Seyfarth Synopsis: Following a jury trial in a federal court in Mississippi in an EEOC-initiated lawsuit alleging that Black adult club dancers were subjected to race discrimination, where their employer was found liable of wrongdoing, the Court granted the EEOC’s motion for injunctive relief, ordering the employer to comply with all seven of the non-monetary terms sought by the EEOC. See EEOC v. Danny’s Restaurant, LLC, No. 3:16-CV-00769, 2021 U.S. Dist. LEXIS 153633 (S.D. Miss. Aug. 16, 2021).
This ruling exemplifies that once a court reaches a finding of liability in an EEOC-initiated lawsuit, the Commission will be emboldened to seek and secure wide-ranging injunctive relief. Likewise, it shows the scope of injunctive relief that courts are apt to enter following a determination of liability.
On September 20, 2016, on behalf of current and former adult club dancers (“Claimants”), the EEOC filed a lawsuit against Danny’s Downtown Cabaret location in Jackson, Mississippi, alleging it discriminated against them on the basis of their race. Id at *2. On October 1, 2018, the Court found Defendant subjected various Claimants to disparate terms and conditions of employment in violation of Title VII of the Civil Rights Act of 1964, as amended. The remaining issue of damages proceeded to a jury trial, which took place from May 6-13, 2019. At trial, the EEOC sought relief for the Claimants’ emotional pain, mental anguish, and lost wages. In addition, the EEOC sought punitive damages for Defendant’s alleged reckless or callous indifference to Claimants’ federally protected rights. The jury returned a verdict as to damages and awarded back pay, compensatory damages, and punitive damages. Thereafter, the EEOC moved for injunctive relief.
The Court’s Decision
The Court granted the EEOC’s motion for injunctive relief. As a preliminary matter, after noting that the EEOC acts in the public interest and seeks remedies to vindicate the underlying policies of Title VII, the Court explained that the issuance of an injunction rests primarily in the informed discretion of a judge. Id. at *3 (citations and quotations omitted). Defendant argued that injunctive relief was not warranted because the EEOC had offered no proof of the “likelihood of future violations” and that the “totality of the circumstances should be considered when evaluating the likelihood of future violations.” Id. at *4 (citations omitted).
After considering the trial evidence, the Court held that Defendant failed to meet its burden that recurring violations were unlikely. The Court noted that after one Claimant filed an EEOC charge, Defendant continued to discriminate against its Black dancers by implementing a Black dancer quota. Id. Managers were informed that when checking in dancers, they needed to include the race of the dancer. Finally, Defendant would limit the number of Black dancers who could work on a shift and inform managers that there were, “too many [B]lack girls,” which would result in Black dancers being sent home. Id. Accordingly, the Court held that the EEOC was entitled to injunctive relief.
The Court granted all seven of the components of injunctive relief sought by the EEOC. First, the Court held that the five-year term of the injunctive relief proposed by the EEOC was appropriate. Id. at *8. Second, the Court held that because Defendant did not object to the appointment of an Injunctive Relief Manager, and had over a year to identify and retain an HR consultant, a time period of 60 days to appoint or retain an Injunctive Relief Manager was reasonable. Third, the Court ordered the Injunctive Relief Manager to review, revise, and post anti-discrimination policies on bulletin boards and locker rooms. Id. at *10-11. Fourth, the Court held that Defendant must provide EEO training for all employees, which is to be completed by the Injunctive Relief Manager or a third-party entity experienced in conducting EEO anti-discrimination trainings. Fifth, the Court held that the injunctive relief is binding on any purchaser of Defendant’s business. Sixth, the Court ordered Defendant to maintain a confidential, toll-free, employee hotline number for reporting concerns about discrimination, harassment or retaliation. Seventh, the Court required: (i) the Injunctive Relief Manager to submit reports to the EEOC relating to Defendant’s compliance with the Court’s Judgment of Injunctive Relief; and (ii) permission for the EEOC to review and/or request information related to compliance. Accordingly, the Court granted the EEOC’s motion to implement all seven facets of injunctive relief.
Takeaways For Employers
The ruling in EEOC v. Danny’s Restaurant, LLC, demonstrates that the Commission will aggressively pursue expansive injunctive relief in the event it obtains a finding of liability from a court or jury. Employers facing motions for injunctive relief brought by the EEOC can expect the Commission to use this ruling and others like it to persuade courts to exercise their authorized discretion in this area. Accordingly, when appropriate, employers would be prudent to negotiate injunctive relief terms as early as possible, so as to avoid potentially onerous court-ordered non-monetary relief.