LAMP Feature

USERRA and the "Cat's Paw" Theory of Employer Liability after Staub

Since its enactment in 1994, the Uniformed Services Employment and Reemployment Rights Act (USERRA) has provided a powerful means of addressing employment discrimination against those serving in the military. The Act forbids an employer from denying "employment, reemployment, retention in employment, promotion, or any benefit of employment" based on an employee's "membership" or "obligation" to participate in uniformed services and establishes employer liability "if the person's membership . . . is a motivating factor in the employer's action."1 In March 2011 the U.S. Supreme Court enlarged the scope of the Act's protections in Staub v. Proctor Hospital2 by extending the reach of "cat's paw" liability in an employment discrimination case brought by a U.S. Army reservist under the Act. Since Staub was decided, other courts have applied the requirements of the new "cat's paw" rule and revealed unresolved issues about which employment lawyers and their clients must be aware.

Plaintiff Vincent Staub, a radiologist and Army reservist, sued his employer Proctor Hospital, alleging that his supervisors filed a disciplinary report against him in which they falsely accused him of violating a hospital policy. The supervisors did this, he alleged, because they harbored hostility toward his military obligations and consequent absences from work, as evidenced by derogatory comments the supervisors had made about his service. The supervisors did not have the decision-making authority to fire Staub, but the Vice President of Human Resources fired him after reviewing the supervisors' disciplinary report, examining his personnel record, and speaking with his co–worker about his absences. A jury found the hospital liable for discrimination under the USERRA and awarded damages of $57,640 to Staub because his military status was "a motivating factor" in the vice president's decision to fire him.

The U.S. Court of Appeals for the Seventh Circuit reversed the judgment, concluding that the hospital was entitled to judgment as a matter of law.3 Because Staub had alleged a "cat's paw" theory of liability, the appellate court reasoned, he was required to show that the biased supervisors had exerted a "singular influence" over the ultimate decision-maker (the vice president). The appellate court determined that the hospital was immune from liability because of undisputed evidence that, in deciding to fire Staub, the vice president had relied upon personnel records and a co-worker interview in addition to the supervisors' disciplinary report.

The term "cat's paw" derives from a fable in which a monkey convinces a cat to reach into a fire to extract roasting chestnuts; the cat burns its paws and loses all of the chestnuts to the monkey, who escapes unscathed with the bounty. The term was first introduced in the employment-law context in the Seventh Circuit case Shager v. Upjohn. 4 Shager explained that the decision-maker for the employer ("the cat") can be liable to an employee for employment discrimination where the decision-maker relies on advice colored by the discriminatory animus of a supervisor ("the monkey") in making an adverse employment decision; if the decision-maker was the conduit of the supervisor's prejudice ("the cat's paw"), the decision-maker's own lack of animus would not protect the company from liability.

Although Shager suggested that an employer could be liable under the "cat's paw" theory so long as any taint or influence by a biased supervisor made the decision-maker a conduit of the supervisor's prejudice, the Seventh Circuit later embraced a stricter approach in applying the theory. By the time it decided Staub, the Seventh Circuit required a biased supervisor to exert a "singular influence" over the decision-maker's employment decision against the employee for the employer to be liable for the supervisor's bias. Because of disagreement within and outside of the Seventh Circuit over the degree of influence that the supervisor must wield over the decision-maker for "cat's paw" liability to apply, the Supreme Court granted certiorari in Staub.

Reversing the Seventh Circuit, the Supreme Court in Staub rejected the requirement that the supervisor exert a "singular influence" over the decision-maker to establish employer liability under the "cat's paw" theory.5 The Court imported principles of tort and agency law to explain that, where the decision-maker's independent investigation into the employee's performance relies in part on facts provided by the biased supervisor, the supervisor's actions and discriminatory animus remain a "proximate cause" of the adverse employment decision. Proximate cause, the Court explained, requires only "some direct relation" between alleged injurious conduct and the employee's injury, and it is possible for an injury to have several proximate causes. Therefore, the Court reasoned, the supervisor's actions and animus and the decision-maker's exercise of judgment following an independent investigation made in reliance on the supervisor's facts may constitute proximate causes of an adverse employment decision.

The Court further explained that the approach advocated by the hospital would be inconsistent with laws designed to prevent employer discrimination, for that approach would immunize an employer as long as the employer "isolates a personnel official from an employee's supervisors, vests the decision to take adverse employment actions in that official, and asks that official to review the employee's personnel file," even though the file is composed of recommendations by biased supervisors.6 The Court concluded, "[I]f a supervisor performs an act motivated by antimilitary animus that is intended by the supervisor to cause an adverse employment action, and if that act is a proximate cause of the ultimate employment action, then the employer is liable under USERRA."7 After the case was reversed and remanded to the Seventh Circuit, Staub settled his claims with Proctor Hospital.

In the aftermath of Staub, a supervisor's antimilitary bias against an employee may now form the basis of employer liability under USERRA for a discriminatory employment decision, even if the actual decision-maker does not rely solely on the supervisor's assessment of the employee in making the decision. Liability attaches, the Supreme Court explained, if (1) the employee's supervisor is motivated by antimilitary animus, (2) the supervisor performs an act intended to cause an adverse action against the employee, and (3) that act is a proximate cause of the decision-maker's adverse employment action.8

Following the Supreme Court's Staub decision, other courts have determined that the newly articulated "cat's paw" theory extends beyond discrimination claims brought under USERRA and applies to discrimination claims brought under the Americans with Disabilities Act,9 retaliation claims under state workers' compensation statutes and the Family and Medical Leave Act, discrimination claims under state whistleblower protection statutes,10 and retaliation and discrimination claims under Title VII of the Civil Rights Act of 1964.11 But courts disagree over whether the theory may apply in cases brought under the Age Discrimination in Employment Act of 1967 due to that statute's heightened causation standard.12 And courts have yet to express a view on the legal standard applicable to "cat's paw" claims under 42 U.S.C. §1983.13

Before filing "cat's paw" claims under these statutes, plaintiffs should exploit fully the available internal grievance processes within their companies.14 When preparing for litigation, plaintiffs should broadly consider all potential adverse actions (e.g., termination or transfer) and all potential non-decision-makers (e.g., supervisors and co-workers) when developing their theories of proximate cause under the new "cat's paw" framework. (The Supreme Court in Staub expressly reserved the question whether a non-supervisory coworker's bias could serve as a proximate cause.15) Plaintiffs must assert the "cat's paw" theory of liability at some point before trial (such as in a pretrial filing, in proposed jury instructions, or at a pre-trial or trial conference). The ultimate burden to prove the elements of the theory rests with the plaintiffs, and in doing so plaintiffs cannot rely on mere speculation of animus—they must point to concrete evidence suggesting animus.16

As courts continue to define the full extent of Staub, what remains clear is that the Supreme Court's decision strengthens USERRA protections available to military personnel by providing a more robust means of shielding servicemembers from discrimination in civil employment.

Alexandra Lee Newman and Yelena Shagall are staff law clerks for the United States Court of Appeals for the Seventh Circuit in Chicago. The views expressed in this article are the authors' alone, and should not be construed as directly or indirectly reflecting or revealing the opinions of any judge on the court.

1 38 U.S.C. § 4311.

2 131 S. Ct. 1186 (2011).

3 560 F.3d 647 (7th Cir. 2009).

4 913 F.2d 398 (7th Cir. 1990).

5 Staub, 131 S. 1190–94.

6 1192–93.

7 Id. at 1194 (emphasis in original).

8 Id.

9 Dickerson v. Bd. of Trs. of Cmty. Coll. Dist. No. 522, 657 F.3d 595, 602 (7th Cir. 2011).

10 Walsh v. Town of Millinocket, 28 A.3d 610 (Me. 2011).

11 See Staub, 131 S. Ct. at 1192 (noting that USERRA is "very similar to Title VII"); see also, e.g., McKenna v. City of Phila., 649 F.3d 171, 177 n.5 (3d Cir. 2011).

12 Compare Simmons v Sykes Enters., Inc., 647 F.3d 943, 949–50 (10th Cir. 2011) (forbidding ADEA claim), with Shelley v. Geren, 666 F.3d 599 (9th Cir. 2012) (applying Staub to ADEA claim) and Marcus v. PQ Corp., Nos. 11-2009, 11-2066, 2012 WL 149802, at *2 (3d Cir. Jan. 19, 2012) (nonprecedential order) (same).

13 See, e.g., Okon v. Harris County Hosp. Dist., 426 F. App'x 312, 319 (5th Cir. May 23, 2011) (nonprecedential order).

14 See Staub, 131 S. Ct. at 1194 n.4.

15 Id.

16 McKenna v. City of Phila., 649 F.3d 171, 179 (3d Cir. 2011).