## In the



# U n ited S ta tes Co urt o f Ap p ea ls

F o rth eS e v e n th C ir cu it
N o. 08

- 2483 E QUA L E MPLO YMENT O PP O RTUN ITY C OM MI S S I ON, Plai nt i f f

-Appe l l ant, v. W ATK INS M O TO R L INE S, I NC ., D efend a nt-A pp ellee
.

A pp eal from the United S t ates Di strictC our tfo r the NorthernDi stricto f Illino is, Eas tern Div isi on. No . 07 C4115

—Rebec ca R. Pal lmey er, Ju dge .
A RG UE D J AN UA RY 8, 2009

— D ECI DE D J AN UA RY 23, 2009

Befo re E A S T E RB R OO K, Chie f Judg e, a nd E VANSa nd T INDER, C ircu it Judges . E A S T E RB R OO K, C hi e

f Judg e . I n J une 2004, afterexper i enci ng thr ee ep i sodes ofem plo yee - on- em plo yee m urder orat tem pted m urder, W atk i ns M oto r Lines deci ded that i t w oul d no l onge r hi re anyo ne w ho had b een convi cted ofa vi ol ent c ri m e. Three m onths l ate r W atk i ns r ej ecte d Lyn d on Jac kso n’s appli cati on be cause ofhi s cr i m i nal r ec o r d. H e fi l ed a co m pl aint wi th th e Equa l Em p loy m en t2 N o. 08

- 2483 O p p or tu n ity C om m iss ion, w h ich op en ed an inv e st igat i on t o deter m i ne wh etherthe pol i cy had a d isp ar ate i m pact o n m i nor i ty appli cants

— and, i f so, wh etheri t was “j o b r el at ed f o r the po si ti o n[ s] i n que st i o n a nd c o ns i st en t w ith bu siness nec essity”. 42 U
. S. C
. §2000 e–2(k )( 1 )( A )( i)
. W atk i ns di d not co oper ate i n the i nvest i gat i on, and on A pri l 8, 20 05, the E E OCis s u e d a sub p oen a seeking inform ati on that i t thought per ti nent t o these subj ects
. Almos t f o ury ea r s ha ve g o ne b y . J ac kson a nd W at k i ns re ached a set tl em ent in J anuary20 06. W atk i ns i n sist ed that the s ett l em ent b e co nti ngent on the E E OC ’ s ab an do nm ent o fi ts i nvest i gat i on. J acks on t ol d the E E OC th at he was wi th dr awi nghi s ch ar g e o fdi sc r i m i na ti o n. Butthe E E OC ’ s r e g u l a t i o n s g i v e i td i s c r e t i o n wh e th e r t o a l l o w a charg e t o be withd ra w n, a n d it deci ded to pre ss ahead w i th an i nvest i gat i on that c ove rs per sons i n additi on t o J ac k s o n. In S e pt e mbe r 2 0 0 6 Wat k i ns Mo t o r Line s s o l d i ts op er at in g ass et s to Fe d E x . B u t it re m ain s p ot en tia lly l i ab l e t o J a c k s o n a nd a nys i mi l a r l y s i t ua t e d a pp l i c a nt s, so the pr oce edi ng i s no t m oo t. T h e dist ri ct c ourtdi d not a ct o n the subpoena until M ar ch 200 8, wh en i t di sm i sse d fo r l ack ofsub j ect-m att er j uri sdic ti on the E E OC ’ s m oti on ( fi l ed i n J uly20 07) to enf or ce th e s u b p oe n a. Se e 2 0 0 8 U .S. D ist . L EXIS25 17 0, 10 3 F air Em pl. Pra c. Cas. 15 23 ( N
. D. I l l
. M ar . 26 , 20 08)
. J acks on w o ul d b e b e s ts e r v e d, the j ud g e tho ught, b y the s e t t l em en t, a nd s i nc e th ats ettlem enti s co nt i ng en t o n wi th

d ra w al of t h e c h ar ge th e a ge n c y s h ou ld h av e allow ed h im to w ith d ra w it. B ec au se th e a ge n c y’s co n tr ar y d ec i s ion is arbi tr ary, th e j ud ge w ro te, i t i s a s i fno charg e had be enN o. 08

- 2483 3 fi l ed

— and, i fno one m ake s a val i d c harg e, the E E OCi s no t enti tl ed to i nvest i gat e. S ee EE O C v
. S he l l Oi l Co
. , 466 U
. S. 54 (1984). A l though the j ud ge thought that l ack of a pendingchar ge depri ves the c ourto fsubj ect- m att erj uri sdic tion , that concl usi on i s untenab l e. S eve ra l st atute s s up plyj uri sdic

ti on. T w o provi si ons ofTi tl e VI Ii tse l fautho ri ze dist ri ct cour ts to adj ud i cate s ub po e na- enf or cem ent a cti ons fi l ed by the E E OC . 42 U .S .C . §§ 2 00 0e –5 (f), -8(c ). Th en th er e is 28 U
. S. C. §134 5, wh i ch cr eat es su bj ect- m att erj uri sdic

ti on fo r any s uitfi l ed by the Unite d Sta tes o r one ofi ts age nci es. A dist ri ct cour t’ s be l i efthatthe E E OCsho uld not have i nvestiga te d or sued does not detra ct fro m the f act th at itd id as k the co urt to enf or ce i ts subpoena. A st atute au th or ize s t h e c ou rtto ad j u d ica te th i s req u es t. T h at ’s a ll subj ect- m att erj uri sdic ti on e ntai l s. The dis tr i ct j ud ge m ay have been m i sl ed by the s tat em en t in Shel l O il thata val i d charg e is e sse nti alto j uri sdict i on. The J usti ces appear t o have m eant the E E OC ’s j u ris d icti on, notthe cour t’ s. M or e i m port antl y, Shel l O il uses the word “j uri sdic ti on” as a s ynonym f orany m andato ry ru le. 46 6 U .S. a t 6 5. It is im p or ta n t n otto co n fu se th is com m on u sag e, wh i ch i l l ustr ate s the pro posi ti on that “j uri sdic ti on i s a word ofm any, to o m any, m eani ngs”, Steel Co. v. Ci t ize ns f

orBe t t e rEnvi r onment, 5 23 U
. S. 83, 90 (1998), w i th a rul e that t he co urt l acks subj ect- m att erj uri sdic

tio n . To sa y t h at su bj ec t-m at te r j u ris d ict ion is m i s s i n g is not onl y t o re quir e the j ud i ci ar y t o ra i se the s u b j ect on i t s o wn

— th ou g h no one thinks that the cou rt m us t d eterm i ne the “ va l i di ty ” of a ch ar g e i n e ve r y c as e, e ve n i fthe4 N o. 08

- 2483 par ti es do no t r ai se the i ss ue

—buta l so t o im pl y tha t th e d ispu te belongs i n som e othe r tribu na l. Th e N ort he rn Di st r i cto fI l l i no i s i s th e r i g htt r ibun al, thi s i s th e r i g ht ti m e, a nd the se a r e th e r i g htl iti gan ts, t o r es o l ve the q u es tio n w h et h er Jac ks on ’s req u es t to w ith d ra w h is c h a r g e e n d s the E E OC ’ s a uthor i ty to i nvest i gat e the novi ol ent- fel ony rul e a t W atk i ns M oto r Lines
. Recent d eci si ons ofthe Suprem e Cour t di stingui sh betw een genu in e l im its on j urisd iction and m an d atory c as e-p ro c es sin g ru les . See , e.g., E berha rt v. U nited Sta tes , 546 U
. S. 12 (2005); Kont r i ckv. Ryan , 5 40 U. S
. 44 3 ( 20 04 )
. The ben efi ts of case-p r o c e ssing ru les m ay be w aived or forfei ted. The Courthas dist i nguish ed j uri sdic ti onal fro m oth er req u ire m en ts atlea st tw ice for T itle V II in p ar tic u lar . In A rba ug h v . Y& HC o rp . , 54 6 U. S
. 50 0 ( 20 06 ) , the C ou rth eld th at th e s ta tu to ry d efin itio n of an “e m p loy er ,” w hi c h l i m i ts the Act’ s co ver age to busi nesse s that hav e at least 15 em p loyees, d oes not curt aila district cou rt’s su bj ect-m atter j urisd iction. C loser to th e m ark, th e C o u rt h eld inZipe s v. Tr ans Wor l d Ai r l i ne s , Inc . , 4 55 U
. S. 38 5 ( 1982 ) , thata cour t has subj ect- m att erj uri sdic ti on e ven wh e n a c h a r g e o fd i s c r i mi n a t i o n i s u n t i mel y . A n e mplo yee ’ s d ela y in fi l i ng a charg e g i ves the e m plo yeran affi rm ati ve defe nse, Z ipes he l d ; it do es no t affec t th e cour t’ s j uri sdic ti on . Justso with a ti m el y c harg e that a n e mpl o y e e l a t e r t r i e s t o wi th d r a w. S h el l O il doe s not ove rru le Z ipes ; i t doe s no t e ven ci te Z ipes
. Shel l O il j ust use d th e w ord “j urisd iction” loosel y. A nd becau se th e C ou rt fou n d th e c h ar ge in Sh el l O il to be va lid , i t d id n oth old anythi ngabo ut the conse quences o fan i nval i d charg e for a fede r alc o ur t’ s j ur i sdi ct i o n.N o. 08

- 2483 5 The di st r i ctc o ur t th us ha d s ubj ec t- m at te r j ur i sdi ct i o n. St ill, Shel l O il sa ys that the E E OCm ay us e com p ulsory proce ss to acqu ire i nfo rm ati on o nl y i fso m eone has fi l ed a va l i d c ha r g e o fdi sc r i m i na ti o n. Shel l O il a lso shows that th e va l i di tyo fthe c ha r g e m ayb e d etermi ne d i n the subpoena- en f or cem ent pr oce edi ng; the i ssue need not awai t a l at ers ubs ta nt i ve s ui t bythe a g en cyo r the charg i ng par ty. W atk i ns co ntends thatJ acks on’ s r equest to w i thdraw his cha rg e shoul d have be en gr anted. Yet w ithdrawing a char ge does not m ean that a val i d charg e was ne ve r fi l ed. W at k i ns d oes no t co nt en d, a nd the dist ri ct c ourtdi d not fi nd , thatJ acks on’ s c h ar ge w as in va lid w h en filed . A llShel l O il requi re s is a val i d charg e. Once one h as b een fi l ed, the E E OCr a th e r th a n th e e mp loyee det erm ines h ow the inve stigation p roceed s. C f. D o e v. O berw eis D a iry, 4 5 6 F .3d 704 (7th C ir. 2006) (a charg i ng par ty’ s f ai l ure to coo perat e with the E E OC ’s invest igation do es not block that i nv estigation or a suit). W hat the di str i ct j ud ge sai d i s that a char ge sought to be withd ra w n to f aci l i tat e a se ttl em ent s hou ld be tr eat ed j ust a s i fno charg e eve r had been fi l ed. That s tr i pe ofl ega l fi cti on has a hi sto ry to w hi ch W atk i ns does not ad ver t. Con si dera c l as s ac ti o n fi l ed i n feder alc o ur t. La te r the defen dan t se tt l es wi ththe r epr es en tat i ve pl aint i ff, who pr o poses to di smi ss hi s co m pl aint, o r pa y s o ffthe pl ainti ff’ s cl ai m an d m ake s i t m oo t. Does that m andate di sm iss al “ as if th e s u it h ad n ev er be en filed ? ” N otatall. The s u i t a ffe c t s l e g a l r i g h t s o f p e r s o n s o th e r th an t he in itia l p l a i n tiff, an d so m e o th er m em b er of th e c las s is enti tl ed to i nter vene to c ar ry on w i th the l i ti gat i on. S ee D epo sit G ua ran ty Na tio na l B a nkv. R o per, 445 U
. S. 326 (1980);6 N o. 08

- 2483 U nite d State s P aroleCo m m is si on v. G eragh ty, 4 45 U .S
. 38 8 (1980). Or suppose pla i nti ffand defendant r each a se ttl em ent that i s co ntin ge n t o n vaca tur ofal l j ud i ci al deci si ons m ade so f ar, i n or der t o re l i eve t h e parti es of an y p r e c l u s i v e o r p r e c e d e n t i a l e ffe c t s th a tth e d e c i s i o ns car ry . If “ it i s a s i fthe sui t had neve r been fi l ed, ” then va ca tu r woul d be au to m at i c. B utU
. S. Banc orp M or tgage C o. v. B onner M all P artne rs hip , 5 1 3 U. S
. 1 8 ( 1 9 94) , h o l ds th at settlem en ts, far f r o m l ead ing to aut om atic vaca tu r, cannot dispos e o fpre cedents. A j ud ge i s no t bound by th e par ti es ’ c ho i ce bu t m aye xe r ci se di sc r et i o n a nd u su ally s h ou ld e x er c ise t h at d isc re tio n ag ain st va c at u r, in or der t o prese rv e the deci si ons’ value f oro therl i ti gants
. The ar gum ent that W atk i ns M oto r Lines advances

— that w i thdrawing the charg e and c l osing th e inve sti gat i on wi l l f ac i l i ta te s et tl ement

— i s ex ac tly the s o r t o fa r g um en t m ad e a n d rejec te d inR o per, Geraghty, a nd U .S. B a nc o rp M or tgage . T h e p r o b l e m wi th t h e a r g u me n ti s t h a ti ta l l o ws li tigant s to ach ieve th eir settlem en t by inj uring other, unrepre sente d persons. M any a defendant w oul d l ove to decapit ate a cl ass afterthe s ta tu te ofl i m i tat i ons has r un b y pa y i ngoffthe s o l e r epr es en ta ti ve pl aint i ff, a nd th u s a v o i d i n gp o t e n t i a l l i ab i l i t y t o a l l o t he r c l a s s me mber s. R o pera nd Geraghtycurt ai l thatprac ti ce. That i s what W at k i ns t r i ed to d o he r e bymakingi ts s et tl ementc o nti ngent on the withdrawal o fJ acks on’ s char ge, after the t i m e t o fi l e a new charge had expir ed. Fo r the E E OC had com m enced a pattern -or - pract i ce invest i gat i on that m i ght l ead to r el i eff orm an y p er sons i n additi on t oN o. 08

- 2483 7 J acks on. The ag ency and the j ud i ci ar y a re noto bl i ged to abetthi s s tr ate gy by prefer ring J acks on’ s in ter est s ove r thos e o f o th er w or ker s. J acks on a nd W atk i ns M oto r Lines ar e fre e t o re sol ve thei r ow n d isp ute but m ay not c o m p ro m ise th e in te re st s o f oth er em p loy ee s a n d ap p licants i n the proce ss. The E E OC ’ s r egul ati on say s that “ [ a] char ge fi l ed by oro n be ha l fo fa pe r so n c l ai m i ngt o b e aggri ev ed m ayb e wi th

dr awn o nl y b y the pe r so n c l ai m i ngt o b e ag g r ieved a nd o nl y wi ththe c o ns en t o fthe Com m issi o n . . . wher e th e w i thdrawal ofthe charg e wil l notdefea t th e pu rpos es ofti tl e VI I ”. 29 C. F. R. §1 601. 10. T h e a gencydoes not com m i t a l ega l er ro r, oractarbi tr ar i l y, byco ncl ud i ng tha t i t wi l l “ defea t th e pur po se s o ft i tl e VI I ” f o r the s ettl ement of a single ap p lic an t’s clai m to w ipe ou t a pa ttern -orpract i ce invest i gat i on. The ag ency i s e nti tl ed to vind i cate the inter est s o fal l em plo yee s a nd appli cants. D ec isions such a s EEO C v. Waf f l eHous e, Inc . , 5 34 U.S. 27 9 (20 02) , sho w thatthe age ncy’ s powers ar e ind ep e n d e n to fa n y r e s o l u t i o n b e t we e n e mp l o y e r a n d e mp loy ee . ( Wa

ffle Ho use ho l ds th at th e ag en cymay co nt i nue i ts i nv es ti g at i o n e ve n i fa n a rbi tr at o r ha s r es ol ve d the d i s p u t e b e t we e n a p a r t i c u l a r e mp l o y e e an d th e e mplo yer . ) A s w e pu t i t in E E O C v. Si dl ey Aus t i n L LP , 43 7 F
. 3d 69 5, 6 96 ( 7th Ci r . 2 00 6) : “ The r ea son th er e was no b ar [in Wa

ffl e Ho use ] was not that the a rbi tr ati on cl ause w as unenfo rce abl e but thatthe Com m i ssi on was not bound by i t be cause i ts en for cem ent a uthor i ty i s no t d er i v a tiv e o f th e le ga l righ ts of in d ivid u als ev en w h en it is s e e k i n g to m ak e t h em w h ole .” If arb itr at ion or, in8 N o. 08

- 2483 Sidley Au st in , a giv en em p loy ee ’s fa ilu re to ex h au st h is re m edi es, does notf or ecl ose i nd ependent i nvest igati on by the E E OC, n e i th e r d o e s a s e t t l e me n tin w h i c h th e e mplo yeri nsi sts thatthe em plo yee withdraw his char ge. To s um up: A va l i d c ha rge w as fi l ed, a nd i t g av e th e E E OC the pow er to i nvest i gat e. A cour t can’ t rewri te h ist or y b y s ay in g t h a t o n e t h in g (a w ith d ra w n ch ar ge ) is “as if” a n o t h er (no cha rge ever fi led). N ote, how ever, th at tw o can play th e “as if” gam e: T he Com m issi on’s d e c isio n n otto allow a p riv at e c h ar ge to be w ith d ra w n is

“ a s i f ” a Co mm i s s i o ne r h a d fi l e d a c ha r g e . S e e 4 2 U. S
. C. § 2 0 0 0 e – 5 ( b ) ( e i th e r a p e r s o n a g g r i e v e d o r a C o mm i ssi onerm ay fi l e a char ge)
. True, a no- w i th d ra w al deci si on does notpro du ce a pi ece ofpaper capti oned

“ c h a r g e o fd i s c r i mi n a t i o n ” a n d s i g n e d b y a C o mmi s s i o n e r, b u tth i s i s a n “ a s i f ” e xe r c i s e , a ft e r a l l
. We k n o w fr o m Fe de r al Expr e s s Corp. v. Hol owecki, 12 8 S
. Ct. 11 47 ( 2008 ) , thata docum ent m ay be a “char ge” ev en i fi t l acks an appropr i ate c ap ti on a nd char gi ng l anguage . A pi ece ofpaper that al l eges di scr i m i nati on a nd as ks the a gency to tak e r em edi alact i on s uffi ces. J acks on’ s ini ti alchar ge did that, and w hen the E E OCr efused to al low Ja c ks on t o w i thdraw the cha rg e i t s ubsti tuted i tse l ff orJ acks on a s th e p ro p on en t. T re at in g a n o-w ith d ra w al d ec i sio n as if it w er e a Com m i ssi oner ’ s charg e i s especi al l y ap p ro pri ate w hen i t would be to o l ate fo r a Com m i ssi onerto m ake a f o r m alc ha r g e. ( S cut tl i ng the e xi st i ngi nv es ti g at i o n, whi l e m ak i ngi t i m po ss ibl e to s ta r t a ne w on e g i ve n the tim e l i m i t in §2 00 0e –5 (e), ap p ea rs to be W at kin s’s goa l. T h at w ou ld lea ve all ot h er ap p lica n ts in t h e lu rc h .)N o. 08

- 2483 9 W at k i ns ha s no t as k ed us t o a ffi r m the j udg m en t o n the g r o un d tha t the s ub po e na i s ne e dl e s s l y b ur de ns o m e o r othe rwis e inapp ro pri ate
. A l though we ( l i ke the di str i ct j ud ge) questi on wh etherthe E E OC is acting prudentl y b y devoting t im e of b oth i ts sta ffand W atk i ns to sho rt
l ived pra ct i ce s bya n e nt i tytha t i s no l o ng era n o per at i ng com pany, and w hose r ule m ay w el l be a m plysupporte d by “busi ness necess i ty” gi ven i ts hi sto ryo fworkpl ace vi ol ence, the Ex ec u tive Branch r atherthan the J ud i ci al Branch i s e nti tl ed to deci de w here inves ti gat i ve re sour ces sh o ul d b e devoted
. A cha r g i ngpa r ty ’ s ch an g e o fmin d does not dim i ni sh t h e a gency ’ s a uthor i ty to i nvest i gat e on its ow n be h a l f . Th e jud gm en t o f th e d ist ric t c ou rtis re versed, and the case i s r em anded with instr ucti ons to enf or ce the subpoena.

1- 23- 09