PUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

EQUAL EMPLOYMENT OPPORTUNITY 

COMMISSION,

Plaintiff-Appellant,  No. 04-2058

v.

NAVY FEDERAL CREDIT UNION,

Defendant-Appellee. 

Appeal from the United States District Court

for the Eastern District of Virginia, at Alexandria.

Gerald Bruce Lee, District Judge.

(CA-03-543-1)

Argued: March 17, 2005

Decided: September 13, 2005

Before KING and GREGORY, Circuit Judges, and

HAMILTON, Senior Circuit Judge.

Vacated and remanded by published opinion. Judge King wrote the

opinion, in which Judge Gregory and Senior Judge Hamilton joined.

COUNSEL

ARGUED: Susan Lisabeth Starr, UNITED STATES EQUAL

EMPLOYMENT OPPORTUNITY COMMISSION, Appellate Services, Washington, D.C., for Appellant. Francis Joseph Nealon, BALLARD, SPAHR, ANDREWS & INGERSOLL, Washington, D.C., for

Appellee. ON BRIEF: Eric S. Dreiband, General Counsel, Lorraine
C. Davis, Acting Associate General Counsel, Vincent J. Blackwood,

Assistant General Counsel, UNITED STATES EQUAL EMPLOYMENT OPPORTUNITY COMMISSION, Washington, D.C., for

Appellant. Jeffrey W. Larroca, Kirsten E. Keating, BALLARD,

SPAHR, ANDREWS & INGERSOLL, Washington, D.C., for Appellee. 

OPINION

KING, Circuit Judge: 

The Equal Employment Opportunity Commission (the "EEOC")

appeals from the district court’s judgment in favor of Navy Federal

Credit Union ("Navy Federal") on the EEOC’s Title VII retaliation

claim concerning Donna Santos, a former Navy Federal supervisor.

In its complaint in the Eastern District of Virginia (the "Complaint"),

the EEOC alleged that Navy Federal had illegally discharged Santos

for opposing what she reasonably believed to be the unlawful treatment of one of her subordinates, Tammy Simms. Following extensive

discovery proceedings, the district court awarded summary judgment

to Navy Federal, concluding that the EEOC’s evidence of retaliation

was insufficient and that its claim was also barred by laches. See

EEOC v. Navy Fed. Credit Union, No. CA-03-543-1 (E.D. Va. June

18, 2004) (the "Opinion"). As explained below, we vacate and

remand.

I.

A.

Navy Federal, a credit union serving employees of the Department

of the Navy and their families, is headquartered in Vienna, Virginia.1

1Because this appeal is from an award of summary judgment to Navy

Federal, we are obliged to present and assess the relevant facts in the

light most favorable to the EEOC, the non-moving party. See Seabulk

Offshore, Ltd. v. Am. Home Assurance Co., 377 F.3d 408, 418 (4th Cir.

2004). However, because it is relevant to our analysis under the McDonnell Douglas burden-shifting framework, see Part IV.A, we also set forth

evidence regarding Ms. Santos’s supervisory skills that is favorable to

Navy Federal. 

2 EEOC v. NAVY FEDERAL CREDIT UNION
In April 1995, Donna Santos began working as a supervisor in Navy

Federal’s Staffing Section, a position entailing her oversight of four

subordinates.2 During her three-month probationary period, Santos

received positive performance appraisals, and, in January 1996, she

was recognized in an internally circulated e-mail message for "a wonderful idea to help us enhance software support." J.A. 40.3

In March 1996, however, representatives of Navy Federal’s

Employee Relations Section received complaints from three of Santos’s subordinates about her performance, including that she was

incompetent and error-prone, and that there was a lack of communication, training, and leadership in the Staffing Section. These three

employees (including Tammy Simms) also complained that Santos

had failed to intervene in issues involving Dianne Snably (the fourth

Santos subordinate), and that Santos and Snably seemed to have

"teamed" against them. J.A. 77-81. They reported their complaints to

the Employee Relations Section on March 7, 14, and 15, 1996. 

Notwithstanding these complaints, Santos, on March 24, 1996,

received a merit salary increase, and, on April 9, 1996, she received

an annual performance appraisal rating her as "highly successful" or

"successful" in all scored categories.4 In this appraisal, Santos was

complimented for, inter alia, "learning to address and resolve con2According to the EEOC, Santos is now known as "Moira Flanagan."

However, we refer to her as "Donna Santos," or simply "Santos," as did

the district court. 

3Citations to "J.A. ___" refer to the contents of the Joint Appendix

filed by the parties in this proceeding. 

4The April 9, 1996 performance appraisal of Santos reflects that it was

prepared on March 14, 1996. In this appraisal, Santos was scored in the

following categories: job knowledge; productivity; accuracy; dependability on the job; work methods; problem solving; interpersonal skills; communication skills; work habits; attendance; leadership; organizing and

planning; controlling operations; employee relations; employee recognition and development; and evaluating subordinates. The highest possible

rating in all of these categories (except attendance) was "outstanding,"

followed by "highly successful," "successful," "needs improvement," and

"unsuccessful." For attendance, the highest available rating was "successful." 

EEOC v. NAVY FEDERAL CREDIT UNION 3
flicts among the staff immediately instead of allowing them to fester";

being "intricately involved in motivating the staff"; "delegat[ing]

effectively and assign[ing] the workflow so that deadlines and objectives are met"; "deal[ing] equitably with the group"; and "continu[ing]

to improve her organizational and planning skills." J.A. 57. It was

also recognized that "[t]he Staffing Section continues to improve their

team work under [Santos’s] direction." Id.

After April 1996, assessments of Santos’s performance became

less laudatory. On July 29, 1996, Santos’s immediate supervisor, Jan

Herman, met with Santos to discuss three specific issues — failure to

post a job vacancy announcement, telephone usage, and coverage of

the Staffing Section during lunch. J.A. 86. Then, on August 23, 1996,

Herman documented Santos’s performance for the month, observing

that she needed improvement in the areas of leadership and controlling operations. In support of this assessment, Herman noted the following: Santos was absent from work on the day her Section

distributed an important booklet, leaving no one to address problems

relating thereto; she attended a computer software class when her Section was already short-staffed; on two occasions, significant mistakes

were found in paperwork that had been approved by a subordinate to

whom Santos had delegated that responsibility; on three occasions,

Staffing Section employees were observed being idle; and some of

Santos’s subordinates were regularly five to ten minutes late to work

in the morning, took overly long breaks and lunches, closed their

work stations early, and made excessive personal phone calls. Herman concluded that Santos "needs to pay attention to her staff, what

is getting done, and ensuring that the [Staffing] Section is running

smoothly and according to policy at all times." J.A. 87. Herman also

remarked that Santos "is more interested in her own training and

development in PC applications than in her job as [a Navy Federal]

supervisor." Id. At the time of these observations, Herman considered

conducting a "special review" of Santos (which presumably would

have involved a more formal performance appraisal and constituted

a more grievous mark on Santos’s employment record). By early September 1996, however, Herman had decided against such a review,

because Santos had improved her job performance. J.A. 96.

B.

In 1995, Tammy Simms was promoted by Navy Federal to a position in the Staffing Section, which placed her under Santos’s supervi4 EEOC v. NAVY FEDERAL CREDIT UNION
sion. Over time, Santos criticized Simms’s performance in various

respects, but complimented it in others. Simms perceived Santos’s

criticism of her as unfair and complained that Santos overburdened

her with an inequitable workload. Other Staffing Section employees,

however, believed that Santos sometimes gave special treatment to

Simms by, among other things, excusing Simms from physical tasks

because of a difficult pregnancy, and adjusting her work schedule to

accommodate transportation-related limitations. 

Simms was one of the three Santos subordinates who complained

in March 1996 about Santos’s lack of effective leadership, including

her failure to rein in their co-worker Snably. The record reveals that

Snably was at times uncivil — and worse — to all of her co-workers,

but perhaps especially to those who were African-American women,

including Simms and Barbara Stephens.5 Simms reported to Santos on

March 12, 1996, and then to the Employee Relations Section on

March 14, 1996, that she believed Snably was hiding her paperwork

"to set her up" and had done the same to Stephens. J.A. 79, 500-01.

Although Santos expressed her dissatisfaction with Snably to Simms,

Simms concluded that Santos was an ineffective supervisor and was

thereafter unwilling to go to Santos about problems with Snably.

Simms also came to suspect that Santos and others were prejudiced

against Simms. 

In late August through early September 1996, a series of meetings

were held among, in various configurations, Simms, Santos, Snably,

Herman, and representatives of the Employee Relations Section. During these meetings, the participants discussed both positive and negative aspects of Simms’s performance, her ongoing complaints about

Santos and Snably, and Simms’s concerns about possible racial discrimination against her and Stephens. These meetings failed to

resolve the tensions in the Staffing Section or convince Simms that

she was being treated fairly.

5Prior to March 1996, Stephens had accused, among others, Santos and

Snably (who are white) of racial discrimination. By March 1996, Stephens had been discharged by Navy Federal, and her allegations are not

directly at issue in this proceeding. However, Stephens’s experiences

with Snably contributed to Simms’s later suspicions that she, too, was

the target of racial discrimination in the workplace. 

EEOC v. NAVY FEDERAL CREDIT UNION 5
C.

On September 16, 1996, Simms filed an internal "Request for Resolution Form," with the Employment Relations Section. In it she

alleged race, color, sex, and age discrimination, and detailed numerous instances of alleged unfair treatment by Santos, Snably, and others. J.A. 499-510. Shortly thereafter, according to Santos and the

EEOC, Navy Federal devised a plan to terminate Simms in retaliation

for her discrimination complaint, and to cover up its reasons for the

discharge in order to protect itself from liability in subsequent litigation. The EEOC maintains that Santos opposed this retaliation scheme

— a position that resulted in her suspension and, ultimately, her discharge from Navy Federal. 

By the time Simms lodged her internal complaint, Herman had

considered conducting a "special review" of Santos, but decided

against it in view of Santos’s improved performance. Between the

time that Simms filed her complaint and the time that Santos learned

of Navy Federal’s retaliation scheme, aspects of Santos’s performance were assessed on two occasions. On September 19, 1996, Herman observed a problem with Santos and Simms taking a lunch break

at the same time, prompting her to warn Santos not to make it a continuing practice. On a more positive note, Personnel Director Ellen

Yarborough sent a handwritten note to Santos on October 4, 1996,

thanking her for her "hard work in developing a new application for

the annual financial plan [and] for completing all the personnel budget requirements." J.A. 41. Yarborough remarked: "We appreciate

your dedication to getting it done. Great job!" Id. Santos asserts that

she received Yarborough’s note, along with a cash bonus, as part of

the "Directors award" given to one employee annually in the Human

Resources Division for outstanding contributions to the Division. J.A.

122. 

According to Santos, she shortly thereafter learned of Navy Federal’s scheme to retaliate against Simms. The scheme was two-fold: (1)

to give Simms favorable performance evaluations, which could be

used to defend Navy Federal’s actions in subsequent litigation; and

(2) to heighten scrutiny of Simms’s activity in order to discover an

objective and seemingly legitimate basis for her termination. 

6 EEOC v. NAVY FEDERAL CREDIT UNION
On October 9, 1996, a meeting was held with Santos, Herman, and

two representatives of the Employee Relations Section, including the

head of that Section, Angela Culbertson. Culbertson was angry about

Simms’s allegations of discrimination and declared that she would

"get Tammy [Simms] on principle." J.A. 118. Culbertson instructed

Santos to heighten surveillance of Simms’s work habits, including

compiling accuracy reports and documenting the quantity of work

that Simms produced. J.A. 216. Santos knew that the oversight

responsibilities would fall primarily to Snably, the subject of many of

Simms’s complaints. She objected to the plan because she felt that it

would be unfair to Simms. J.A. 118. Santos proposed that she oversee

Simms’s work instead, but Culbertson rejected her plan. J.A. 121. 

Shortly thereafter Santos participated in a conference call between

Culbertson and Navy Federal’s outside counsel. While discussing

Simms’s discrimination complaint, the attorney for Navy Federal suggested that Culbertson "just fire the bitch." J.A. 118. The attorney also

warned Culbertson that any negative evaluations of Simms’s performance could be perceived as retaliatory. J.A. 120. Santos was then

asked whether Simms was likely to file a retaliation claim if she was

terminated. When Santos responded affirmatively, she was asked to

leave the meeting. Santos later learned that Culbertson had decided

to give Simms favorable performance assessments while efforts were

made to discover an objective basis for terminating Simms, such as

payroll fraud. J.A. 216. 

The week before October 25, 1996, Santos was determined to be

"well qualified" for a promotion in the Human Resources Division.

J.A. 118. Nevertheless, on October 25, Santos received a "special

review," which covered the period from May 15, 1996, to October 15,

1996. This review downgraded Santos’s performance appraisal in

numerous areas relating to her supervisory and management duties.

J.A. 60-66.6 In conjunction with the review, Santos was placed on

6

In her "special review" of October 25, 1996, Santos was scored as

"needs improvement" in various areas in which she had scored "successful" or "highly successful" in her performance assessment of April 9,

1996, including interpersonal skills, communication skills, leadership,

controlling operations, and evaluating subordinates. In the "special

review," Santos was also chastised for, among other things, failing to

"maintain[ ] control of the section," taking "a ‘hands off’ approach to

supervising her employees," and failing "to communicate decisions

clearly and positively." 

EEOC v. NAVY FEDERAL CREDIT UNION 7
probation for 180 days, through approximately April 25, 1997. She

retained her usual supervisory responsibilities during that period.

In November 1996, Santos prepared several proposed evaluations

of Simms’s performance, all of which concluded that Simms’s performance needed improvement. Culbertson rejected each of these assessments because they were too negative, and she eventually took it upon

herself to prepare a substantially more positive evaluation that rated

Simms "successful" or "highly successful" in all scored categories.

J.A. 121, 495-98. When asked by Herman to sign Culertson’s evaluation of Simms, Santos refused to do so, being unwilling to endorse an

evaluation she believed to be fabricated. Herman strongly urged Santos to sign the evaluation and warned her that if she failed to do so

her "probationary period would not go well for [her]" and that she

was "doing [herself] in." J.A. 121. Santos nevertheless refused to sign

the evaluation, prompting Herman to endorse it instead. 

On January 4, 1997, Herman called Santos into her office and

advised her to begin looking for a different job. Although Navy Federal’s usual "special review" policy was to place the targeted individual on probation for 180 days and offer suggestions for improvement

during that period, Herman advised Santos that there was "nothing

[she was] going to be able to do to change things." J.A. 117. On February 6, 1997, Herman prepared a "special review" of Santos for the

period from October 15, 1996 to February 6, 1997, further downgrading her scores and recommending termination for an "inability to

improve performance of supervisory responsibilities to a successful

level." J.A. 71. On February 14, 1997, Santos was terminated.

II.

On March 25, 1997, Simms resigned from Navy Federal and filed

a discrimination complaint against it in the Fairfax County Human

Rights Commission (the "FCHRC"). Two days later, on March 27,

1997, Simms’s complaint was cross-filed with the EEOC, pursuant to

a worksharing agreement between the FCHRC and the EEOC (the

"Worksharing Agreement"). On May 15, 1997, Navy Federal initially

responded to Simms’s complaint in the FCHRC. In its response and

subsequent correspondence, Navy Federal disputed Simms’s charge

of discrimination on several grounds, including that she had received

8 EEOC v. NAVY FEDERAL CREDIT UNION
a "successful" performance appraisal from Herman in January 1997.

The FCHRC actively investigated Simms’s charge until October 28,

1997, when Navy Federal declined to make a settlement offer to

Simms. Thereafter, the FCHRC investigator assigned to the Simms

case essentially ignored it while dealing with personal issues, only

corresponding with Navy Federal in March 1999 with requests to

interview several of its employees. Finally, the FCHRC assigned a

new investigator to the Simms case in the fall of 2000. 

On February 6, 2001, the FCHRC issued a ruling on Simms’s discrimination complaint, finding sufficient evidence of retaliation, but

insufficient evidence of race or national origin discrimination. Subsequently, on March 1, 2001, the FCHRC referred the Simms case to

the EEOC to ascertain whether it wished to issue a cause finding, noting that the FCHRC had lost jurisdiction, as of March 24, 1999, to

conduct a public hearing on Simms’s complaint. Four months later,

on July 6, 2001, the EEOC issued its own determination, agreeing

with the FCHRC’s conclusions and additionally finding reasonable

cause to believe that "Simms’s supervisor" (later identified as Santos)

was the victim of retaliation.7

Settlement negotiations then commenced between the EEOC (acting on behalf of Simms and Santos) and Navy Federal. Eventually,

Simms requested a right-to-sue letter so that she could pursue a federal court action on her own.8

 Meanwhile, settlement negotiations

7Santos has never filed an administrative charge of discrimination

against Navy Federal. In denying Navy Federal’s initial motion for summary judgment, however, the district court concluded that the EEOC’s

investigation of retaliation against Santos fell within the reasonable

scope of its investigation into the allegations made by Simms. EEOC v.

Navy Fed. Credit Union, No. 03-543, at 5-7 (E.D. Va. July 11, 2003).

That ruling is not contested in this appeal. 

8On June 24, 2002, Simms sued Navy Federal in the Eastern District

of Virginia, asserting claims of racial discrimination and retaliation. The

district court entered judgment in favor of Navy Federal on Simms’s discrimination claim, but denied Navy Federal’s motion for summary judgment on the claim of retaliation. Simms v. Navy Fed. Credit Union, No.

02-0900-A (E.D. Va. Aug. 27, 2002). The parties thereafter settled the

matter. 

EEOC v. NAVY FEDERAL CREDIT UNION 9
continued between the EEOC (now acting on behalf of Santos only)

and Navy Federal. The last of those negotiations occurred between

September and November of 2002. Finally, on April 28, 2003, the

EEOC initiated this proceeding on Santos’s behalf in the Eastern District of Virginia. In its Complaint, the EEOC alleged that Navy Federal had retaliated against Santos in contravention of section 704(a)

of Title VII, 42 U.S.C. § 2000e-3(a). 

On June 13, 2003, Navy Federal sought summary judgment on

laches grounds, which the court denied on July 11, 2003. On December 5, 2003, following discovery, Navy Federal renewed its motion,

asserting the following: (1) that EEOC’s evidence of retaliation was

insufficient; and (2) that the EEOC’s claim was barred by laches. By

its Opinion of June 18, 2004, the district court granted summary judgment to Navy Federal both on the merits and on the grounds that

laches barred the EEOC’s claim. Opinion at 2. The EEOC has filed

a timely notice of appeal, and we possess jurisdiction pursuant to 28

U.S.C. § 1291.

III.

We review de novo an award of summary judgment, viewing the

facts and inferences drawn therefrom in the light most favorable to

the non-moving party. See Seabulk Offshore, Ltd. v. Am. Home Assurance Co., 377 F.3d 408, 418 (4th Cir. 2004). Such an award "is appropriate only ‘if the pleadings, depositions, answers to interrogatories,

and admissions on file, together with the affidavits, . . . show that

there is no genuine issue of material fact and that the moving party

is entitled to a judgment as a matter of law.’" Id. (quoting Fed. R. Civ.

P. 56(c)) (alteration in original). 

Because the equitable balancing required in a laches determination

is committed to the discretion of the district court, we may reverse

such a ruling only if such discretion was abused. See White v. Daniel,

909 F.2d 99, 102 (4th Cir. 1990). By definition, a court "abuses its

discretion when it makes an error of law." United States v. Ebersole,

411 F.3d 517, 526-27 (4th Cir. 2005) (internal quotation marks omitted).

10 EEOC v. NAVY FEDERAL CREDIT UNION
IV.

By this appeal the EEOC makes two contentions: (1) that the district court erred in ruling that the EEOC failed to present sufficient

evidence of retaliation; and (2) that the court abused its discretion in

ruling that laches barred the EEOC’s claim on behalf of Santos. We

assess each of these contentions in turn.

A.

In assessing the EEOC’s retaliation claims, we are obliged to begin

with the language of the relevant statutory provisions. In pertinent

part, section 704(a) of Title VII prohibits an employer from taking an

adverse employment action against any employee "because he has

opposed any practice made an unlawful employment practice under

this subchapter." Title VII § 704(a), 42 U.S.C. § 2000e-3(a). Under

the burden-shifting framework first formulated by the Supreme Court

in McDonnell Douglas Corp. v. Green, 411 U.S. 792 (1973), a plaintiff bears the initial burden of establishing a prima facie case of retaliation. See Laughlin v. Metro. Wash. Airports Auth., 149 F.3d 253, 258

(4th Cir. 1998) (citing McDonnell Douglas, 411 U.S. at 802-04).

Once this burden is carried, the burden shifts to the defendant, who

is obliged to articulate a legitimate, non-retaliatory justification for

the adverse employment action. See id. If the defendant carries this

burden, the onus is on the plaintiff to then demonstrate that the nonretaliatory reason advanced by the defendant is a mere pretext. See

id.; see also Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S.

133, 143 (2000). 

By its Opinion, the district court concluded that the EEOC had

failed to establish a prima facie case of retaliation against Navy Federal, and that the EEOC had failed to demonstrate that the nonretaliatory reason advanced by Navy Federal was a pretext. Opinion

at 7-10. As explained below, we are unable to agree with these conclusions.

1.

In order to establish a prima facie case of retaliation, a plaintiff

must prove three elements: (1) that she engaged in a protected activEEOC v. NAVY FEDERAL CREDIT UNION 11
ity; (2) that her employer took an adverse employment action against

her; and (3) that there was a causal link between the two events. See

Von Gunten v. Maryland, 243 F.3d 858, 863 (4th Cir. 2001) (citing

Beall v. Abbott Labs., 130 F.3d 614, 619 (4th Cir. 1997)). Only the

first element of this test is at issue here. The district court concluded

that the EEOC had failed to establish that Santos had engaged in a

protected activity. The court reached this result for two reasons: (a)

because Santos had not "opposed" any action taken by Navy Federal;

and (b) because Santos had no reasonable basis for believing that any

action taken by Navy Federal was unlawful. Opinion at 6-9.

a.

Under the applicable legal principles, in the context of a retaliation

claim, a "protected activity" may fall into two categories, opposition

and participation. Only one of these categories — opposition — is relevant here. See Laughlin, 149 F.3d at 259 (citing 42 U.S.C. § 2000e3(a)). As we have recognized, protected oppositional activities may

include "staging informal protests and voicing one’s own opinions in

order to bring attention to an employer’s discriminatory activities,"

id., as well as "complain[ts] . . . about suspected violations," Bryant

v. Aiken Reg’l Med. Ctrs., Inc., 333 F.3d 536, 543-44 (4th Cir. 2003).

In concluding that Santos did not oppose any of Navy Federal’s

actions toward Simms, the district court emphasized that Santos was

one of the primary objects of Simms’s internal discrimination complaint. Opinion at 7. But the unlawful activity that Santos claims to

have opposed was not the discrimination alleged by Simms, but rather

Navy Federal’s acts of retaliation against Simms for complaining of

discrimination. According to Santos, Navy Federal intended to terminate Simms in retaliation for her allegations of discrimination, and to

cover up its improper reasons for her termination with ostensibly

objective grounds. The evidence reveals that Santos opposed this

scheme. Specifically, when Culbertson gave primary supervisory

authority over Simms to Snably, Santos objected, believing the transfer of authority from her to Snably to be a component of Navy Federal’s improper retaliatory scheme. More importantly, when Santos was

asked to sign what she believed to be a misleading but favorable evaluation of Simms’s work, Santos refused to do so because of her

understanding that Navy Federal intended to use the evaluation to

12 EEOC v. NAVY FEDERAL CREDIT UNION
defend itself from future litigation by Simms.9

 This evidence, showing that Santos objected to Snably’s supervision of Simms and that

she refused to approve the misleading evaluation of Simms’s performance, precluded a ruling in favor of Navy Federal on the question

of opposition.

b.

The district court further concluded, however, that even if Santos

had opposed actions taken by Navy Federal, she could not have reasonably believed that those actions were in violation of Title VII.

Opinion at 7. We have recognized that section 704(a) protects activity

in opposition not only to employment actions actually unlawful under

Title VII but also employment actions an employee reasonably

believes to be unlawful. See United States ex rel. Wilson v. Graham

County Soil & Water Conservation Dist., 367 F.3d 245, 255 (4th Cir.

2004), vacated on other grounds, 125 S. Ct. 2444 (2005); see also

Nealon v. Stone, 958 F.2d 584, 590 (4th Cir. 1992). In its ruling, the

district court reasoned that the increased surveillance and scrutiny of

Simms’s work habits were merely "administrative actions" that could

not reasonably be adverse employment actions. Opinion at 8. It further held that Santos could not reasonably have believed that Navy

Federal’s efforts to evaluate Simms more favorably than she deserved

were adverse to Simms because favorable treatment is "[b]y definition" not adverse. Id.

Unfortunately, the district court’s analysis on this point took too

narrow a view of Navy Federal’s actions relating to Simms. Assessing

the evidence of Navy Federal’s actions towards Simms as a whole,

Santos held a reasonable belief that Navy Federal was unlawfully

retaliating against Simms. The series of relevant events, recounted by

Santos in her testimony before the FCHRC and in her deposition here,

shows that her superiors at Navy Federal set in motion a plan to terminate Simms in retaliation for her complaints of racial discrimination, while at the same time seeking to conceal their improper motives

under the guise of objective criteria. 

9

Indeed, when Simms first filed her complaint against Navy Federal in

the FCHRC, the misleading evaluation that Culbertson prepared and that

Santos refused to sign figured prominently in Navy Federal’s defense. 

EEOC v. NAVY FEDERAL CREDIT UNION 13
Shortly after Simms filed her discrimination complaint, Santos

attended a meeting where Culbertson became angry and asserted that

she would "get Tammy [Simms] on principle." Shortly thereafter Santos participated in the conference call where Navy Federal’s lawyer

suggested that they "just fire the bitch." During this conference call,

the attorney also advised Culbertson that any unfavorable evaluations

of Simms’s performance could potentially support a retaliation claim

by Simms. Culbertson and others at Navy Federal then developed a

plan under which Simms would receive favorable evaluations while

her actions were scrutinized to discover an objective basis for her discharge, such as payroll fraud, which would insulate Navy Federal

from civil liability. Navy Federal was not, in this context, doing

Simms a favor by positively assessing her job performance. The

heightened scrutiny and favorable evaluations were thus part and parcel of its larger plan to fire Simms for unlawful reasons and to cover

up those reasons with pretextual charges. When Santos objected to the

added surveillance and refused to sign the misleading evaluation of

Simms, she therefore reasonably believed that she was opposing

unlawful retaliation. In these circumstances, the EEOC has presented

evidence sufficient to establish a prima facie case of unlawful retaliation against Santos.

2.

As explained above, when a plaintiff has established a prima facie

case of retaliation, the burden shifts to the defendant to articulate a

legitimate, non-retaliatory reason for the adverse employment action.

See Reeves, 530 U.S. at 143; Laughlin, 149 F.3d at 258 (citing

McDonnell Douglas, 411 U.S. at 802-04). If the defendant carries this

burden, the presumption of retaliation falls, and the plaintiff bears the

ultimate burden of proving that the defendant’s non-retaliatory reason

for the adverse employment action was pretextual. See id.10

In ruling in favor of Navy Federal on the pretext issue, the district

court concluded that the EEOC had "presented no evidence to directly

10Navy Federal sustained its burden of articulating a legitimate, nonretaliatory reason for its adverse employment action against Santos by

presenting evidence that it had terminated her because she lacked supervisory skills. 

14 EEOC v. NAVY FEDERAL CREDIT UNION
rebut Defendant’s evidence that Santos’s supervisory skills were deficient." Opinion at 10. Navy Federal did present evidence that, despite

Santos’s technical skills, she was not considered a capable supervisor.

During March 1996, three of Santos’s subordinates complained of

problems within Santos’s Section. Indeed, one complained that there

was a lack of communication, training, and leadership in the Staffing

Section. Another complained that she was receiving inadequate training and that Santos had lost control of her Section. In July 1996, Herman, Santos’s supervisor, met with her to discuss various

performance issues, and in August 1996, Herman documented that

Santos needed improvement in the areas of leadership and controlling

operations. 

The summary judgment record, however, also contains evidence

demonstrating that Santos’s supervisors were pleased with her overall

job performance and that her opposition to the plan to terminate

Simms was the actual basis for her discharge. In April 1996, shortly

after her subordinates complained of her incompetence and lack of

supervisory skills, Santos received a positive annual performance

appraisal, which praised, inter alia, her achievements in resolving

interpersonal conflicts in her Section, motivating her staff, and "deal-

[ing] equitably with the group." Although by September 1996 Herman had registered complaints about certain aspects of Santos’s

performance, Herman decided against a "special review" because she

believed that Santos’s performance had improved. Furthermore, in

October 1996, Navy Federal presented Santos with the Human

Resources Division’s "Directors award," an annual honor accompanied by a cash bonus, and given in recognition of outstanding contributions to the Division.11 Finally, even after Santos opposed Navy

Federal’s retaliation scheme against Simms, Santos was deemed "well

qualified" for a promotion.

Not only is the evidence in conflict regarding Santos’s job performance, but the EEOC also presented evidence from which a jury

11Navy Federal contests the evidence of the "Director’s award," asserting that Santos received only a handwritten note of thanks for certain

technical work she had performed. In the posture of this appeal, however,

we are obliged to accept the facts in the light most favorable to the

EEOC. 

EEOC v. NAVY FEDERAL CREDIT UNION 15
could readily infer that the actual reason for her discharge by Navy

Federal was her opposition to its treatment of Simms.12 The record

reveals that, just after Santos expressed opposition to Navy Federal’s

scheme to retaliate against Simms, Santos was given a "special

review," which was significantly harsher than her previous evaluation

of April 9, 1996. At the same time, Santos was also placed on probation. In regard to the misleading Simms evaluation, Culbertson

repeatedly rejected as overly negative Santos’s efforts to fairly assess

Simms’s performance before completing the Simms evaluation herself. Santos’s refusal to approve Culbertson’s misleading evaluation

of Simms was met sternly by Herman, who warned Santos that she

was "doing herself in." Shortly thereafter, Herman advised Santos that

she should be searching for new employment. When Santos asked

what steps she could take to avoid termination, Herman responded

that there was nothing she could do, despite the fact that Navy Federal’s general probation policy was to offer suggestions for improvement to probationary employees such as Santos. Whatever Santos’s

skills as a supervisor, the evidence, viewed in the proper light, warrants the inference that Santos was fired because of her opposition to

what she reasonably perceived to be a concerted effort by Navy Federal to terminate Simms for unlawful reasons.13 As a result, the district

12We observe that this evidence (that Santos was actually fired for

opposing the retaliation scheme against Simms) best supports Santos’s

claim of pretext. To overcome the burden of proving that the reason for

termination advanced by Navy Federal was a pretext, Santos was not

necessarily required to prove that she was a good supervisor. She needed

only to prove that her lack of skill as a supervisor was not the cause of

her termination. See Price v. Thompson, 380 F.3d 209, 212 (4th Cir.

2004) ("[T]he plaintiff can prove pretext by showing that the [defendant’s] explanation is unworthy of credence or by offering other forms

of circumstantial evidence sufficiently probative of [retaliation].") (internal quotation marks omitted). 

13Indeed, it appears that Santos’s belief that Navy Federal was retaliating against Simms was not only reasonable but correct as well. The evidence of Navy Federal’s scheme clearly warrants the conclusion that

Navy Federal was retaliating against Simms. Cf. LaFond v. Gen. Physics

Serv. Corp., 50 F.3d 165, 175-76 (2d Cir. 1995) (reversing summary

judgment in favor of defendant-employer where plaintiff-employee presented evidence that defendant’s "stated reason for discharging him was

16 EEOC v. NAVY FEDERAL CREDIT UNION
court’s ruling in favor of Navy Federal on the pretext issue was erroneous.

B.

As an alternative ground for its summary judgment award to Navy

Federal, the district court concluded that the doctrine of laches bars

the EEOC’s claim. In so ruling, it based its decision wholly on the

delay by the FCHRC while the matter was pending in Fairfax County.

Opinion at 11-12. Under our precedent, the equitable defense of

laches requires a defendant to prove "(1) lack of diligence by the

party against whom the defense is asserted, and (2) prejudice to the

party asserting the defense." White v. Daniel, 909 F.2d 99, 102 (4th

Cir. 1990) (internal quotation marks omitted). The first element of

laches, lack of diligence, is satisfied where a plaintiff has unreasonably delayed in pursuing his claim. See id. On this point, the court

observed that, because the FCHRC had proceeded so slowly, the

EEOC "was unable to adopt the FCHRC’s findings and move forward

until July 2001," over four years after Simms filed her initial complaint. Opinion at 12. The "unreasonable delay" identified by the

court was the failure of the FCHRC to timely investigate Simms’s

claim. The court thus attributed to the EEOC the delay caused by the

FCHRC in concluding that laches bars the claim asserted in the

EEOC’s Complaint.14 As explained below, the court erred in imputing

the actions of the FCHRC to the EEOC. 

a pretext concealing a retaliatory motive"). Indeed, after Simms filed her

complaint with the FCHRC, both the FCHRC and the EEOC concluded

that Simms’s retaliation complaint had merit. And, when Simms pursued

her claims against Navy Federal in federal court, the district court denied

summary judgment to Navy Federal on Simms’s retaliation claim. Simms

v. Navy Fed. Credit Union, No. 02-0900-A (E.D. Va. Aug. 27, 2002). 

14Although the district court, by its Opinion of June 18, 2004, granted

judgment in favor of Navy Federal on the laches issue, it had rejected a

laches claim of Navy Federal’s in its earlier ruling of July 11, 2003.

EEOC v. Navy Fed. Credit Union, No. 03-543, at 8 (E.D. Va. July 11,

2003) ("[I]t does not appear that the claim was neglected or abandoned

by the [FCHRC] or that their efforts were dilatory or the result of unreasonable procrastination."). In fairness to the district court, its second ruling was made after discovery revealed more details concerning the

FCHRC’s handling of the Simms matter. 

EEOC v. NAVY FEDERAL CREDIT UNION 17
In support of the district court’s ruling on this issue, Navy Federal

maintains that an agency relationship exists between the EEOC and

the FCHRC. Based on our analysis of the pertinent statutory provisions, however, the two agencies operate with substantial independence. Title VII’s provisions regarding "FEP" or "deferral" agencies

such as the FCHRC,15 including sections 706(c)-(e) and 709(b)-(d).

See 42 U.S.C. §§ 2000e-5(c) to (e), §§ 2000e-8(b) to (d). These provisions are best understood as creating a system of "cooperative federalism," under which, in the interests of comity, the EEOC and state and

local authorities share primary responsibility to enforce the civil

rights laws. See, e.g., Phillip J. Weiser, Towards a Constitutional

Architecture for Cooperative Federalism, 79 N.C. L. Rev. 663, 671

(2001) ("[R]eal authority under [cooperative federalism] regimes

often rests with the states which ultimately exercise considerable discretion in making and implementing policy."). Sections 709(c) and (d)

of Title VII, for example, grant deferral agencies exclusive jurisdiction for at least sixty days to act upon charges arising within their

respective jurisdictions. 42 U.S.C. § 2000e-5(c) to (d). The courts

have interpreted those provisions as being designed to provide the

deferral agencies with the opportunity to resolve discrimination

claims without federal intervention. See EEOC v. Commercial Office

Prods. Co., 486 U.S. 107, 110-11 (1988) (citing both Supreme Court

decisions and Title VII’s legislative history in support of this proposition); Puryear v. County of Roanoke, 214 F.3d 514, 517 (4th Cir.

2000) ("The purpose of the presumptive sixty-day deferral period is

comity — to provide states and localities the first opportunity to combat discrimination, free from premature federal intervention."); se

also Love v. Pullman Co., 404 U.S. 522, 526 (1972)). These understandings rest on the premise that deferral agencies such as the

FCHRC enjoy a substantial degree of autonomy and discretion. 

15A "FEP" (an acronym for "fair employment practices") or "deferral"

agency is a state or local agency that enforces state and local civil rights

laws. See Title VII § 706(c), 42 U.S.C. § 2000e-5(c). The jurisdiction of

such agencies overlaps that of the EEOC. See 29 C.F.R. § 1601.13(a)(3).

In the spirit of limiting federal intrusion on state functions, such an

agency enjoys substantial independence from the EEOC, but only if the

jurisdiction in which the agency is organized has "a fair employment

practice law" that the agency is empowered to enforce. See 29 C.F.R.

§ 1601.70(a). The FCHRC is such a deferral agency. See 29 C.F.R.

§ 1601.80. 

18 EEOC v. NAVY FEDERAL CREDIT UNION
In further support of its contention that the EEOC and the FCHRC

enjoy an agency relationship, Navy Federal relies on section II.A of

the Worksharing Agreement, under which each agency designates the

other as its agent "for the purpose of receiving and drafting charges."

Yet, the Worksharing Agreement, when viewed as a whole, is consistent with our assessment of the statutory framework for the relationship between the EEOC and the FCHRC. The overall thrust of the

Worksharing Agreement, as its title suggests, is to divide the workload on proceedings over which the two agencies possess common

jurisdiction. Section III.A.1 of the Worksharing Agreement lists those

matters that the EEOC is required to initially process, while section

III.A.2 lists those committed to the authority of the FCHRC. The

independence that the two agencies retain to process and investigate

their own charges is made evident by section II.C of the Agreement,

which provides that "[n]ormally, once an Agency begins an investigation, it resolves the charge." Indeed, the designation of each agency

as an agent of the other for the purpose of receiving and drafting

charges is simply a matter of convenience for the charging party.

Under section II.A, the receipt by either agency of a charge automatically initiates the proceeding for the purposes of Title VII’s timing

provisions, and the charges are freely transferred between the two

agencies. The Worksharing Agreement, therefore, does not alter the

fact that the EEOC and the FCHRC operate with substantial independence and autonomy.16

The autonomy enjoyed by the EEOC and the FCHRC controls our

assessment of the laches issue. The doctrine of laches requires that a

party demonstrate a "lack of diligence by the party against whom the

defense is asserted." White, 909 F.2d at 102 (emphasis added) (internal quotation marks omitted). Absent a showing that the delaying

entity is the agent or alter ego of the party against whom laches is

asserted, we are unable to penalize the latter (the EEOC) for the

actions of the former (the FCHRC). By attributing the FCHRC’s

delay to the EEOC for laches purposes, the district court made a legal

16That the EEOC and the FCHRC operate autonomously is further

demonstrated by their handling of the Simms matter. After the FCHRC

referred the case to the EEOC, the EEOC, rather than simply adopting

the FCHRC’s findings, conducted its own investigation of the matter and

decided to pursue a claim on behalf of Santos as well as Simms. 

EEOC v. NAVY FEDERAL CREDIT UNION 19
error, constituting an abuse of discretion. See Ebersole, 411 F.3d at

526-27.17

V.

Pursuant to the foregoing, we vacate the judgment in favor of Navy

Federal and remand for such further proceedings as may be appropriate.

VACATED AND REMANDED

17Because the district court erred in resolving the issue of whether the

EEOC unreasonably delayed, we need not reach the issue of whether

Navy Federal was unduly prejudiced by any delay. 

20 EEOC v. NAVY FEDERAL CREDIT UNION