No. 03-2009 _________________________________________ IN THE UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT _________________________________________ VIRGEN PARILLA, Plaintiff-Appellee/Cross-Appellant, v. IAP WORLDWIDE SERVICES VI, INC., IAP WORLDWIDE SERVICES, INC., GENE LUDLOW and ROY VARNER, Defendants-Appellants/Cross-Appellees. ______________________________________________ On Appeal from the United States District Court for the District Court of the Virgin Islands Case No. 02-CV-00112 ______________________________________________ Brief of the U.S. Equal Employment Opportunity Commission as Amicus Curiae Supporting Plaintiff-Appellee/Cross-Appellant ______________________________________________ JAMES L. LEE U.S. EQUAL EMPLOYMENT Deputy General Counsel OPPORTUNITY COMMISSION Office of General Counsel CAROLYN L. WHEELER 1801 L Street, NW, Room 7030 Acting Associate General Counsel Washington, DC 20507 (202) 663-4724 ANNE NOEL OCCHIALINO Attorney TABLE OF CONTENTS Table of Authorities . . . . . . . . . . . . . . . . . . . . .iii Statement of Interest. . . . . . . . . . . . . . . . . . . . . .1 Statement of the Issue . . . . . . . . . . . . . . . . . . . . .2 Statement of the Case. . . . . . . . . . . . . . . . . . . . . .3 A. Nature of the Case and Court of Proceedings . . . . .3 B. Statement of Facts . . . . . . . . . . . . . . . . . .3 C. District Court Decision . . . . . . . . . . . . . . .5 Summary of Argument. . . . . . . . . . . . . . . . . . . . . . .7 Argument . . . . . . . . . . . . . . . . . . . . . . . . . . . .9 THE PROVISION PROHIBITING THE RESOLUTION OF CLAIMS BEFORE AN ADMINISTRATIVE AGENCY IS UNENFORCEABLE AS A MATTER OF PUBLIC POLICY BECAUSE IT INTERFERES WITH THE COMMISSION'S INDEPENDENT STATUTORY AUTHORITY TO ENFORCE TITLE VII AND OTHER CIVIL RIGHTS STATUTES. A. Because the provision could be interpreted as prohibiting the filing of a charge of discrimination or assisting in an EEOC investigation, it potentially interferes with the Commission's law enforcement mission.. . . . . . . . 11 B. The prohibition on resolving claims before an administrative agency violates public policy because it interferes with the Commission's statutory obligation to seek compliance through conciliation and litigation. . . . . . . . . . . . . 17 Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Certificate of Compliance. . . . . . . . . . . . . . . . . . . 22 Certificate of Service . . . . . . . . . . . . . . . . . . . . 23 TABLE OF AUTHORITIES Cases EEOC v. Astra USA, Inc., 94 F.3d 738 (1st Cir. 1996) . . . 15, 16 EEOC v. Cosmair, Inc. L'Oreal Hair Care Div., 821 F.2d 1085 (5th Cir. 1987) . .. . . . . . 11, 13, 14, 15 EEOC v. Shell Oil Co., 466 U.S. 54 (1984) . . . . . . 12, 13, 14 EEOC v. Waffle House, Inc. . . . . . . . . . . . . . . .8, 18, 19 General Tel. Co. v. EEOC, 446 U.S. 318 (1980) .. . . . 14, 18, 19 Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20 (1991) 8, 14 Moses H. Cone Mem'l Hosp. v. Mercury Constr. Corp., 460 U.S. 1 (1983) . . . . . . . . . . . . . . . . . . . . . 11 Occidental Life Ins. v. EEOC, 432 U.S. 355 (1977) . . . . . . 12 Plaskett v. Bechtel Int'l, Inc., 243 F. Supp. 2d 334 (D.V.I. 2003) . . . . . . . . . . . . . . . 5, 6, 7, 8 Town of Newton v. Rumery, 480 U.S. 386 (1987) . . . . . . . . 10 Statutes and Regulations 29 U.S.C. § 216(c) . . . . . . . . . . . . . . . . . . . . . . 18 29 U.S.C. § 217 . . . . . . . . . . . . . . . . . . . . . . . 18 29 U.S.C. § 626(a)(1). . . . . . . . . . . . . . . . . . . . . 13 29 U.S.C. § 626(b) . . . . . . . . . . . . . . . . . . . . . . 17 29 U.S.C. § 626(f)(4). . . . . . . . . . . . . . . . . . . 15, 16 29 C.F.R. § 1620.30(a) . . . . . . . . . . . . . . . . . . . . 13 29 C.F.R. § 1620.30(b) . . . . . . . . . . . . . . . . . . . . 13 42 U.S.C. § 12117(a) . . . . . . . . . . . . . . . . . . . 12, 17 42 U.S.C. § 2000e et seq. . . . . . . . . . . . . . . . . . . .1 42 U.S.C § 2000e-5(b) . . . . . . . . . . . . . . . . 10, 12, 17 42 U.S.C. § 2000e-5(f)(1) . . . . . . . . . . . . . . . . 10, 17 Miscellaneous B. Lindemann & P. Grossman, Employment Discrimination Law (3rd ed. 1996) . . . . . 13 EEOC Compliance Manual Notice 915.002, "EEOC Enforcement Guidance on non-waivable employee rights under [ ] (EEOC) enforced statutes," (April 10, 1997), www.eeoc.gov/docs/waiver.html, . . . . . . . . . . . . . 16 No. 03-2009 _________________________________________ IN THE UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT _________________________________________ VIRGEN PARILLA, Plaintiff-Appellee/Cross-Appellant, v. IAP WORLDWIDE SERVICES VI, INC., IAP WORLDWIDE SERVICES, INC., GENE LUDLOW and ROY VARNER, Defendants-Appellants/Cross-Appellees. ______________________________________________ On Appeal from the United States District Court for the District Court of the Virgin Islands ______________________________________________ Brief of the U.S. Equal Employment Opportunity Commission as Amicus Curiae Supporting Plaintiff-Appellee/Cross-Appellant ______________________________________________ STATEMENT OF INTEREST The United States Equal Employment Opportunity Commission is charged with enforcing Title VII of the Civil Rights Act of 1964, 42 U.S.C. §§ 2000e et seq. ("Title VII") and other civil rights statutes. To carry out its enforcement mission, the Commission relies on employees' charges of discrimination to alert the Commission to potential violations of the statute. Under Title VII, and other statutes, the filing of a charge of discrimination triggers the Commission's obligation to investigate the charge and, if appropriate, to conciliate it. If conciliation is unsuccessful, the Commission may choose to enforce compliance by filing a civil action against the employer. The district court's decision in this case raises an important issue concerning the enforceability of arbitration agreements prohibiting employees from resolving claims before administrative agencies, which would include the Commission. Because of the importance of this issue to the Commission's enforcement mission, the Commission offers its views to the Court as a United States agency under Federal Rules of Appellate Procedure 29(a). STATEMENT OF THE ISSUE Whether the district court erred in finding that a provision of an arbitration agreement prohibiting an employee from resolving claims before an administrative agency is enforceable where enforcement would interfere with the Commission's independent statutory authority to vindicate the public interest under Title VII and other civil rights statutes.<1> STATEMENT OF THE CASE A. Nature of the Case and Course of Proceedings On August 21, 2002, Plaintiff-Appellee/Cross-Appellant Virgen Parilla filed this lawsuit against Defendants-Appellants/Cross-Appellees IAP Worldwide Services VI, Inc., IAP Worldwide Services, Inc., Gene Ludlow, and Roy Varner ("IAP") under Title VII and Virgin Island law alleging, among other things, that she had been sexually harassed and terminated in retaliation for complaining about the harassment. A29-34 (compl.); A2 (docket).<2> On September 16, 2003, IAP filed a Motion to Compel Arbitration. A35 (motion). In a Memorandum Opinion and separate Order, the district court denied the motion. A6 (memo.); A4 (order). On April 2, 2003, IAP Defendants filed a notice of appeal. A3 (docket). On May 6, 2003, Parilla also filed a notice of appeal from the district court's order, which is styled case No. 03-2308.<3> B. Statement of Facts On June 6, 2000, IAP Worldwide Service VI, Inc. ("IAP VI") hired Parilla as an administrative assistant. A6 (Slip op. at 1). Upon being hired, Parilla entered into an Hourly Employment Agreement ("Agreement") with IAP VI that states in relevant part, "[a]ny controversy or claim arising out of or relating in any way to . . . Employee's employment with Employer, or to the suspension or termination of Employee's employment with Employer . . . shall be resolved by arbitration and not in a court or before an administrative agency." A44, ¶ 16 (Agreement). The Agreement further provides that "[a]rbitrable matters include, but are not limited to . . . claims for wrongful or retaliatory discharge or wrongful treatment under . . . Federal law, including, . . . the Civil Rights Acts . . . , Title VII, the Equal Employment Opportunity Act, the Equal Pay Act . . . the Age Discrimination in Employment Act, the Americans with Disabilities Act . . . [and] claims for employment discrimination under . . . Federal law." A44-45, ¶ 17 (Agreement). The Agreement also states that the parties will pay their own attorney's fees regardless of the outcome of the arbitration, that the arbitrator may order the losing party to pay the entire cost of the arbitration, that the arbitrator cannot come from the Virgin Islands or Puerto Rico, that IAP must be notified of any claim within thirty days, and, through incorporation of the American Arbitration Association rules, that the names of the parties will be kept confidential unless a party expressly permitts its name to be made public. A45-45B. In approximately July 2002, IAP terminated Parilla's employment. A31, ¶¶ 19-20 (compl.). On August 21, 2002, Parilla filed suit against IAP. A28 (compl.); A2 (docket).<4> C. District Court Decision On March 26, 2003, the district court issued a short opinion and order denying IAP's motion to compel arbitration. A6 (memo.); A4 (order). The court concluded that the Agreement was in all material respects identical to another arbitration agreement at issue in Plaskett v. Bechtel Int'l, Inc., 243 F. Supp. 2d 334 (D.V.I. 2003).<5> A7 (slip op. at 2). The court went on to state that for the reasons set forth in Plaskett, the motion to compel arbitration would be denied. Id. The district court's only substantive discussion concerned its rejection of IAP's argument that the court should reconsider its holding in Plaskett that the waiver of attorney's fees is unconscionable under Title VII. A8 (slip op. at 3). Thus, the court's decision in this case rests on the reasoning of Plaskett. In Plaskett, the court concluded that the arbitration provisions at issue in the plaintiff's Hourly Employment Agreement contained multiple unconscionable terms that permeated the arbitration provisions and could not be severed from them, although the court concluded that the rest of the agreement (not relating to the arbitration provisions) was enforceable. See Plaskett, 243 F. Supp. 2d at 340- 46. The court began its analysis by concluding that the parties formed an agreement to arbitrate. Id. at 338. The court went on to apply general contract principles of territorial law to determine whether the arbitration agreement at issue was enforceable, which, the court stated, depended on whether the agreement was unconscionable. See id. at 339. The court concluded that three provisions of the agreement were unconscionable: 1) the provision requiring each party to bear its own attorney's fees, which the court found to be unconscionable since awards of attorney's fees should ordinarily be made to prevailing parties under Title VII (although not under Virgin Island law); 2) the provision requiring the employee to notify the employer of any claim within thirty days; and 3) the provision, incorporated by reference to the American Arbitration Association Rules, that the names of the parties to any arbitration award be kept confidential unless a party expressly permitted its name to be made public. See id. at 340-43. The Plaskett court determined, however, that the provision stating, "‘[a]ny controversy or claim . . . shall be resolved by arbitration and not . . . before an administrative agency'" was not unconscionable. Id. at 343-44. In the court's view, the provision simply barred either party from seeking "a judgment by an administrative agency." Id. at 343. Since the EEOC brings suit in its own name, not that of an employee, the court reasoned that "the EEOC does not have the authority to enter any judgment resolving any controversy or claim between the parties." Id. at 344. Because the plaintiff could not "waive a right that he has never had," the court determined that this provision was not unconscionable. Id. Finally, the court concluded that the unconscionable terms permeated the arbitration provisions, making severance of the offending terms inappropriate. See id. at 345. Therefore, the court denied the defendant's motion to compel arbitration, although it enforced the remainder of the Hourly Employment Agreement. For the same reasons, the court in this case denied IAP's motion to compel arbitration but enforced the remainder of the Agreement. SUMMARY OF ARGUMENT If it reaches the issue, this Court should find that the district court erred in concluding that the provision of the arbitration agreement prohibiting Parilla from resolving any claims before an administrative agency is enforceable. Enforcement of the provision would substantially interfere with the Commission's independent statutory authority to vindicate the public interest by enforcing Title VII and other civil rights employment statutes. Therefore, this Court should conclude that the provision violates public policy and, consequently, is unenforceable. Although Parilla filed a charge of discrimination, the prohibition on resolving claims before an administrative agency could be interpreted as prohibiting her from doing so. Since the Commission's authority to investigate discrimination under Title VII and the Americans with Disabilities Act ("ADA") is derived solely from the filing of a charge, and because the vast majority of charges are filed by employees, enforcement of provisions such as this one could potentially deprive the Commission of the opportunity to learn of alleged Title VII and ADA violations and could also impede the Commission's opportunity to investigate potential violations of the Equal Pay Act ("EPA") and the Age Discrimination in Employment Act ("ADEA"). Because a charge not only informs the Commission of alleged discrimination against the employee filing the charge but may also alert the Commission to other unlawful discrimination by the employer, enforcement of the provision could also impact the Commission's ability to learn of systemic discrimination. Enforcement of the provision would also directly conflict with Congress's mandate that the Commission seek compliance through conciliation and litigation where the Commission's investigation has led it to believe that a statutory violation has occurred. In Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20, 28 (1991), the Supreme Court held that ADEA claims are arbitrable but stated that arbitration agreements would not prevent the Commission from seeking class- wide or equitable relief. More recently, in EEOC v. Waffle House, Inc. 534 U.S. 279 (2002), the Court held that even where an employee has signed a pre- employment arbitration agreement, the Commission may seek victim-specific relief for that employee. Thus, enforcement of the Agreement's prohibition on resolving claims before an administrative agency contravenes Supreme Court precedent affirming that employees' agreements to arbitrate their claims does not vitiate the Commission's statutory authority to vindicate the public interest by resolving employment discrimination claims. ARGUMENT THE PROVISION PROHIBITING THE RESOLUTION OF CLAIMS BEFORE AN ADMINISTRATIVE AGENCY IS UNENFORCEABLE AS A MATTER OF PUBLIC POLICY BECAUSE IT INTERFERES WITH THE COMMISSION'S INDEPENDENT STATUTORY AUTHORITY TO ENFORCE TITLE VII AND OTHER CIVIL RIGHTS STATUTES. The district court erred in concluding that the provision of the Agreement prohibiting any claims from being resolved before an administrative agency is enforceable. The court reached this erroneous conclusion by reasoning that "the EEOC does not have the authority to enter any judgment resolving any controversy or claim between the parties" and therefore that Parilla "cannot waive a right that [s]he has never had." Plaskett, 243 F. Supp. 2d at 344. This reasoning reflects a fundamental misunderstanding about the Commission's statutory authority and utilizes an overly restrictive definition of "resolve." The Commission may "resolve" a charge of discrimination in several ways.<6> First, the Commission may resolve a charge when it fulfills its statutory mandate "to eliminate any . . . alleged unlawful employment practice by informal methods of conference, conciliation, and persuasion." 42 U.S.C. § 2000e-5(b). Second, although the Commission does not represent charging parties, the Commission may sue on behalf of a charging party and thereby resolve a charge of discrimination through litigation or settlement. See 42 U.S.C. § 2000e-5(f)(1). Third, upon agreement of the parties and even before an investigation begins, the Commission may resolve a charge through mediation.<7> Thus, although the Commission does not enter judgments resolving discrimination charges, the Commission may secure resolution of discrimination charges through conciliation and litigation, making the Agreement's prohibition on resolving complaints before an administrative agency unenforceable. "The relevant principle is well established: a promise is unenforceable if the interest in its enforcement is outweighed in the circumstances by a public policy harmed by enforcement of the agreement." Town of Newton v. Rumery, 480 U.S. 386, 392 (1987) (footnote omitted); see also Restatement (Second) of Contracts § 208 cmt. a (stating that the policy against unconscionable contracts "overlaps with rules which render particular . . . terms unenforceable on grounds of public policy"). Here, the interest served by enforcing the provision prohibiting the resolution of claims before an administrative agency is the encouragement of private settlement of employment disputes, which is in keeping with the "liberal federal policy favoring arbitration agreements" manifested in the Federal Arbitration Act. Moses H. Cone Mem'l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 24 (1983). For the reasons discussed below, however, that interest "is outweighed by the public interest in EEOC enforcement of the ADEA," EEOC v. Cosmair, Inc., L'Oreal Hair Care Div., 821 F.2d 1085, 1090 (5th Cir. 1987), as well as EEOC enforcement of Title VII, the ADA, and the EPA. Therefore, the provision is unenforceable as a matter of law. A. Because the provision could be interpreted as prohibiting the filing of a charge of discrimination or assisting in an EEOC investigation, it potentially interferes with the Commission's law enforcement mission. Although Parilla filed a charge of discrimination in this case, the prohibition on resolving claims before an administrative agency could be interpreted as having prohibited her from doing so and as prohibiting her from assisting in a Commission investigation. Such a prohibition would clearly violate public policy by undermining employees' statutory right to file charges and the Commission's independent statutory authority to investigate them. "[U]nder the procedural structure created by the 1972 amendments [to Title VII], the EEOC does not function simply as a vehicle for conducting litigation on behalf of private parties; it is a federal administrative agency charged with the responsibility of investigating claims of employment discrimination and settling disputes, if possible, in an informal, noncoercive fashion." Occidential Life Ins. v. EEOC, 432 U.S. 355, 368 (1977). Under Title VII and the ADA, the EEOC only has jurisdiction to investigate discrimination where a charge has been filed. See 42 U.S.C. § 2000e-5(b) (stating that "[w]henever a charge is filed by or on behalf of a person claiming to be aggrieved, or by a member of the Commission," the Commission shall investigate); 42 U.S.C. § 12117(a) (adopting Title VII procedures under the ADA); see also EEOC v. Shell Oil Co., 466 U.S. 54, 64 (1984) ("the EEOC's investigative authority is tied to charges filed with the Commission; unlike other federal agencies that possess plenary authority to demand to see records relevant to matters within their jurisdiction, the EEOC is entitled to access only to evidence ‘relevant to the charge under investigation'") (citation and footnote omitted). By far, the vast majority of charges filed under these statutes are filed by aggrieved employees. In contrast to Title VII and the ADA, the EEOC's investigative authority under the ADEA and EPA is not tied to the filing of a charge. See 29 U.S.C. § 626(a) (under ADEA, stating that the Commission "shall have the power to make investigations"); 29 C.F.R. § 1620.30(a)(1) (stating that under EPA the Commission may "investigate and gather data"). Nevertheless, the filing of charges by aggrieved individuals is the primary means through which the EEOC learns of possible discrimination under these statutes as well. See, e.g., B. Lindemann & P. Grossman, Employment Discrimination Law at 523 (3rd ed. 1996) ("Although the government can initiate investigations sua sponte, most [EPA] investigations are conducted in response to complaints lodged by employees."). Thus, in contrast to "a complaint initiating a lawsuit," the "function of a Title VII charge . . . is to place the EEOC on notice that someone (either a party claiming to be aggrieved or a Commissioner) believes that an employer has violated the title." Shell Oil, 466 U.S. at 68. Significantly, a charge is not restricted to merely notifying the Commission that the charging party may have been unlawfully discriminated against. Instead, a charge "also may identify other unlawful company actions." Cosmair, 821 F.2d at 1090. This is true because a charging party can allege that other co-workers have also been victims of discriminatory actions and because "[a]ny violations that the EEOC ascertains in the course of a reasonable investigation of the charging party's complaint are actionable." General Tel. Co. v. EEOC, 446 U.S. 318, 331 (1980) (citation omitted). Thus, prohibitions in arbitration agreements on the filing of charges impermissibly impedes the Commission's ability to learn not just about individual acts of discrimination against a charging party but also to learn about about systemic discrimination. See Shell Oil, 466 U.S. at 69 ("it is crucial that the Commission's ability to investigate charges of systemic discrimination not be impaired"). The Supreme Court has recognized the statutory right of employees to file charges, even when employees have agreed to arbitrate their claims against an employer. In Gilmer v. Interstate/Johnson Lane Corp. the Court held that an ADEA claim may be subject to arbitration but stated that "[a]n individual ADEA claimant subject to an arbitration agreement will still be free to file a charge with the EEOC, even though the claimant is not able to institute a private judicial action." Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20, 28 (1991) (emphasis added). Thus, the Court in Gilmer implicitly acknowledged that the filing of charges serves an important public interest that survives an employee's agreement to arbitrate an employment dispute. The Fifth Circuit has reached the same result in an ADEA case involving the enforceability of a waiver of the right to file a charge. See Cosmair, 821 F.2d at 1090. In Cosmair the Fifth Circuit held that "an employer and employee cannot agree to deny to the EEOC the information it needs to advance th[e] public interest. A waiver of the right to file a charge is void as against public policy." Cosmair, 821 F.2d at 1090; cf. EEOC v. Astra USA, Inc., 94 F.3d 738, 745-47 (1st Cir. 1996) (in preliminary injunction action under Title VII where EEOC was already investigating three charges of discrimination against employer, holding that no significant risk of irreparable harm existed where settlement agreement prohibited employees from filing charges). Congress reaffirmed the strong public policy against interfering with the EEOC's enforcement efforts when it enacted the Older Workers Benefit Protection Action of 1990 ("OWBPA"). This act states in part that "[n]o waiver agreement may affect the Commission's rights and responsibilities to enforce this chapter" and that no waiver may "justify interfering with the protected right of an employee to file a charge." 29 U.S.C. § 626(f)(4). Although the OWBPA concerns waivers, the public policy principles underlying Congress' explicit affirmation of employees' right to file a charge and the Commission's right and responsibility to enforce the ADEA – regardless of any waiver they may have signed – are the same as those at stake in pre-employment arbitration agreements. Therefore, to the extent that the Agreement in this case may be read to prohibit the filing of a charge of discrimination, it is clearly unenforceable as a matter of public policy. Similarly, to the extent that the Agreement's prohibition on resolving claims before an administrative agency can be construed as a prohibiting Parilla from assisting the Commission in its investigation, the provision is unenforceable. See, e.g., 29 U.S.C. § 626(f)(4) (stating that no waiver of ADEA claim may "justify interfering with the protected right of an employee to . . . participate in an investigation or proceeding conducted by the Commission"); Astra, 94 F.3d 738. In Astra, the EEOC sought a preliminary injunction under Title VII to prevent the employer from enforcing provisions of settlement agreements prohibiting employees from assisting the EEOC in its investigations. Astra, 94 F.3d at 740- 41. The court held that "non-assistance covenants which prohibit communication with the EEOC are void as against public policy." Id. at 745. In reaching its conclusion, the court stated that "if victims of or witnesses to sexual harassment are unable to approach the EEOC or even to answer its questions, the investigatory powers that Congress conferred would be sharply curtailed and the efficacy of investigations would be severely hampered." Id. at 744. Noting that the Commission acts not just on behalf of private parties but also to vindicate the public interest, the court further stated, "any agreement that materially interferes with communication between an employee and the Commission sows the seeds of harm to the public." Id. (citation omitted); see also EEOC Compliance Manual Notice 915.002, "EEOC Enforcement Guidance on non-waivable employee rights under [ ] (EEOC) enforced statutes," (April 10, 1997), www.eeoc.gov/docs/waiver.html, ("An employer may not interfere with the protected right of an employee to file a charge, testify, assist, or participate in any manner in an investigation, hearing, or proceeding under Title VII," the ADA, the ADEA, or the EPA). B. The prohibition on resolving claims before an administrative agency violates public policy because it interferes with the Commission's statutory obligation to seek compliance through conciliation and litigation. On its face, the Agreement's prohibition on resolving claims before an administrative agency precludes the Commission from resolving Parilla's Title VII claim through conciliation or litigation. This provision runs afoul of Congress' mandate, as expressed in Title VII, the ADA, and the ADEA, that the Commission seek voluntary compliance through conciliation and, when necessary, through litigation. See 42 U.S.C. §§ 2000e-5(b) (under Title VII, stating that if the Commission determines "that there is reasonable cause to believe that the charge is true, the Commission shall" attempt conciliation), 2000e-5(f)(1) (if conciliation is unsuccessful, "the Commission may bring a civil action"); 42 U.S.C. § 12117(a) (under ADA, adopting the "powers, remedies, and procedures" of 42 U.S.C § 2000e-5); 29 U.S.C. § 626(b) (under ADEA, stating that Commission must attempt conciliation before instituting any action). See also 29 C.F.R. § 1620.30(a)(6) (stating that under the EPA, the Commission may initiate and conduct litigation).<8> Therefore, the provision violates public policy and is unenforceable. The 1972 amendments to Title VII authorized the Commission to bring suit against private employers. "In so doing, Congress sought to implement the public interest as well as to bring about more effective enforcement of private rights." General Tel., 446 U.S. at 325-26. The amendments did not, however, transfer to the Commission all responsibility for enforcing private rights. See id. at 326. Instead, individuals are also able to bring their own actions to enforce Title VII. See id. "These private-action rights suggest that the EEOC is not merely a proxy for the victims of discrimination." Id. Thus, while the Commission may seek victim-specific relief, the Commission "is guided by ‘the overriding public interest in equal employment opportunity . . . asserted through direct Federal enforcement.'" Id. (quoting 118 Cong. Rec. 4941 (1972)). Therefore, "[w]hen the EEOC acts, albeit at the behest of and for the benefit of specific individuals, it acts also to vindicate the public interest." Id. (footnote omitted); see also Waffle House, 534 U.S. at 296 (stating that when the EEOC decides to bring an enforcement action, "the agency may be seeking to vindicate a public interest, not simply provide make-whole relief for the employee, even when it pursues entirely victim-specific relief"). Pre-employment arbitration agreements entered into by employees and employers do not vitiate the Commission's authority – and, indeed, its statutory obligation – to vindicate the public interest by enforcing Title VII and other statutes through conciliation and litigation. See Waffle House, 534 U.S. 279; Gilmer, 500 U.S. 20. As discussed supra, in Gilmer the Supreme Court held that ADEA claims may be subject to arbitration. Gilmer, 500 U.S. at 35. In rejecting the argument that arbitration does not adequately further the purposes of the ADEA because arbitration does not allow for equitable relief and class actions, the Supreme Court stated, "it should be remembered that arbitration agreements will not preclude the EEOC from bringing actions seeking class-wide and equitable relief." Gilmer, 500 U.S. at 32 (emphasis in original). More recently, in EEOC v. Waffle House the Supreme Court held that the EEOC may seek not only class-wide and equitable relief where an employee has signed a pre-employment arbitration agreement, but that the Commission may also seek victim-specific relief. See Waffle House, 534 U.S. 279. In reaching that conclusion, the Court stated that "[t]here is no language in the statutes or in either" Occidental Life or General Telephone "suggesting that the existence of an arbitration agreement between private parties materially changes the EEOC's statutory function or the remedies that are otherwise available." Waffle House, 534 U.S at 288. When weighing the policy goals of the FAA against the language of Title VII and the arbitration agreement the plaintiff had signed, the Court further stated: No one asserts that the EEOC is a party to the contract, or that it agreed to arbitrate its claims. It goes without saying that a contract cannot bind a nonparty. Accordingly, the proarbitration policy goals of the FAA do not require the agency to relinquish its statutory authority if it has not agreed to do so. Id. at 294. Thus, in this case, the IAP Agreement's prohibition on resolving claims before an administrative agency contravenes the teachings of Waffle House in that the Supreme Court has expressly held that the EEOC may pursue victim- specific relief even where an employee has signed an arbitration agreement. In short, the Agreement's prohibition on resolving claims before an administrative agency prevents the remedial principles of Title VII and other civil rights statutes from being effectuated by interfering with the Commission's independent statutory authority to serve the public interest by resolving complaints of unlawful employment discrimination. CONCLUSION The provision of the Agreement between Parilla and IAP VI that prohibits the resolution of claims before an administrative agency directly contravenes the statutory framework and principles of Title VII and the other civil rights statutes enforced by the Commission by interfering with the Commission's statutory authority – and obligation – to vindicate the public interest by eradicating unlawful employment discrimination. Therefore, the provision violates public policy and is unenforceable as a matter of law. Respectfully submitted, JAMES L. LEE Deputy General Counsel CAROLYN L. WHEELER Acting Associate General Counsel __________________________ ANNE NOEL OCCHIALINO Attorney U.S. EQUAL EMPLOYMENT OPPORTUNITY COMMISSION 1801 L Street, NW, Room 7030 Washington, DC 20507 (202) 663-4724 CERTIFICATE OF COMPLIANCE I certify that this brief complies with the type-volume limitation set forth in Fed. R. App. P. 32(a)(7)(B). This brief contains 4,380 words. ____________________________ ANNE NOEL OCCHIALINO August 7, 2003 CERTIFICATE OF SERVICE I certify that on August 7, 2003, I served two copies of this brief by mailing them overnight mail to the following: K. Glenda Cameron, Esq. LAW OFFICES OF LEE J. ROHN 1101 King St., Ste. 2 St. Croix, Virgin Islands 00820 Attorney for Plaintiff-Appellant Francis J. D'Eramo, Esq. NICHOLAS NEWMAN LOGAN & E'ERAMO, P.C. 1131 King St. Christiansted, St. Croix U.S. Virgin Islands 00820-4971 Attorney for Defendant-Appellee ____________________________ Anne Noel Occhialino Attorney U.S. EQUAL EMPLOYMENT OPPORTUNITY COMMISSION Office of General Counsel 1801 L Street, NW, Room 7030 Washington, DC 20507 (202) 663-4724 ********************************************************************* <> <1> The Commission takes no position on any other issue raised in this appeal. <2> Reference to “A” is to IAP’s appendix. <3> IAP has filed with this Court a motion to dismiss Parilla’s cross-appeal for lack of jurisdiction. Parilla has also filed with this Court a motion to dismiss three of the IAP Defendants (IAP Worldwide Services, Inc., Gene Ludlow, and Roy Varner) for lack of jurisdiction. <4> Parilla filed a charge of discrimination with the Virgin Island Department of Labor that was referred to the EEOC. A204 (8/7/02 letter to IAP). Although apparently not in the record, the EEOC subsequently dismissed Parilla’s charge upon learning that she had filed suit. <5> Plaskett was not appealed <6> The Q & A section of the EEOC’s web page even contains a section called “How Does EEOC Resolve Discrimination Charges?” See www.eeoc.gov/facts/qanda.html. <7> The EEOC voluntarily implemented its mediation program; it is not required by statute. See generally www.eeoc.gov/mediate/facts.html. <8> The Commission is not required to conciliate EPA charges before filing suit under the EPA, see 29 U.S.C. §§ 216(c), 217, although the Commission does conciliate a number of EPA charges each year. See www.eeoc.gov/stats/epa.html (providing statistics concerning EPA charges received and resolved).