Supreme Court Will Weigh In on Evidence Used to Show Discrimination In Layoff

The United States Supreme Court has agreed on June 11, 2007, to review a federal appeals court decision in Denver requiring trial courts to allow testimony of non-party former employees alleging discrimination by supervisors who played no role in the action challenged by the plaintiff to show that discrimination against older workers pervaded the workplace and to persuade jurors that plaintiff's layoff also was discriminatory. Sprint/United Management Company v. Mendelsohn, No. 06-1221 (cert. granted June 11, 2007). The Supreme Court's acceptance of the case raises employers' hopes that evidence often seen as irrelevant and highly prejudicial to their defense to discrimination claims will be barred conclusively in federal court litigation.

The Tenth Circuit Court of Appeals' 2-1 decision last year (466 F.3d 1223) made it more difficult for employers to exclude testimony of non-party former employees who assert their terminations also resulted from employer bias, despite the lack of any direct connection between those dismissals and the termination of the plaintiff. This evidence, in effect, also forces employers to rebut the allegations of "other" employees by conducting a series of mini-trials within the primary trial, distracting from the real issue of plaintiff's treatment, delaying resolution of the case and increasing litigation cost.

Ellen Mendelsohn and the Sprint/United Management Company's Reduction in Force

Ellen Mendelsohn was a manager in Sprint/United Management Company's Overland Park, Kansas business development and support group operations. She was 51 years old when she was terminated as a part of a company-wide reduction in force ("RIF") that affected nearly 15,000 employees during an 18-month period. Mendelsohn sued Sprint for violation of the Age Discrimination in Employment Act ("ADEA"), alleging her inclusion in the RIF was because of her age. At trial, Mendelsohn sought to present the testimony of five other former Sprint employees over the age of 40 who had also lost their jobs pursuant to the RIF. These former workers also thought they were victims of discrimination. None of these other employees, however, had the same supervisor as Mendelsohn.

Sprint's Motion to Exclude "Me, Too" Evidence and Victory at Trial

Before the start of Mendelsohn's ADEA trial, Sprint moved to bar the testimony of these other former Sprint employees because, among other reasons, none of them had the same supervisor as Mendelsohn. The trial court agreed with Sprint and limited the testimony at trial only to those employees who were "similarly situated" to Mendelsohn. It defined "similarly situated" to include only those employees who had the same supervisor as Mendelsohn and had been terminated in the same period. The jury returned a verdict for Sprint and the district court judge denied Mendelsohn's motion for a new trial.

Tenth Circuit Reversal – Limiting the "Same Supervisor" Rule

Mendelsohn appealed the district court's exclusion of testimony. Sprint argued that the "same supervisor" rule announced in Aramburu v. Boeing Co., 112 F.3d 1398 (10th Cir. 1997), required the district court to limit the testimony of other employees to those who shared Mendelsohn's supervisor.

In a 2-1 decision overruling the district court, the Tenth Circuit held that the "same supervisor" rule applies only to discriminatory disciplinary actions, not to a company-wide RIF. While the Tenth Circuit considered Aramburu's "same supervisor" rule appropriate in the context of discriminatory disciplinary actions because divergent treatment by a single supervisor is relevant to show the discriminatory intent of the supervisor, a company-wide RIF "is not about individual conduct but about a company-wide policy of which all Sprint's supervisors were allegedly aware." In this vein, the Tenth Circuit remarked, "Applying Aramburu's 'same supervisor' rule in the context of an alleged discriminatory company-wide RIF would, in many circumstances, make it exceedingly difficult, if not impossible, for a plaintiff to prove a case of discrimination based on circumstantial evidence."

"Same Supervisor" Rule Should Apply to RIFs, Dissent Says

Dissenting, Judge Tymkovich disagreed with the Court's decision to limit the Aramburu rule to cases involving disciplinary actions, noting in particular that it is "equally plausible that an employer could have a company-wide policy of using disciplinary actions as a pretext for unlawful discrimination." Judge Tymkovich wrote that Aramburu's "same supervisor" rule should apply in RIF cases unless "independent evidence of the enterprise-wide policy" has been adequately developed.

Supreme Court Will Weigh In

The Tenth Circuit's decision with regard to "me, too" evidence conflicts with the decisions of several other circuits. The Second, Third, Fifth and Sixth Circuits have held this evidence is irrelevant and prejudicial, ruling that district courts commit reversible error by admitting such testimony. The Tenth Circuit's controversial ruling prompted large companies across the nation, including AT&T, Honeywell International Inc. and Lockheed Martin Corp., to file an amicus brief asking the Supreme Court to accept certiorari on this watershed issue.

While the case will not be considered until the October 2007 Term, experienced employment lawyers generally believe the Supreme Court will adhere to the "same supervisor" rule followed by the majority of federal appeals courts which have addressed the question and articulated in Judge Tymkovich's dissenting opinion.

Jackson Lewis attorneys will monitor the Supreme Court's progress with regard to the decision and provide updates as soon as new information is available.