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When Corporate Counsel first wrote about Roger Reeves’ age discrimination suit against Sanderson Plumbing, Inc., we called it “The Most Important Employment Case You Haven’t Heard Of.” Now news of this suit from Mississippi has been everywhere; the U.S. Supreme Court issued a unanimous decision for the plaintiff in June. But its impact has only begun to be felt throughout the business world. And management lawyers are still shaking their heads over Reeves v. Sanderson Plumbing, calling it a lost opportunity — a case with bad facts that didn’t have to yield bad law. In a resounding defeat for Corporate America, the high court first found that employees do not need explicit evidence of discrimination to get to trial and to win; they need only provide enough grounds for a jury to infer that discrimination occurred. On top of that, the Court stressed the sanctity of jury verdicts and the limited right of courts to reverse them. This defeat has prompted some serious Monday morning quarterbacking — with the Washington, D.C., legal elite complaining that Sanderson Plumbing’s outside general counsel made a fatal mistake in largely resisting outside help. From his office in Columbus, Miss., Taylor Smith, a partner in Mitchell, McNutt, Threadgill, Smith & Sams, dismisses these gripes, saying, “I did what was best for my client.” The upshot, however, is that companies everywhere will likely suffer. Gone now is the “pretext plus” rule that had been adopted by the U.S. Courts of Appeal for the First, Second, Fourth, and Fifth Circuits. Discrimination claims in these circuit courts often were dismissed on summary judgment because plaintiffs could not satisfy the pretext-plus requirement that they provide — in addition to a prima facie case and evidence that the employer’s explanation was a pretext — additional evidence that the true motive was discrimination. The Supreme Court, in a decision written by Justice Sandra Day O’Connor, found that because discrimination is often subtle and difficult to prove, plaintiffs don’t need a smoking gun to win. However, Samuel Estreicher, director of the Center for Labor and Employment Law at New York University School of Law, says the Court did leave open a narrow exception for those cases in which it would be unreasonable to infer discrimination simply from the finding of pretext. Still, he says, the overall message is clear: “Most of these issues are for the jury.” The result, laments Smith, is that “it’s going to open the door to more frivolous lawsuits.” Frivolous or not, it certainly will lead to more trials. And “I think the system is healthier for it,” says Paul Mollica, a plaintiffs lawyer with Meites, Mulder, Burger & Mollica in Chicago, who wrote the amicus brief for the National Employment Lawyers Association, an organization of plaintiffs employment lawyers. “I would certainly rank it among the most important employment cases in the last five years.” Sanderson’s impact, though, should be felt beyond the employment law arena. Defense lawyers have long argued that appellate courts should reexamine absolutely all the evidence that was put before a jury. Meanwhile, some plaintiffs’ lawyers have urged courts to consider only the evidence favorable to the winning side. Jim Waide, plaintiff Roger Reeves’ lawyer, had argued vigorously that the Seventh Amendment forbids appellate review of a jury’s factual findings. Justice O’Connor chose the middle ground: “Athough the Court should review the record as a whole, it must disregard all evidence favorable to the moving party that the jury is not required to believe.” Waide is generally pleased: “The spirit of it is to let the jury decide the facts without all the legal mumbo- jumbo.” But defense lawyers also take some comfort. While the high court urged appellate judges to show restraint, the justices refused to strip their brethren of the right to reexamine the trial record. The bottom line, though, is that the defense bar has lost one of the most significant employment cases to come before the U.S. Supreme Court in years. No wonder, then, that there is some resentment toward Smith, who has represented Sanderson for 36 years and never before argued in front of the high court. Numerous Washington, D.C.-based defense lawyers wanted to help him, offering to write his brief to the high court or conduct the oral argument. Smith says that he shrugged off most of the “entreaties and requests” and kept tight reins on the case because “I had tried the case and lived with it from day one. I felt that I was as competent as anybody else.” In contrast, although Waide is from the tiny Tupelo, Miss., firm of Waide, Chandler & Fleitas, this was his second argument before the Supreme Court, and he had the assistance of two veteran plaintiffs’ lawyers and Supreme Court litigators: Eric Schnapper, a University of Washington law professor and expert on employment law who’s worked on about 80 cases that have reached the high court, and Alan Morrison of Washington’s Public Citizen Litigation Group, who’s argued about 16 cases before the court and contributed to briefs for more than 100. In oral argument, Waide combined a cogent recitation of the law and facts with some genuine down-home Southern charm, calling the female justices “Ma’am,” and adopting a self-effacing manner that observers say seemed to disarm the staid court, accustomed to a certain smugness from some of Washington’s top litigators. “I’m not smart enough to figure all this,” Waide said at one point during oral argument. But, Waide added, professor Charles Alan Wright, coauthor of the famous law treatise on civil procedure, “to me has got the sensible test.” Waide’s argument on that point — that the appellate court reviewing a jury verdict should ignore disputed evidence favoring the losing side — surprisingly was not contested by Sanderson’s counsel at oral argument. The court adopted it wholesale, complete with a citation to Wright & Miller’s civil procedure treatise. In fairness to Smith, even the most sophisticated Supreme Court litigator would have had to deal with a fact pattern that made observers cringe. At 57, Reeves was fired after 40 years of working his way up to a supervisor’s position. Although the director who recommended his dismissal said Reeves was let go for doing a bad job, Reeves offered significant evidence to the contrary. A panel for the Fifth Circuit, which reversed the jury’s verdict in Reeves’ favor, noted that there was plenty of evidence contradicting the company’s claim. Reeves also testified that the person responsible for his discharge had made several age-based comments, including telling Reeves that he was “too damn old to do the job.” Ann Reesman, counsel for the Equal Employment Advisory Council, an employer’s organization that submitted an amicus brief in support of Sanderson, notes that “it’s hard to hear words like ‘You’re so old you must have come over on the Mayflower’ in an age discrimination case. You know, you have to wonder, maybe there’s some ‘there’ there.” Some defense lawyers would have liked to see Smith put more emphasis on the legal issues and their expansive ramifications, and less focus on the less than favorable facts. “This was a great opportunity to consider an important legal issue, and the argument ended up being bound up in very specific facts,” says Marshall Babson of Cleveland-based Jones, Day, Reavis & Pogue, who represented the Chamber of Commerce in an amicus brief supporting Sanderson. Indeed, although oral argument touched on the law, there was much back and forth between Smith and the justices on particular points of evidence. “It’s hard to fault the plaintiff in this case for insisting on the facts,” says Babson. “The question is whether or not everybody else should have gotten sucked into that, and they did. The general view was that it was a lost opportunity.” Public Citizen’s Morrison, who contributed to the plaintiffs’ brief, agrees. “I saw his oral argument, and it’s not an argument that I think experienced Supreme Court practitioners would have made.” Smith’s mistake, say critics, was to try to reargue the facts after the jury had spoken. “This is obviously a very smart man,” Morrison says of Smith. “He just wasn’t tuned into the right channel.” Smith disagrees. “If I had to do it again tomorrow I think I’d make the identical argument,” he says. Of course, second-guessing goes on all the time in D.C. And anytime a case travels from a small town outside the Beltway to the vaulted chambers of the Supreme Court, seasoned Washington litigators pounce. “There’s a whole cottage industry of Supreme Court lawyers that become vultures when cert is granted,” says Charles Rothfeld of the D.C. office of Mayer, Brown & Platt. Whatever the grumbling in the Beltway or within companies across the country, Reeves, who couldn’t afford to travel to Washington to hear the oral argument, is thrilled with his victory, and not only for the $98,000 judgment. “I’m proud of it because there’s a lot of people discriminated against,” says Reeves, who now works at a bottling plant in Columbus, Miss. “A lot of people just let things go. They don’t fight it. But that’s what courts are for.”
Using ADR to Resolve Employment Disputes, August 22 – September 6

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