Supreme Court Determines “Cat’s Paw” Theory Applies To Claims Brought Under

Uniformed Services Employment and Reemployment Rights Act (USERRA)

On March 1, 2011, the Supreme Court of the United States, in the case Staub v. Proctor Hospital, 562 U.S. ____ (2011), determined that an employer may be liable under the Uniformed Services Employment and Reemployment Rights Act (USERRA) for employment decisions influenced, but not made, by an employee with a discriminatory animus.

Plaintiff, a member of the United States Army Reserve, was employed by the Defendant until 2004 when he was fired for failing to notify his supervisor that he had completed his work with his patients and had no cases, a directive resulting from a prior corrective action.  Plaintiff alleged that his supervisor and that supervisor’s supervisor were hostile to him because of his military obligations.  Plaintiff filed suit against Defendant alleging that he was discriminated against based on his membership in or obligation to perform uniformed services in violation of USERRA.  In support of his claim Plaintiff asserted that his supervisor’s supervisor fabricated his misconduct and that the decision maker relied on those accusations in terminating him.

Reversing the Seventh Circuit, the Supreme Court determined that Plaintiff’s theory of liability, commonly referred to as a “cat’s paw” theory, could support a cause of action brought pursuant to USERRA.  Interpreting the statutory language that a service person’s membership must be a “motivating factor in the employer’s action,” the Supreme Court explained that “[w]hen a decision to fire is made with no unlawful animus on the part of the firing agent, but partly on the basis of a report prompted (unbeknownst to that agent) by discrimination, discrimination might perhaps be called a “factor” or a “causal factor” in the decision; but it seems to [the Court] a considerable stretch to call it ‘a motivating factor.’”

Nevertheless, the Court failed to apply its interpretation of the term “motivating factor” under these facts as “an implausible meaning of the text.”  Instead the Court focused on the “improbable consequence” that would result if USERRA required a de facto decision maker to have a discriminatory animus: employers could avoid liability by designating an isolated decision maker to make employment determinations based on an employee’s personnel file, that was replete with “discriminatory acts and recommendations of supervisors that were designed and intended to produce the adverse action.”

The Court, therefore, applied proximate cause principles, and held, that “[a]nimus and responsibility for the adverse action can be attributed to the earlier agent if the adverse action is the intended consequence of that agent’s discriminatory conduct.  So long as the agent intends, for discriminatory reasons, that the adverse action occur, he has the [state of mind] required to be liable under USERRA.”  Because there was evidence in this case that Plaintiff’s supervisors were motivated by hostility towards Plaintiff’s military obligations, the Supreme Court held that there was evidence that the supervisors’ fabrication of misconduct caused his termination.

The Court’s decision emphasizes the need for independent investigations of facts articulated in support of an adverse employment action.  In this case, Plaintiff challenged his termination through the grievance process alleging that his misconduct was fabricated.  The decision maker, however, never investigated Plaintiff’s allegations of fabrication.  The Court’s decision opens the door to greater scrutiny of the factual circumstances underlying employment decisions, specifically the motives of employees reporting any misconduct.  To combat this scrutiny, employers must be willing to conduct thorough investigations into factual allegations.

© 2011 Kiesewetter Wise Kaplan Prather, PLC