ROSEMARY M. COLLYER, United States District Judge
This protracted litigation presents two novel legal issues concerning application of the Rehabilitation Act and the Age Discrimination in Employment Act to a federal employer. Over seven years ago, the regional offices of the Rehabilitation Services Administration, a division within the Department of Education, were defunded by the White House budget for fiscal year 2006, which led to office closings and consolidation into the Department's Washington, D.C., headquarters. Disabled and older employees in the regional offices lost their jobs and sued. The subsequent litigation resulted in lengthy discovery, and now, cross-motions for partial summary judgment on Plaintiffs' disparate impact theories of liability. Plaintiffs single out the decision to defund the regional offices, claiming that it constituted age and disability discrimination because of its disparate impact on older and disabled employees. In doing so, Plaintiffs challenge a management decision by officials in the Executive Branch that was designed to achieve a centralized organizational structure, direct supervision, and cost savings, and accordingly is protected by the "business necessity" test. Partial summary
Eighteen current and former employees of the Rehabilitation Services Administration (RSA), a division of the Department of Education's Office of Special Education and Rehabilitative Services (OSERS), filed this suit against Secretary Margaret Spellings in her official capacity.
The Department of Education (Department) is a multilayered agency comprised of several principal offices and nine program offices. OSERS is a program office charged with implementing programs that support individuals with disabilities. OSERS has three components, of which RSA is one. See Def.'s Reply [Dkt. 88], Ex. 22 [Dkt. 89-5] at 1-2.
As its name implies, Congress established RSA to implement statutory provisions relating to individuals with disabilities. Def.'s Mot. Summ. J. [Dkt. 75], Ex. 6 [Dkt. 76-7] at Attach. C. With the stated mission of "provid[ing] leadership and resources to assist state and other agencies in providing vocational rehabilitation ..., independent living ... and other services to individuals with disabilities to maximize their employment, independence, and integration into the community and the competitive labor market," Pls.' Mot. Summ. J. [Dkt. 74-1], Ex. 2 [Dkt. 74-5] at 1, RSA oversees grant programs to state agencies that provide direct vocational rehabilitation services to individuals, id., Ex. 1 [Dkt. 74-4] at 1. Prior to October 1, 2005, RSA maintained ten regional offices. See id., Ex. 6 [Dkt. 74-9]. No other division within OSERS operated regional offices. Def.'s Mot. Summ. J. ¶¶ 24-25. Today, only the Department's Office of the Inspector General, Office of Civil Rights, and Office of Federal Student Aid maintain regional offices. Def.'s Reply ¶ 3.
In February 2005, President George W. Bush released his fiscal year 2006 budget proposal (FY06 budget) for the federal government. With respect to the Department, the FY06 budget reflected a slight decrease in funding for full-time equivalent (FTE) positions. Def.'s Mot. Summ. J., Ex. 1 [Dkt. 76-2] at X-2. The reduction in
Reorganizing RSA by ending funding for regional offices and consolidating them into headquarters was not a novel idea. Regional offices for other programs in the Department had been eliminated in the past, and prior administrations had considered consolidating RSA.
In 2004, the idea picked up steam. Mr. Justesen was then serving as the Deputy Commissioner of RSA and Acting Deputy Assistant Secretary for OSERS. Pls.' Opp'n [Dkt. 82] ¶ 10. He presented the idea to the White House Domestic Policy Council, which included future Secretary Spellings, as a way to achieve efficiency through centralization in accord with how the Bush Administration managed other programs. Id.; Def.'s Mot. Summ. J. ¶ 5; id., Ex. 2 (Dep. of David Dunn, senior education advisor to President Bush) [Dkt. 76-3] at 22, 26-28; id., Ex. 3 (Dep. of Secretary Spellings) [Dkt. 76-4] at 51. At some point, the idea was "vetted by the Secretary's office" and presented to the Office of Management and Budget (OMB) during an October 2004 meeting concerning the Department's preliminary budget for fiscal year 2006. Justesen Dep. at 105-06. At the suggestion of Mr. Jones, who was then serving as the Department's Associate Deputy Secretary for Budget, id. at 108; Pls.' Mot. Summ. J. ¶ 38, Mr. Justesen suggested to OMB that closing RSA regional offices would result in savings that could fund other programmatic initiatives, id., Ex. 28 (Dep. of Carol Cichowski, official with Department's Budget Service) [Dkt. 74-31] at 38-39.
Although the FY06 budget was not set for release until February 2005, OSERS executive leadership learned in late January that some RSA regional offices already had informed their staff of the planned closures, prompting staff members to call human resources offices for information. Id., Ex. 23 [Dkt. 74-26] at 3. As a result, OSERS prepared an email to inform RSA staff of the reorganization before the FY06 budget was released. In a January 29, 2005 email concerning the latest draft of the RSA staff notice, OSERS Executive Officer Andrew Pepin wrote to several OSERS officials, including Assistant Secretary Hager and Mr. Justesen, and asked whether the email notice should mention that the consolidation was part of the FY06 budget. He noted that "[a]t this stage [the budget] is out anyway among many folks and by February 7 everyone will know about it anyway," and suggested that "[t]his has to be introduced ... [as] something the Administration supports for positive reasons which all of you will think up on Monday." Id. at 1. Mr. Justesen responded on the same day, opining: "[W]e should not mention the budget — they don't like us to even mention budget issues before the public date. I think we should treat this as an Administration/Hager action to improve management and not even tie it to the budget in an email." Id. Three days later, on February 1, 2005, the RSA Commissioner sent an email to all RSA staff announcing the consolidation. Id., Ex. 11 [Dkt.74-14] at 1. In her email, the Commissioner stated that the reorganization would streamline resources and ensure uniform implementation of programs, id., and during a subsequent conference call with union officials representing the affected workforce, Assistant Secretary Hager explained the consolidation as "a straight business decision," Def.'s Mot. Summ. J., Ex. 4 [Dk. 76-5] at 10.
Released in February 2005, the FY06 budget provided, as relevant:
Id., Ex. 1 at X-3. Following the release of the FY06 budget, the Department explained the decision to defund RSA regional offices to Congress and RSA staff.
Congress asked Secretary Spellings, who had assumed that office in January 2005, for more information on the reorganization, expressing concern that the office closures would have a deleterious effect on RSA programs. Pls.' Mot. Summ. J, Ex. 38 [Dkt. 74-41] at 1; see also id., Ex. 39 [Dkt. 74-42] at 189; id., Ex. 40 [Dkt. 74-43] at 289. In a letter dated April 8, 2005, Secretary Spellings explained that advancements in electronic communications and data technologies had rendered RSA regional offices an inefficient use of resources. She stated that reorganization also would rectify two issues with the RSA regional offices: (1) difficulties with issuing timely reports on monitoring state agencies; and (2) overstaffing as shown by a workforce analysis, especially in comparison to such programs as the IDEA Special Education Grants to States, 20 U.S.C. § 1411, which had a federal appropriation several times larger than the RSA State Grants program but approximately fifty percent fewer assigned FTE. See id., Ex. 41 [Dkt. 74-44].
OSERS's internal communications regarding the regional office closures paralleled Secretary Spelling's explanation to Congress. Agency emails and memoranda described the consolidation as a "business decision" that was the product of protracted consideration and accorded with the President's management goals for improving the performance of federal agencies. See Def.'s Mot. Summ. J., Ex. 5 [Dkt. 76-6] at 2 (April 1, 2005 email from Assistant Secretary Hager to RSA staff stating that consolidation was "consistent with the President's Management Agenda goals of improving the way government works and generating real results" and had been considered "for several years"); id., Ex. 6 [Dkt. 76-7] at 2 (April 21, 2005 memorandum from Assistant Secretary Hager to the Executive Director of OSERS describing the RSA reorganization as a way "to more effectively serve the Department and align RSA in a manner that will assist [OSERS] in meeting the President's management initiatives and the Secretary's
By the beginning of March 2005, the Department was actively working to implement the FY06 budget's directive. OSERS convened a "Workplace Committee" to analyze the "work in the regions and headquarters to determine how Regional Office functions can best be consolidated into headquarters and how the RSA headquarters staff will be reorganized and re-energized to accomplish these functions." Id., Ex. 74 [Dkt. 74-77] at 1. As Acting Commissioner of RSA, Mr. Justesen started weighing reassignment options. In a March 7 email, he asked Acting RSA Deputy Commissioner Jennifer Sheehy to "find out who exactly directly answers to the commissioner and who answers to the deputy and what [are] their essential (clearly self declared) functions of their jobs" so that he could determine where to locate those functions. Id., Ex. 75 [Dkt. 74-78] at 1. Secretary Spellings requested authority from the Office of Personnel Management (OPM) to offer 85 buyouts and 26 early outs in RSA regional offices and headquarters. Def.'s Mot. Summ. J., Ex. 7 [Dkt. 76-8] at 1; id., Ex. 10 [Dkt. 76-11] at 1. RSA employed 138 people as of April 13, 2005, and the Department calculated that all but twelve RSA employees were eligible for a buyout or early out. Id., Ex. 10 at 1. The Department's Office of Equal Employment Opportunity (EEO) completed an expedited review of the proposed reorganization in which it concurred with the decision but expressed "serious reservations," because "the proposed closure of ... [RSA's] regional offices will have a disproportionate adverse impact on employees with disabilities currently employed at those offices." Pls.' Mot. Summ. J., Ex. 63 [Dkt. 74-66] at 1.
On May 10, 2005, OPM granted authority for voluntary separation incentive payments and voluntary early retirement buyouts
On September 6, 2006, Plaintiffs filed the instant, eight-count Complaint. Long and laborious discovery ensued in which both sides searched warehouses of documents and took numerous depositions covering a multitude of topics. Most relevant to the cross-motions for partial summary judgment were the depositions of Secretary Spellings, Mr. Justesen, and Mr. Dunn. Through these depositions, Plaintiffs sought to establish that (1) the officials had an incomplete understanding of RSA regional offices' responsibilities and (2) the decision to defund RSA regional offices was based on personal belief rather than rational judgment. The record supports the first thesis if Plaintiffs, in their roles as opponents to the Department's motion and not as movants, are given the benefit of some small uncertainty in the record. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986) ("The evidence of the non-movant is to be believed, and all justifiable inferences are to be drawn in his favor."). It does not support the second.
For instance, Plaintiffs pressed Mr. Justesen on whether RSA regional offices conducted annual, on-site reviews of all state vocational rehabilitation agencies. Mr. Justesen unequivocally stated that the regional offices never performed such monitoring. Justesen Dep. at 148-49. Plaintiffs contend that the RSA did monitor all 80 state vocational rehabilitation agencies on an annual basis. Pls.' Mot. Summ. J. at 40. The evidence from which Plaintiffs draw support is not as clear as their argument. See id., Ex. 7 (regional staffing rosters from 2004); id., Ex. 8 [Dkt. 74-11] (job description of program specialist to oversee "two or more" state agencies); Ex. 9 [Dkt. 74-12] (same); Ex. 42 (no mention of number of state agencies subject to annual review); id., Ex. 44 [Dkt. 74-47] (memorandum from RSA regional commissioners to state agency directors on changes to monitoring reviews without stating the number to be conducted).
Asked to recall the rationale for defunding RSA regional offices, each former official testified that the decision was based on
Plaintiffs and the Secretary have moved for partial summary judgment. Both parties ask the Court to determine whether Plaintiffs have claims under the Rehab Act and the ADEA for disparate impact discrimination. Plaintiffs are clear that the only adverse employment action they challenge is the decision to cut funding for RSA regional offices and not any of the later implementation measures or impacts of that decision. Although some of the eight counts alleged in their Complaint ostensibly regard employment actions taken after the decision was made, Plaintiffs now expressly limit those counts insofar as they allege a disparate impact theory of liability. See Compl. ¶¶ 70-77. Plaintiffs insist:
Pls.' Opp'n at 34-35 (internal citations omitted). Each party opposes the other's motion for partial summary judgment. For the reasons discussed below, the Court will deny Plaintiffs' motion and grant the Secretary's motion.
This litigation has been complicated by the difficulties of necessary discovery and disputes therefrom. Despite the passage of time, Plaintiffs have standing because they have articulated an actual, concrete and particularized injury-in-fact that is fairly traceable to the Secretary's challenged action which likely will be redressed by a favorable decision. See
The Court has jurisdiction over the case because it arises under federal law. See 28 U.S.C. § 1331. The Secretary does not dispute that Plaintiffs have exhausted their administrative remedies before the Equal Employment Opportunity Commission (EEOC). See 29 U.S.C. §§ 794, 794a; 42 U.S.C. 2000e-16(c); 29 C.F.R. pt. 1614.
In their respective cross-motions, each party contends that it is entitled to partial summary judgment as a matter of law. Under Rule 56 of the Federal Rules of Civil Procedure, summary judgment shall be granted "if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a); accord Anderson, 477 U.S. at 247, 106 S.Ct. 2505. On summary judgment, the burden on a moving party who does not bear the ultimate burden of proof in the case may be satisfied by making an initial showing that there is an absence of evidence to support the nonmoving party's case. Celotex Corp. v. Catrett, 477 U.S. 317, 325, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). This burden "may be discharged by `showing' — that is, pointing out to the district court — that there is an absence of evidence to support the nonmoving party's case." Id.
The burden then shifts to the nonmovant to demonstrate the existence of a genuine issue of material fact. The nonmovant may not rest on mere allegations or denials, but must instead by affidavit or otherwise, present specific facts showing that there is a genuine issue for trial. See Fed. R. Civ. P. 56(c); Celotex, 477 U.S. at 324, 106 S.Ct. 2548; see also Greene v. Dalton, 164 F.3d 671, 675 (D.C.Cir.1999) (nonmovant must present specific facts that would enable a reasonable jury to find in its favor).
In ruling on a motion for summary judgment, the court must draw all justifiable inferences in the nonmoving party's favor. Anderson, 477 U.S. at 255, 106 S.Ct. 2505. A nonmoving party, however, must establish more than "the mere existence of a
Further, "[w]hen opposing parties tell two different stories, one of which is blatantly contradicted by the record, so that no reasonable jury could believe it, a court should not adopt that version of the facts for purposes of ruling on a motion for summary judgment." Scott v. Harris, 550 U.S. 372, 380, 127 S.Ct. 1769, 167 L.Ed.2d 686 (2007); see Reetz v. Jackson, 176 F.R.D. 412, 414-15 (D.D.C.1997) (a plaintiff cannot create a genuine issue of material fact by contradicting her own deposition testimony).
Section 501 of the Rehab Act provides the exclusive cause of action for a federal employee alleging disability discrimination by a federal agency. 29 U.S.C. § 791; see Taylor v. Small, 350 F.3d 1286, 1291 (D.C.Cir.2003). Where, as here, a complaint alleges "nonaffirmative action employment discrimination," the Rehab Act expressly incorporates Title I of the Americans with Disabilities Act of 1990 (ADA), 42 U.S.C. §§ 12111 et seq., so that violations of the Rehab Act are judged by the standards of the ADA, see 29 U.S.C. § 791(g); Taylor v. Rice, 451 F.3d 898, 905 (D.C.Cir.2006).
Claims of disparate impact are distinct from claims of disparate treatment. The latter are premised on employer action that "treats some people less favorably than others because of their race, color, religion, sex, or national origin" and require proof of discriminatory intent.
The business necessity doctrine was developed by the Supreme Court in Griggs v. Duke Power Co., 401 U.S. 424, 91 S.Ct. 849, 28 L.Ed.2d 158 (1971). Disagreeing with the Court's later narrowing of employer liability in Wards Cove Packing Co. v. Atonio, 490 U.S. 642, 109 S.Ct. 2115, 104 L.Ed.2d 733 (1989), Congress codified a modified version of the defense into Title VII in 1991. P.L. No. 102-166, 150 Stat. 1071; see Smith v. City of Jackson, 544 U.S. 228, 240, 125 S.Ct. 1536, 161 L.Ed.2d 410 (2005). The defense is also embedded in the ADA in part. Section 12112(b)(6) of the ADA proscribes the use of:
42 U.S.C. § 12112(b)(6) (emphasis added). Plaintiffs' Complaint, however, does not allege that the decision to defund RSA regional offices violated this provision, focused as it is on selection criteria, or, for that matter, any specific provision of the ADA as the Rehab Act incorporates it. See Def.'s Mot. Summ. J. at 25. Further, neither party argues that the "business necessity" applicable to selection criteria, as codified in subsection 6 of § 12112(b), should apply throughout subsection (b), and the Court finds no support in the law for such a construction of the ADA as it applies to the Rehab Act.
The nature and proper application of the business necessity defense is at the heart of the present case. Plaintiffs contend that their statistical evidence shows adverse impact based on disability (a point the Secretary strongly contests and which the Court does not reach
The Supreme Court has explained that "[p]recisely what constitutes a business necessity cannot be reduced, of course, to a scientific formula, for it necessarily involves a case-specific judgment which must take into account the nature of the particular business and job in question." Watson, 487 U.S. at 1005, 108 S.Ct. 2777. If the "touchstone" of business necessity lies in a "reasoned review" of an employer's "legitimate employment goals," Wards Cove, 490 U.S. at 659, 109 S.Ct. 2115, then the particular facts and circumstances of the employer must inform the analysis; what may be a reasonable and legitimate goal for one employer may not support another's actions. The need for an analysis specific to the circumstances is particularly acute when comparing private-sector employer goals with those that are legitimate for policy makers in the federal government. Although the federal government may at times act like a business, its undertakings generally are not directed to the maximization of profits or satisfaction of shareholders, which can be easier metrics to measure.
Hence, the alleged adverse employment action that Plaintiffs have identified informs the analysis of the Secretary's business necessity defense. The manner in which Plaintiffs have framed their motion by way of their Opposition (and thus narrowed their Complaint) is significant.
The Plaintiffs' construction of their disparate impact claim is important because it is clear from the uncontested facts and circumstances that the decision to cut funding for RSA regional offices was a high-level management judgment. First, the multiple decision makers involved in the determination to defund RSA regional offices makes this reorganization atypical. It was not a decision made exclusively within OSERS or even the Department, as made obvious by the fact that the RSA Commissioner was not notified of the determination until January 2005. The decision instead was made in consultation with the White House, the Secretary, and OMB, and included in the FY06 budget. Second, the determination to defund RSA regional offices was not driven primarily by the anticipated cost savings. Although reflected in the FY06 budget and suggested to OMB by Mr. Justesen as a mechanism for cost reduction, the testimony from those involved in the decisionmaking process is clear that whether the closure and consolidation of RSA regional offices would actually save money was a secondary consideration. The principal motivation for defunding RSA regional offices, and thus centralizing RSA, was the management goal of improving the performance of federal agencies, promoting efficiencies, and achieving greater supervision over the regions.
The record before the Court suggests that advocates can readily debate whether defunding RSA regional offices was the best policy for RSA. But that is not the domain of the business necessity analysis as conceptualized by the Supreme Court. The question in the confines of this litigation is whether, upon a "reasoned review," Wards Cove, 490 U.S. at 659, 109 S.Ct. 2115, the decision to defund the RSA regional offices evidenced a legitimate business necessity. "[T]here is no requirement that the challenged practice be `essential' or `indispensable' to the employer's business to pass muster....," id. and it cannot be said that defunding RSA regional offices in order to achieve the policy goal of greater efficiency and central oversight was an illegitimate employment goal.
Plaintiffs' argument that the articulated goals of the defunding are invalid and insufficient does not alter the Court's conclusion. Plaintiffs accuse Secretary Spellings and Mr. Justesen of not understanding the functions, staffing, and importance of the regional offices. Yet, this supposed misapprehension of the duties of RSA regional offices only serves to suggest that a different decision may also have been justified, not that the preference for central oversight and reduced cost was an illegitimate judgment. Equally unpersuasive is Plaintiffs' contention that the federal government should have hired consultants and ordered longitudinal studies before acting. Just as "[t]he Constitution `does not enact Mr. Herbert Spencer's Social Statics,'" Sorrell v. IMS Health Inc., ___ U.S. ___, 131 S.Ct. 2653, 2665, 180 L.Ed.2d 544 (2011) (quoting Lochner v. New York, 198 U.S. 45, 75, 25 S.Ct. 539, 49 L.Ed. 937 (1905) (Holmes, J., dissenting)), neither do the Rehab Act nor the ADA require elected officials to undertake organizational
Similarly, the January 2005 email from Mr. Pepin, which asked senior OSERS managers to come up with "positive reasons" to tell employees for the decision to defund RSA regional offices, does not support Plaintiffs' case. Plaintiffs highlight the email as proof that the decision was made without forethought and that any rationale provided now is post hoc reasoning to be ignored. What is clear is that Mr. Pepin wanted to put the onus on OMB and apparently wanted some "spin" to the message to make it more palatable to RSA regional offices. Mr. Justesen's response is telling: he advised frankly informing the regions that the defunding was an "action to improve management," Ex. 23 at 1, which is exactly as Assistant Secretary Hager described it soon thereafter, Ex. 4 at 10 ("[W]hat we're talking about is the consolidation of work at the regional office. It has nothing to do with personality. It has nothing to do with the past.... What it is is a straight business decision that is a way to save on overhead and to consolidate the ... work....").
In short, the way in which the decision to defund RSA regional offices developed (i.e., vetted across agencies and ratified by high-ranking Executive Branch officials) and its purpose (i.e., streamlining an agency program to gain greater efficiency and central oversight, reflecting the operation of other agency programs) demonstrates that Plaintiffs in actuality challenge a policy judgment. And, contrary to Plaintiffs' argument, the Secretary's business necessity defense has been consistent throughout. The only remaining question then is whether Plaintiffs can establish the existence of alternatives that would have achieved the same business ends but with less impact on disabled employees. See Smith v. City of Jackson, 544 U.S. 228, 242, 125 S.Ct. 1536, 161 L.Ed.2d 410 (2005) (noting that "the business necessity test... asks whether there are other ways for the employer to achieve its goals that do not result in a disparate impact on a protected class"). Plaintiffs propose three alternatives: the Secretary could have (1) allowed telecommuting; (2) eliminated sixty-five positions across OSERS, rather than just RSA regional offices, through buyouts and attrition; or (3) identified non-essential positions and eliminated only those jobs. These suggestions, however, miss the point. Not only do they wrongly focus on the manner in which defunding was achieved, but they directly contradict the purposes of consolidation. Plaintiffs fail to explain how any of their proposed alternatives would have achieved a more efficient and streamlined RSA with greater central oversight. Each of their proposals would have maintained a dispersed RSA. Plaintiffs' perspective on how the Department could be organized is not objectively "wrong." But the challenged decision was vested in political appointees who implemented the President's management goals, not Plaintiffs'.
Right or wrong, presidential appointees in 2004-05 believed that a dispersed RSA suffered from program inefficiencies and redundancies and that streamlining RSA would reduce these problems while affording greater supervision. Plaintiffs argue that later developments demonstrate that eliminating funding for RSA regional offices actually harmed RSA, the taxpayers who rely on its services, and disabled individuals employed in RSA regional offices. To be sure, the Court's analysis would change if the Executive had articulated arbitrary or pretextual reasons for centralizing RSA regional offices. But the Secretary did not do so here. The decision was driven by a policy judgment on how to conduct the business of the federal government. In the context of the specific facts
Plaintiffs also assert a cause of action under a disparate impact theory in violation of the ADEA. Specifically, they contend that the Secretary's decision to defund RSA regional offices had a disparate impact on regional employees forty years and older. The Secretary counters with an argument that no federal appellate court has yet addressed on its merits.
Under existing case law, it is clear that the ADEA subjects private and federal employers to disparate treatment liability, see Aliotta v. Bair, 614 F.3d 556, 561 (D.C.Cir.2010), and the ADEA authorizes disparate impact claims against private employers, see City of Jackson, 544 U.S. at 239-40, 125 S.Ct. 1536. The outstanding question is whether disparate impact claims against the federal government also are cognizable under the ADEA. The Secretary urges the Court to answer this question in the negative, as many Judges of this District have concluded. See Allard v. Holder, 840 F.Supp.2d 269, 278-80 (D.D.C.2012) (Leon, J.); Am. Fed'n of Gov't Emps. TSA Local 1 v. Hawley, 481 F.Supp.2d 72, 91-92 (D.D.C.2006) (Kollar-Kotelly, J.); Silver v. Leavitt, Civ. No. 05-0968, 2006 WL 626928, at *13 (D.D.C. Mar. 13, 2006) (Bates, J.); Evans v. Atwood, 38 F.Supp.2d 25, 28-30 (D.D.C.1999) (Urbina, J.). But see Breen v. Peters, 474 F.Supp.2d 1, 6-7 (D.D.C.2007) (Roberts, J.) (finding that the portion of the ADEA applicable to federal employers "encompasses both disparate treatment and disparate impact cases, as both methods of proof seek redress for illegal discrimination").
As an initial matter, the Court notes the absence of substantive analysis of this issue by the federal appellate courts. Neither the Supreme Court nor the D.C. Circuit has confronted the issue directly. See Aliotta, 614 F.3d at 561 n. 4 (recognizing an open question as to whether federal employees may assert disparate impact claims under the ADEA, but declining to decide because plaintiffs "failed to demonstrate any adverse effect on older employees"); Koger v. Reno, 98 F.3d 631, 639 & n. 2 (D.C.Cir.1996) (assuming without deciding that disparate impact claims may proceed against federal employers and finding that plaintiffs could not establish a prima facie case of disparate impact); Arnold v. U.S. Postal Serv., 863 F.2d 994, 998 (D.C.Cir.1988) (same). Although decisions in the Ninth and Tenth Circuits have entertained claims of disparate impact against federal employers, see Lujan v. Walters, 813 F.2d 1051 (10th Cir.1987); Palmer v. United States, 794 F.2d 534 (9th Cir. 1986), neither Circuit has explained its analysis, see Walters, 813 F.2d at 1057-58; Palmer, 794 F.2d at 536-39.
Whether a statute provides a cause of action is a question of statutory construction. Touche Ross & Co. v. Redington, 442 U.S. 560, 568, 99 S.Ct. 2479, 61 L.Ed.2d 82 (1979). Accordingly, the appropriate starting place is the language of the ADEA. Barnhart v. Sigmon Coal Co., 534 U.S. 438, 450, 122 S.Ct. 941, 151 L.Ed.2d 908 (2002) ("As in all statutory construction cases, [courts] begin with the language of the statute."). Section 633a(a) of Title 29 of the U.S.Code is the ADEA federal-sector provision: it states that all federal "personnel actions affecting employees or applicants for employment who are at least 40 years of age ... shall be made free from any discrimination based on age." The ADEA does not define the phrase "any discrimination based on age."
Plaintiffs contend that the statute is clear on its face. Reasoning that courts commonly define the term "discrimination" to include both intentional and disparate impact claims, see, e.g., Lagerstrom, 408 F.Supp.2d at 1212, Plaintiffs argue that the phrase "any discrimination based on age" must necessarily import both disparate treatment and disparate impact claims into the ADEA federal-sector provision. However, statutory construction does not occur in a vacuum, and determining whether statutory language is plain and unambiguous depends not just on the language itself but also on "the specific context in which that language is used, and the broader context of the statute as a whole." Robinson v. Shell Oil Co., 519 U.S. 337, 341, 117 S.Ct. 843, 136 L.Ed.2d 808 (1997). Consequently, the Court will consider the legislative history and structure of the ADEA.
The federal-sector provision is an add-on to the ADEA. When enacted in 1967, the ADEA applied only to private-sector employers. Congress expanded its scope in 1974 as part of a statute aimed primarily at amending the Fair Labor Standards Act (FLSA). FLSA Amendments of 1974 § 28, 88 Stat. 74. The 1974 bill made two notable changes to the ADEA: (1) it revised the ADEA's definitions of "employer" and "employee" to include state and local governments and their employees for some claims, see 29 U.S.C. §§ 630(b), 630(f); and (2) it inserted a separate provision adding coverage over certain federal employers, 29 U.S.C. § 633a. See Kimel
Section 2000e-16(a) therefore is informative when interpreting the ADEA federal-sector provision. The immediate question is to what degree. Using a series of syllogisms,
Accepting Plaintiffs' textual argument would require the Court to disregard subsequent amendments to Title VII. As previously discussed, Congress amended Title VII in 1991, overruling Wards Cove in part, Pls.' Opp'n at 9 n.2; see also Nakshian, 453 U.S. at 166-67, 101 S.Ct. 2698. But Congress did not amend the ADEA. Plaintiffs gloss over this inconvenient congressional silence and argue that the ADEA federal-sector provision must be construed in strict conformity with Title VII, as amended. The Court declines to do so. However similar the federal-sector provisions in Title VII and the ADEA may be, see Nakshian, 453 U.S. at 166-67, 101 S.Ct. 2698 (right to trial by jury); Gomez-Perez, 553 U.S. at 488, 128 S.Ct. 1931 (retaliation), these two statutes also have important differences that cannot be ignored.
In fact, the differences between the ADEA and Title VII were essential to the holding in City of Jackson that age-based disparate impact claims are cognizable under the private-sector provision of the ADEA. City of Jackson noted that "the scope of disparate-impact liability under ADEA is narrower than under Title VII" because "age, unlike race or other classifications protected by Title VII, not uncommonly has relevance to an individual's capacity to engage in certain types of employment." 544 U.S. at 240, 125 S.Ct. 1536. As a result, the ADEA private-sector provision, but not the equivalent Title VII provision, permits any "otherwise prohibited" action "where the differentiation is based on reasonable factors other than age [(RFOA)]." 29 U.S.C. § 623(f)(1). City of Jackson explained that:
544 U.S. at 238-39, 125 S.Ct. 1536 (internal citations omitted). RFOA is an affirmative defense that must be proved by the employer, see Meacham v. Knolls Atomic Power Laboratory, 554 U.S. 84, 94, 128 S.Ct. 2395, 171 L.Ed.2d 283 (2008), and its availability was significant to the Court's finding that the ADEA permits disparate impact liability against private-sector employers. "Rather than support an argument that disparate impact is unavailable under the ADEA, the RFOA provision actually supports the contrary conclusion." City of Jackson, 544 U.S. at 239, 125 S.Ct. 1536.
Applied to the instant matter, the logic of City of Jackson dictates that this Court find that disparate impact claims are not cognizable under the ADEA federal-sector provision. In stark contrast to the ADEA's private-sector provision, there is no RFOA defense for the federal government provided in the statute's federal-sector provision. From this absence, Plaintiffs argue that the ADEA federal-sector provision does not allow any defense to age-based disparate impact claims against the federal government. See Pls.' Opp'n at 25 ("[T]he plain language of ... [the ADEA federal-sector provision] makes the affirmative defenses available to private sector employers unavailable to federal employers like Defendant." (citing 29 U.S.C. § 633a(f) ("Any personnel action of any department, agency, or other entity referred to in [§ 633a(a)] ... shall not be subject to, or affected by, any provision of this chapter...."))). The Court is persuaded that Plaintiffs are correct that an RFOA defense is not available to the federal government in an ADEA disparate impact case. Section 633a(f) expressly states that personnel actions subject to the ADEA federal-sector provision are not subject to any other section of the ADEA.
But Plaintiffs prove too much. The absence of an RFOA affirmative defense, or any other statutory defense for the federal government, undercuts their argument that the government can be per se liable for the disparate impact of neutral, non-discriminatory policy decisions. Congress
Moreover, the absence of the RFOA affirmative defense in the ADEA federal-sector provision buttresses the sovereign immunity analysis in which this Court's colleagues have engaged. See Allard, 840 F.Supp.2d at 280 (finding the ADEA federal-sector provision insufficiently clear to constitute an express waiver of sovereign immunity for disparate-impact claims against federal employers); Silver, 2006 WL 626928, at *13 (finding no waiver of the federal sovereign's immunity from disparate impact liability under ADEA, especially considering that City of Jackson "carefully limited its holding" to the ADEA private-sector provision). It is a bedrock principle of American law that, as Sovereign, the United States is immune from suit unless Congress has expressly waived that immunity. See, e.g., FAA v. Cooper, ___ U.S. ___, 132 S.Ct. 1441, 1448, 182 L.Ed.2d 497 (2012) ("[A] waiver of sovereign immunity must be `unequivocally expressed' in a statutory text." (citations omitted)). "Any ambiguities in the statutory language are to be construed in favor of immunity, so that the Government's consent to be sued is never enlarged beyond what a fair reading of the text requires." Id. (citations omitted). To find that Congress waived federal sovereign immunity here would require the Court to accept a bizarre premise: Congress subjected the United States to a theory of liability for which private employers, but not the federal government, enjoy a statutory affirmative defense, but failed to express its intent explicitly.
Plaintiffs counter that the ADEA federal-sector provision sufficiently waived federal sovereign immunity. They advocate the adoption of the Supreme Court's sovereign immunity analysis in Gomez-Perez. There, having found that the ADEA federal-sector provision encompasses retaliation claims against federal employers, the Supreme Court determined that the provision, which permits "[a]ny person aggrieved... [to] bring a civil action in any Federal district court of competent jurisdiction for such legal or equitable relief as will effectuate the purposes of this chapter," see 29 U.S.C. § 633a(c), "unequivocally waives sovereign immunity ... to remedy a violation of 633a." 553 U.S. at 491, 128 S.Ct. 1931. Plaintiffs correspondingly renew their textual argument, claiming that if "any discrimination" as used in the ADEA federal-sector provision is broad enough to encompass retaliation claims as in Gomez-Perez, then it also should be read expansively to cover disparate impact claims. By virtue of such a reading, sovereign immunity would be waived pursuant to § 633a(c). Cf. Forman v. Small, 271 F.3d 285, 297 (D.C.Cir.2001) (determining prior to Gomez-Perez that the ADEA waived the federal sovereign immunity for retaliation claims based "on the sweeping language used by Congress").
Plaintiffs' textual analysis does not support their sovereign immunity waiver argument. Essential to Gomez-Perez was the congruity between the ADEA federal-sector provision and Title VII. See 553 U.S. at 487-88, 128 S.Ct. 1931 (emphasizing that the ADEA federal-sector provision more closely resembled § 2000e-16 of Title VII than the ADEA private-sector provision because the ADEA federal-sector
Were claims of age-based disparate impact viable under the ADEA, the Court would still find in favor of the Secretary. This is because, contrary to Plaintiffs' assertion, the Secretary may not be entirely defenseless. Although the Supreme Court in Meacham held that "the business necessity test should have no place in ADEA disparate-impact cases," 554 U.S. at 97, 128 S.Ct. 2395, the force of that pronouncement is uncertain in litigation under the ADEA federal-sector provision since Meacham involved a suit against a private employer. Further, a remark in City of Jackson that "Wards Cove's pre-1991 interpretation of Title VII's identical language remains applicable to the ADEA" suggests that federal employers could have at their disposal the business necessity defense, as it existed prior to 1991.
In the alternative to its holding above, the Court thus considers whether the Secretary produced evidence of a business necessity to rebut the instant charges of disparate impact age discrimination. Since the parties focused on an RFOA defense to the ADEA claim, which the Court finds is not available to the federal government, they did not expressly litigate
If a claim of age-based disparate impact were viable against the federal government, the Court concludes that the manner in which Plaintiffs have framed their Complaint would prove as fatal to that as it did to their claim of disparate impact under the Rehab Act. As already discussed, Plaintiffs challenge a policy preference: the decision to defund RSA regional offices and consolidate functions at headquarters to increase oversight and reduce costs as a matter of management philosophy. Plaintiffs' theory of disparate impact liability under the ADEA would not survive summary judgment in the face of the Secretary's business necessity defense for the reasons analyzed above.
The Court will grant the Secretary's motion for summary judgment as to Plaintiffs' ADEA claims premised on disparate impact liability.
For the foregoing reasons, the Court will grant the Secretary's Motion for Partial Summary Judgment and deny Plaintiffs' Motion for Partial Summary Judgment. A memorializing Order accompanies this Memorandum Opinion.
Justesen Dep. at 248. Plaintiffs urge the Court to construe this response as proof that consolidating RSA regional offices into headquarters was not necessary to achieve uniformity in policy. See Pls.' Mot. Summ. J. at 39. However, it is not at all clear from this exchange whether Mr. Justesen could not recall the necessity of consolidation vis-à-vis policy uniformity (i.e., "it's been six years") or was admitting that the Secretary could have achieved policy uniformity through other means (i.e., "I don't know."). Plaintiffs' counsel might have resolved this ambiguity by asking additional questions but did not.
Webster's Third New International Dictionary Unabridged 2315 (3d ed. 2002).
29 C.F.R. § 1625.7(c). Plaintiffs identify several EEOC decisions in which the agency "applied and enforced the disparate impact theory of discrimination against the federal government, including in age cases...." Pls.' Opp'n at 15. Although in appropriate circumstances deference is due to an agency's interpretation of its enabling statute, see Chevron, U.S.A., Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837, 844, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984), this is not such a time. First, EEOC appears to have assumed the availability of a "reasonable factor other than age" defense under the ADEA federal-sector provision, but the Court finds that assumption doubtful. See infra Part III.B.4. Second, concerns about sovereign immunity discussed infra cannot be assuaged by mere agency proclamations, for "waiver of the Federal Government's sovereign immunity must be unequivocally expressed in statutory text...." Lane v. Pena, 518 U.S. 187, 192, 116 S.Ct. 2092, 135 L.Ed.2d 486 (1996) (emphasis added).
