been, an employee of Asplundh. Evans’ job for GRU is

to visit Asplundh work sites, observe the crews and inspect the work.

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 Lewis claims that when Evans visited his work site on April 1, Evans made

offensive racial jokes and even fashioned a noose from a piece of rope and placed

it on Lewis’ neck. Evans denies this claim.

Later that day, Lewis complained to the Asplundh general foreman, Larry

Mattingly, who arranged a meeting between Evans and Lewis. At the meeting,

Evans apologized for any offensive conduct, and thereafter, Lewis cannot recall

any recurring harassment when Evans would visit his work site.

Beginning in May 1996, the contract work began winding down, and GRU

started reducing the amount of work assigned to Asplundh. Asplundh, in turn,

began reducing its crews. Lewis was terminated in the second round of lay-offs.

In October, all the rest of the Gainesville crews were laid off.

Lewis contacted the Equal Economic Opportunity Commission (the

“Commission” or the “EEOC”) to pursue a complaint against GRU for Evans’

actions. After providing the EEOC investigator, Deborah West, with a narrative

of events, she advised him that his narrative failed to allege an actionable claim

against Asplundh. Lewis then submitted a revised statement.

In August of 1996, Lewis filed his charge of discrimination, alleging

disparate pay, racial harassment and retaliation. The charge specifically stated that

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Lewis was subjected to racial harassment “from Pete Evens (sic), GRU Inspector.”

Additionally, the charge alleged that Lewis was “subjected to different terms and

conditions of employment than my White co-workers (Blacks were paid lower

than Whites and denied pay increases).” Lewis acknowledged in the charge that

he was informed that his lay-off was due to a “lack of work.” He further asserted

that “no reason was given for Evens’ (sic) harassment or the different terms and

conditions of employment [pay disparity].”

The EEOC, through Investigator West, commenced an investigation of the

allegations. This investigation continued for thirty-two months. Throughout the

investigation, which focused on the disparate pay issue, Asplundh cooperated with

the EEOC.

On March 31, 1999, the Commission issued a “Letter of Determination”

finding “reasonable cause to believe the charge is true” on the harassment and

retaliation allegations. No additional facts constituting harassment or retaliation

were cited; nor did the Commission find any cause to believe that there was any

discrimination by Asplundh in pay.

On April 7, 1999, West sent a document titled “Conciliation Agreement” to

Asplundh’s General Counsel, Phillip Tatoian, in Philadelphia, Pennsylvania,

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requiring a response by April 23. This deadline provided 12 business days within

which Asplundh was required to respond regarding the Gainesville, Florida

incident. The proposal sought, inter alia, both reinstatement and front pay

(despite the termination of the project on which Lewis had worked and the closure

of the Gainesville office in 1996). It would also have required Asplundh to

provide nationwide notice to its employees of Lewis’ allegations and to conduct,

within ninety days, nationwide anti-discrimination training of all its management

and hourly employees. The proposal did not identify the EEOC’s theory of

Asplundh’s liability for GRU employee Evan’s alleged racial harassment of Lewis.

General Counsel Tatoian promptly retained a local Gainesville, Florida law

firm to investigate the Florida incident and Asplundh’s potential liability and

respond to the EEOC. On April 28, 1999, Peter Sampo, a partner in that firm,

forwarded by facsimile the following correspondence to EEOC Investigator West:

The firm has been retained to represent the Respondent in the above-
referenced matter. Your letter to General Counsel, Phillip Tatoian,
dated April 7, 1999 and enclosing a proposed Conciliation Agreement
has been forwarded to me for response. In order for me to provide
informed advice to my client about this issue, I would like to arrange
a phone call with you to discuss this case and attempt to understand
the Commission’s basis for its determination. Therefore, I ask that
you extend the time for responding to the proposed Conciliation
Agreement until we have had an opportunity to review this matter and
you and I have had an opportunity to discuss the issues.

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 The EEOC did not respond to Sampo’s letter that day or even acknowledge

having received it. Instead, the next day, on April 29, 1999, the EEOC sent

another letter to Tatoian in Philadelphia, declaring that “the Commission has not

received . . . a reply to the conciliation proposal,” that “efforts to conciliate this

charge . . . were unsuccessful,” and that “further conciliation efforts would be

futile or non-productive.”

Tatoian notified Sampo of this letter. Sampo attempted to contact West by

telephone, but was unable to reach her, leaving her a message. On May 10, 1999,

eleven days after receipt of Sampo’s letter, West left a message on Sampo’s office

voice mail stating that the “case was out of [her] hands” and that Sampo should

“contact the Regional Attorney.” Two days later, on May 12, 1999, the EEOC

filed this lawsuit.

The district court dismissed the lawsuit and awarded costs and fees to

Asplundh, holding that the EEOC had failed to meet its statutory duty to engage in

good faith conciliation.1 We review these sanctions for abuse of discretion. See

Hensley v. Eckerhart, 461 U.S. 424, 437 (1983).

1
Title VII commits the decision of whether to stay proceedings for further efforts to
conciliate or dismiss the action to the sound discretion of the trial court. See 42 U.S.C. § 2000e-
5(f)(1); EEOC v. Sears, Roebuck and Co., 650 F.2d 14 (2d Cir. 1981).

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 I.

Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. § 200e-

5(b) provides in pertinent part:

If after investigation, the Commission determines there is reasonable
cause to believe that the charge [of discrimination] is true, the
Commission shall endeavor to eliminate any such alleged unlawful
employment practices by informal methods of conference,
conciliation, and persuasion.

To satisfy the statutory requirement of conciliation, the EEOC must (1)

outline to the employer the reasonable cause for its belief that Title VII has been

violated; (2) offer an opportunity for voluntary compliance; and (3) respond in a

reasonable and flexible manner to the reasonable attitudes of the employer. EEOC

v. Klinger Elec. Corp., 636 F.2d 104, 107 (5th Cir. 1981). In evaluating whether

the EEOC has adequately fulfilled this statutory requirement, “the fundamental

question is the reasonableness and responsiveness of the EEOC’s conduct under

all the circumstances.” Id.

The EEOC asserts that the far-reaching proposal it sent to Asplundh,

coupled with a “request” to respond within twelve business days, followed by a

refusal to confer with Asplundh’s counsel whose response, though prompt, fell

beyond the arbitrary deadline set by the EEOC, constituted a bona fide effort to

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conciliate. The district court disagreed, holding that the EEOC acted in a “grossly

arbitrary manner” and “engage[d] in unreasonable conduct in failing to fulfill its

statutory requirement to conciliate the matter.”

We agree. In this case, the EEOC conducted an investigation of Lewis’

allegations for almost three years before issuing its Letter of Determination,

finding cause to believe that Asplundh had violated Title VII. During this

extended period of time, Asplundh did not apprehend that this local incident, not

involving its employee, would result in charges, so it did not retain local

Gainesville counsel to investigate the allegations.

Then, in a flurry of activity, the EEOC issued a Letter of Determination,

followed one week later by a proposed, nation-wide Conciliation Agreement,

which provided twelve business days for Asplundh’s General Counsel in

Philadelphia to accept the agreement, submit a counter proposal to the EEOC or

inform the EEOC that no agreement would be entered into. In neither of these

communications did the EEOC identify any theory on which Asplundh could be

held liable for the alleged conduct of Evans, the City of Gainesville, Florida’s

employee.

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 Upon receipt of the Letter of Determination, Asplundh promptly retained

local counsel to investigate the allegations, who responded to the proposed

Conciliation Agreement by requesting a reasonable extension of time within which

to “understand the Commission’s basis for its determination” and to adequately

prepare a response. This faxed communication was not immediately

acknowledged. Instead, the very next day the Commission sent another letter to

Asplundh, again in Philadelphia, terminating conciliation and announcing its

intent to sue.2 This action was filed thirteen days later.

Under these circumstances, it cannot be said that the EEOC acted in good

faith. In fact, its conduct “smacks more of coercion than of conciliation.” See

EEOC v. Pet, Inc., Funsten Nut Div., 612 F. 2d 1001, 1002 (5th Cir. 1980).

Despite the extended period of investigation, it appears that, once the EEOC

decided it was ready to move forward, it would tolerate no “dallying” by

Asplundh. Not even if Asplundh was given only one week between notice that,

after almost three years, the Commission found “good cause” to believe it had

violated Title VII, and its receipt of the Commission’s conciliation “proposal.”

Not even if this proposal, which included no theory of liability, demanded a

2
There is no record establishing that the Commission determined conciliation had failed
prior to receipt of Sampo’s faxed letter.

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remedy that was on the one hand, national in scope, and on the other, impossible

to perform (no reinstatement or front pay being available as the Gainesville

Asplundh project had ended three years earlier). Not even if the Commission had

received a letter evidencing Asplundh’s clear intent to resolve the matter outside

the courtroom, prior to notifying Asplundh that conciliation had been

“unsuccessful.” As we have said before, such an “all or nothing” approach on the

part of a government agency, one of whose most essential functions is to attempt

conciliation with the private party, will not do. Id.

Furthermore, we reject the Commission’s position that it had no legal

obligation to respond to Sampo’s letter. The duty to conciliate is at the heart of

Title VII. EEOC v. Radiator Specialty Co., 610 F.2d 178 (4th Cir. 1979). It clearly

reflects a strong congressional desire for out-of-court settlements of Title VII

violations. See Culpepper v. Reynolds Metals Co., 421 F.2d 888 (5th Cir. 1970). It

is a condition precedent to the Commission’s power to sue. 42 U.S.C. § 200e-

5(b).

The courts have interpreted the statute to mean precisely what it says.

Nothing less than a “reasonable” effort to resolve with the employer the issues

raised by the complainant will do. Klinger, 636 F.2d at 107. This effort must, at a

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minimum, make clear to the employer the basis for the EEOC’s charges against it.

See EEOC v. Pacific Maritime Ass’n, 188 F.R.D. 379, 381 (D.C. Or. 1999).

Otherwise, it cannot be said that the Commission has provided a meaningful

conciliation opportunity. Id.

Finally, there is no excuse for the Commission not to have kept negotiations

with Asplundh open for a reasonable time upon receiving Sampo’s letter.

Regardless of whether it was received within the arbitrary deadline established by

Investigator West, or even after the Commission had leapt to the conclusion, sine

qua non to litigation, that negotiations had failed, there was no reason for the

EEOC, upon learning of Asplundh’s retention of local counsel who desired to

pursue negotiations, not to re-open the conciliation process. The Commission

readily admits that it routinely re-opens closed conciliations when the

circumstances warrant. See Klinger, 636 F.2d at 104 (re-opened negotiations at

employer’s request); EEOC v. Costco Companies, Inc., 2000 U.S. Dist LEXIS

19586 (S.D. Ca. 2000) (EEOC continued negotiating for four months after

announcing that conciliation had failed).

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 As we said above, conciliation is at the heart of Title VII. In its haste to file

the instant lawsuit, with lurid, perhaps newsworthy,3 allegations, the EEOC failed

to fulfill its statutory duty to act in good faith to achieve conciliation, effect

voluntary compliance, and to reserve judicial action as a last resort. Under these

circumstances, the sanction of dismissal, awarding attorneys’ fees, is not an

unreasonable remedy or an abuse of the district court’s discretion. See EEOC v.

Pierce Packing Co., 669 F.2d 605, 608 (9th Cir. 1982) (affirming dismissal of

EEOC’s action and awarding attorneys’ fees to defendant where EEOC acted

unreasonably failing to engage in conciliation and filing suit). See also Byrne v.

Nezhat, 261 F.3d 1075, 1106 (11th Cir. 2001) (“The key to unlocking a court’s

inherent power [to award sanctions] is a finding of bad faith”) (citing Barnes v.

Dalton, 158 F.3d 1212, 1214 (11th Cir. 1998)).

II.

3
The chronology of events in this case lend themselves to the interpretation that the
Commission’s haste may have been motivated, at least in part, by the fact that conciliation,
unlike litigation, is not in the public domain. 42 U.S.C. § 2000e-5(b) (“Nothing said or done
during and as a part of such [conciliation] may be made public by the Commission, its officers or
employees, or used as evidence in a subsequent proceeding without the written consent of the
persons concerned”). We note that the record reveals that the EEOC office in Miami, which is
prosecuting this case, has apparently already made public by way of comments to the New York
Times that this case involves the allegation of a noose incident. The article, which appeared in
that paper on July 10, 2000, inaccurately suggests that an Asplundh employee placed a noose
around the Lewis’ neck.

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 For the foregoing reasons, we conclude that the Commission failed to make

a bona fide effort to conciliate this case in a reasonable and responsive manner and

that the remedy of dismissal and the award of attorneys’ fees by the district court

was not an abuse of discretion. The judgments of the district court are

AFFIRMED.

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