Equal Employment Opportunity Commission v. Service Temps Inc.
679 F.3d 323
5th Cir.2012Background
- Texas staffing firm Smith refused to let deaf applicant Moncada apply for a stock clerk position; district court found ADA violation and awarded back pay, compensatory and punitive damages, plus injunctive relief.
- Moncada sought sign-language interpreter; Smith employee Ray told her she could not apply due to deafness; Moncada communicated despite past warehouse experience.
- EEOC charged Smith with ADA violation in 2006; Notice of Determination issued 2007; conciliation offers and negotiations followed with mixed results.
- EEOC filed suit Sept 3, 2008; district court handled pleadings, discovery, and conciliation issues; Smith sought leave to amend and argued conciliation was not properly alleged.
- Trial in Sept 2010 resulted in a verdict for the EEOC: back pay $14,400, compensatory $20,000, punitive $150,000; injunctive relief was later issued after remittitur reduction to $68,800.
- Appellate proceedings affirmed district court’s rulings on jurisdiction, pleading requirements, damages handling, punitive damages, and injunctive relief, with two-year reporting obligation from judgment
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the court had subject matter jurisdiction under ADA’s commerce clause | EEOC; Smith challenges whether activity affected interstate commerce | Smith argues commerce element not proven; jurisdiction disputed | District court had jurisdiction; commerce touchpoint satisfied (alternative bases available) |
| Whether failure to conciliate must be pleaded with particularity in the answer | Smith argues 9(c) pleading suffices if supported by summary judgment | EEOC had fulfilled conciliation requirement; policy requires specific denial | District court correctly held lack of specificity in answer forecloses raising conciliation defense |
| Whether denial of leave to amend the answer was proper for lack of good cause | Smith lacked timely discovery and delayed raising conciliation defense | Smith could have amended earlier; delay lacked good cause | denial of leave to amend affirmed; no abuse of discretion |
| Whether punitive damages instructions and evidence supported imposition of punitive damages | Smith contends instruction misdirected on agent’s malice; insufficient evidence of Ray’s malice or managerial scope | Evidence supported agent’s managerial role and scope; instruction correct | Punitive damages upheld; instruction, evidentiary basis, and managerial scope sustained |
| Whether remittitur and injunctive relief were appropriate and properly tailored | Smith argues remittitur excessive; injunctive relief burdensome and improperly framed | Remittitur and injunctive relief appropriate;-kept within discretion | Remittitur proper; injunctive relief affirmed with two-year reporting period; order limited to two years from judgment |
Key Cases Cited
- Agro Distribution, LLC v. Sacco, 555 F.3d 462 (5th Cir. 2009) (conciliation precondition to suit; not jurisdictional but essential)
- Klingler Electric Corp., 636 F.2d 104 (5th Cir. 1981) (denial of performance of conditions precedent may be raised by motion or answer)
- Kolstad v. American Dental Ass'n, 527 U.S. 526 (1999) (supervisory liability and good faith compliance in punitive damages)
- Deffenbaugh-Williams v. Wal-Mart Stores, Inc., 188 F.3d 278 (5th Cir. 1999) (role of managerial agent in punitive damages; good-faith exception)
- Sommers Drug Stores Co. Emp. Profit Sharing Trust v. Corrigan, 883 F.2d 345 (5th Cir. 1989) (trial court discretion in framing jury instructions)
- Jackson v. Seaboard Coast Line R.R. Co., 678 F.2d 992 (11th Cir. 1982) (treatment of specific denials and preconditions in pleadings)