United States District Court, Northern District of Illinois, E.D
February 29, 1984
EQUAL EMPLOYMENT OPPORTUNITY COMMISSION, PETITIONER,
APPLETON ELECTRIC COMPANY, RESPONDENT.
The opinion of the court was delivered by: Leighton, District Judge.
This is an application by petitioner Equal Employment
Opportunity Commission ("EEOC") to enforce three administrative
subpoenas against respondent Appleton Electric Company
("Appleton"). Both parties have filed motions for summary
judgment; and additionally, EEOC has moved for a protective
order and sanctions. On consideration of all briefs, memoranda
and oral arguments heard on Friday, December 23, 1983, the
court grants EEOC's motion for summary judgment, denies
respondent's and grants EEOC's motion for a protective order
and sanctions. The material facts are as follows.
On November 20, 1978, EEOC Commissioner Daniel E. Leach issued
a charge against Appleton alleging that it had engaged in
unlawful discrimination against Negroes and women with respect
to recruitment, hiring, job assignment, training and
promotional opportunities. This action was pursuant to Section
706(b) of Title VII, 42 U.S.C. § 2000e-5(b); and on March 4,
1981, the change was amended to allege a continuing violation
from, at least, January 1, 1974 to March 4, 1981. On December
4, 1978, in accordance with standard agency practices, EEOC
served notice on Appleton and proceeded to conduct an
Appleton, however, refused to respond to EEOC's requests for
information, contending that the Commission's investigation was
unlawful because the Office of Federal Contract Compliance had
previously investigated the company. Due to Appleton's
unwillingness to produce requested documents voluntarily, EEOC
served it with an administrative subpoena. On April 15, 1979,
EEOC denied a petition by Appleton contesting issuance of the
Still Appleton refused to comply with the subpoena;
consequently, EEOC commenced an action similar to this
proceeding which was assigned to Judge Shadur of this court.
Relying on the briefs of the parties, and the recommendation of
Magistrate Cooley, Judge Shadur entered an order enforcing the
subpoena. EEOC v. Appleton Electric Company, slip op. No. 79
C2100 (N.D.Ill., Aug. 26, 1980). Appleton's appeal to the
Seventh Circuit was dismissed. (Ex. 2, EEOC's Motion for
Protective Order and Sanctions).
EEOC proceeded with its investigation. Although Appleton
granted the Commission access to some documents and some
employees, the company's cooperation continued to be less than
complete. Eventually, the Commission was forced to issue three
additional subpoenas, CH 83-01, CH 83-02 and CH 83-03 (Ex. 2,
Aff. of Kathleen Blunt), which directed Appleton employees
Carmen McDonald, Ralph Smoot and Ron Richards each to appear
for an additional interview. Even though these three employees
had been interviewed once before, EEOC maintains that it has a
legitimate reason for asking them more questions about
Appleton's employment practices. The evidentiary information
which will be obtained through compliance with these subpoenas,
the Commission argues, is material, relevant, not unduly
burdensome and not repetitive.
Nevertheless, Appleton sought, as before, to have the
Commission revoke the subpoenas, only to have EEOC's District
Director, and later the full Commission, deny its petition. The
Commission again directed Appleton to comply with the subpoena
requests. Appleton refused.
Accordingly, on November 23, 1983, EEOC filed with this court
an application for enforcement of these subpoenas. Appleton has
opposed the Commission's application by raising several
affirmative defenses. On December 23, 1983, this court granted
EEOC's motion for a protective order prohibiting Appleton from
taking the depositions of Commission personnel.
The first issue before this court is whether the subpoenas
issued by EEOC should be enforced. The authority of the
Commission to issue subpoenas in connection with an
investigation is well settled. Section 710 of Title VII,
42 U.S.C. § 2000e-9, provides that
for the purposes of all hearings and investigations conducted
by the Commission or its duly authorized agents or agencies,
Section 11 of the National Labor Relations Act (49 Stat. 455;
29 U.S.C. § 161) shall apply.
Section 11 of the National Labor Relations Act,
29 U.S.C. § 161(2), authorizes the issuance of subpoenas requiring the
production of evidence, and further provides that:
In case of contumacy or refusal to obey a subpoena to any
person, any district court of the United States . . . within
the jurisdiction of which the inquiry is carried on or within
the jurisdiction of which said person guilty of contumacy or
refusal to obey is found or resides or transacts business, upon
application of the Board shall have jurisdiction to issue to
such person an order requiring such person to appear before the
Board, its members, agent or agency there to produce evidence
if so ordered.
The subpoenas giving rise to this enforcement proceeding were
issued pursuant to the guidelines of this statute.
A federal district court will enforce an administrative
subpoena where (1) the underlying investigation is within the
agency's authority, (2) the subpoena is not too indefinite, and
(3) the information requested is reasonably relevant. EEOC v.
A.E. Staley Mfg. Co., 711 F.2d 780, 783 (7th Cir. 1983); EEOC
v. Bay Shipbuilding Corp., 668 F.2d 304, 310 (7th Cir. 1981).
After reviewing the procedural history of this court concludes
that enforceability of the subpoenas issued in this case is
The subpoenas seek to obtain information about Appleton's
employment practices that clearly is relevant to the agency's
discrimination investigation. See EEOC v. K-Mart Corp.,
694 F.2d 1055 (6th Cir. 1982); EEOC v. Bay Shipbuilding Corp.,
668 F.2d 304 (7th Cir. 1981). The fact that the Appleton
employees have previously been questioned is not fatal to the
EEOC's application. Leads uncovered by the Commission in the
course of its investigation have made it necessary that certain
employees of Appleton be questioned further regarding matters
that were not fully delved into at initial interview sessions.
It is apparent that the questioning proposed by petitioner
is neither repetitious nor frivolous.*fn1 Additionally, the
court is completely satisfied from the submissions of the
parties that the Commission is conducting its investigation in
There is, moreover, no basis for Appleton's argument that the
subpoenas are unenforceable because the charge filed by the
Commission fails to satisfy standards of factual specificity
that this court properly should recognize. The Supreme Court
has held "that the EEOC need make no showing of probable cause
to suspect a violation of Title VII unless the employer raises
a substantial question that judicial enforcement of the
administrative subpoena would be abusive use of the court's
process." United States v. Powell, 379 U.S. 48, 51, 85 S.Ct.
248, 251, 13 L.Ed.2d 112 (1964); see also EEOC v. Bay
Shipbuilding, 668 F.2d at 312-313; EEOC v. A.E. Staley Mfg.
Co., 711 F.2d at 783-786; EEOC v. University of New Mexico,
504 F.2d 1296 (10th Cir. 1974); Graniteville Company (Sibley
Division) v. EEOC, 438 F.2d 32 (4th Cir. 1971). The Court of
Appeals for this Circuit has repeatedly recognized that it is
through the investigation process that the Commission
determines whether its discrimination charges have factual
validity. See, e.g., EEOC v. Bay Shipbuilding, 668 F.2d at
312; EEOC v. Staley, 711 F.2d at 783. Issuance of a charge by
the Commission does no more than commence an investigation.
General Employment Enterprises, Inc. v. EEOC, 440 F.2d 783
(7th Cir. 1971); EEOC v. Staley, 711 F.2d at 784.
Accordingly, a charge need not set forth in detail specific
underlying facts. Id. at 783-786. It is sufficient if it
describes generally the allegedly discriminatory practices of
an employer. See id. at 783, n. 2; 29 C.F.R. § 1601.12(b).
In this case, the Commission's charge easily satisfies this
standard by alleging that "since January 1, 1974, respondent
has engaged in unlawful discriminatory employment practices
against blacks and women based on their race and sex with
respect to recruitment, hiring, job assignment, training and
promotional opportunity." (Petitioner's Mem. in Support of
Summary Judgment, p. 6). The charge then proceeds to describe
specific types of discrimination believed to be taking place in
relation to specific job and training classifications. No more
need be stated in the charge. See EEOC v. Staley, 711 F.2d at
782 n. 1 (upholding validity of similar charge). Appleton's
factual specificity argument is even more tenuous because
Magistrate Cooley and Judge Shadur previously upheld the
validity of the charge in the prior subpoena enforcement
proceeding brought by EEOC. See EEOC v. Appleton, slip op.
No. 79 C 2100 (N.D.Ill. Aug. 26, 1980).
However, Appleton, relying on a decision of the Court of
Appeals for the Eighth Circuit, persists in arguing that the
Commission is obligated to set forth specific facts in the
charge. See Shell Oil Co. v. United States EEOC, 676 F.2d 322
(8th Cir. 1982), cert. granted, 459 U.S. 1199, 103 S.Ct.
1181, 75 L.Ed.2d 429. In that case, the court declined to
enforce EEOC's subpoena duces tecum because, in its judgment,
the charge contained insufficient factual allegations. Shell
Oil, supra at 324-26. The court, citing Section 706(b) of
Title VII, 42 U.S.C. § 2000e et seq., imposed a requirement of
factual specificity for administrative discrimination charges
that never before had been recognized. Accordingly, EEOC's
application for enforcement of the subpoena was denied due to
its failure to set out with particularity the date and
circumstances of the employer's alleged discriminatory
The reasoning of the Shell Oil decision is at odds with
decisions of the Supreme Court and Courts of Appeals other than
the Eighth Circuit which have consistently recognized that the
ability of federal agencies to fulfill their duties would be
unjustifiably hampered if they were required to set forth in
detail specific facts justifying an investigation. See, e.g.,
United States v. Powell, 379 U.S. 48, 51, 85 S.Ct. 248, 251,
13 L.Ed.2d 112 (1964); Marshall v. Barlow's Inc.,
436 U.S. 307, 320, 98 S.Ct. 1816, 1824, 56 L.Ed.2d 305 (1978); EEOC v.
Bay Shipbuilding Corp., 668 F.2d at 312-313. EEOC v. K-Mart
Corp., 694 F.2d 1055 (6th Cir. 1982). Consequently, Shell
Oil was pointedly and emphatically rejected by the Court of
Appeals for this Circuit in a recent opinion. EEOC v. Staley,
711 F.2d at 785-787. Furthermore, the fact the Supreme Court
granted certiorari indicates a likelihood, in this court's
estimation, that Shell Oil will be reversed.
Chief Judge Lay's dissenting opinion in the denial of a
petition for rehearing the case accents the shaky ground on
which the opinion stands. See Shell Oil v. EEOC,
676 F.2d 322, reh'g. denied, 689 F.2d 757 (8th Cir. 1982) (Lay, C.J.,
dissenting), cert. granted, 459 U.S. 1199, 103 S.Ct. 1181, 75
L.Ed.2d 429. The dissent notes that the majority opinion
deviates "far beyond any court of appeals in requiring detailed
pleadings to support an administrative subpoena." Shell Oil,
689 F.2d at 757 (Lay, C.J., dissenting). The dissent highlights
the impracticability of requiring EEOC to show reasonable cause
before it can conduct an investigation. The majority's opinion
was characterized as "supported neither by logic nor precedent,
and would severely undermine the Commission's ability to bring
commissioner's charges of discriminatory patterns and practices
as authorized under 42 U.S.C. § 2000e-5." Shell Oil, 689 F.2d
at 759. This court agrees with the wisdom of Chief Judge Lay's
Needless to say, Shell Oil will not be followed by this
court. In this instance, the factual basis of the Commission's
charge, or lack thereof, will be apparent when the
investigation is completed. Thereafter, the charge will either
be substantiated and pursued or unsubstantiated and dismissed.
Until this point, the Commission need not set forth the factual
underpinnings of its discrimination charge.
Appleton's assertion of the defense of laches likewise is
meritless. Contrary to Appleton's claim that the Commission is
responsible for unreasonably prolonging the investigation, the
court finds that delays in the investigation primarily have
been caused by Appleton itself. Throughout the investigation,
respondent has endeavored to thwart or circumvent the
Commission's requests. Any prejudice caused by the
five-year-old investigation is largely a consequence of
Appleton's own intransigence. The defense of laches is
unsubstantiated and, therefore, is rejected.
Appleton's claim of undue burden also is unfounded. It is well
settled that investigations which do not threaten the normal
operation of respondent's business are permissible. Bay
Shipbuilding, supra at 313; F.T.C. v. Rockefeller,
591 F.2d 182, 191 (2d Cir. 1979). Respondent has not shown that the
subpoenas threaten, in any way, Appleton's normal business
operations. Since this case presents none of the exceptional
circumstances which might warrant holding an evidentiary
hearing, petitioner EEOC is entitled to summary enforcement of
its subpoenas. See EEOC v. Staley, 711 F.2d at 788.
This court further finds that the EEOC is entitled to sanctions
in the nature of costs and fees incurred in enforcing the
subpoenas of the three named Appleton employees. It is apparent
that Appleton's conduct throughout this investigation has been
designed to hamper and frustrate the Commission. The delay of
five years is not because the case or investigation is
exceedingly complex, but appears to have occurred chiefly
because of the skill of respondent's attorneys in taking
advantage of every opportunity for delay that they
have managed to create. As petitioner points out:
Appleton has continuously resisted the Commission's
investigation of this charge, starting in 1979 by refusing to
comply with an earlier subpoena petitioning the Local District
Director to revoke their appeal to the full Commission, filing
suit in District Court, appealing Magistrate Cooley's
recommendation, appealing Judge Shadur's adoption of the
Magistrate's Report, and appealing to the Seventh Circuit —
losing on every level, up to the Seventh Circuit's summary
(Petitioner EEOC's Motion for Protective Order and Sanctions,
p. 4) (emphasis in original).
Additionally, Appleton makes unsubstantiated assertions
regarding the burdensome load it is being asked to bear, the
redundancy of the subpoenas, and the lack of relevance of the
material sought to be uncovered. Respondent boldly attempts to
convince this court that it was EEOC which fostered the delays.
The only reasonable conclusion this court can reach is that the
respondent's conduct is dilatory.
Appleton's grounds for resisting the subpoena are baseless. The
failure to allege any substantive defenses which are supported
by facts leads this court to the conclusion that the reason
behind the respondent's various actions was only to delay the
investigation. This court will not countenance the dilatory
behavior evinced by respondent.
In order to promote the efficient administration of justice and
to enable federal agencies to conduct fair and reasonable
investigations, unwarranted, vexatious tactics by a party
cannot be tolerated. Pursuant to the Federal Rules of Civil
Procedure, this court has authority to grant sanctions against
parties and their counsel who use dilatory tactics to
Federal rule 11 states:
The signature of an attorney constitutes a certificate by him
that he has read the pleading; that to the best of his
knowledge, information and belief there is a good ground to
support it; and that it is not intended for delay.
Fed.R.Civ.P. 11 (1983) (emphasis added). Additionally,
28 U.S.C. § 1927 (1983) provides:
Any attorney . . . who so multiplies the proceedings in any
case unreasonably and vexatiously may be required by the court
to satisfy personally the excessive costs, expenses, and
attorneys fees reasonably incurred because of such conduct.
Applying these legal standards to the facts of this case, the
court holds that the conduct of respondent and its counsel
unreasonably and vexatiously delayed the Commission's
investigation. Therefore, all reasonable costs incurred,
including attorney's fees, are hereby granted to petitioner.
Accordingly, for the reasons stated, the court will enter an
order that grants petitioner's motion for summary judgment,
denies respondent's motion for summary judgment, and grants
petitioner's motion for sanctions. Petitioner is invited to
submit for review by the court a properly supported fee
petition which details costs and expenses incurred in
connection with this enforcement proceeding.