Avoiding and Defending Claims of Cat’s Paw Liability in Employment Discrimination Cases
In the complex, overlapping world of employment decisions it is common for a decision maker to rely on various other sources of information in making a termination decision.1 This may include considering recommendations of a low-level supervisor or even relying on past discipline issued by that supervisor. Due to time constraints, assuming that the supervisor knows the facts better, or simply not paying close attention, a decision maker sometimes is tempted to blindly rely on the recommendation or past discipline without verifying the facts or arriving at their own independent determination. Regardless of the merits of the ultimate termination decision, this can lead to what is known as "cat's paw liability" for the employer if the underlying supervisor was illegally basing their recommendation or prior issued discipline on a protected characteristic.
These cases tend to pose interesting problems from a defense perspective as the employer may face significant liability even if the decision maker had no discriminatory intent whatsoever. This Article will review the history of cat's paw liability in the Seventh Circuit, focus on how counsel can advise their clients to avoid such situations in the first place and, if a claim is made, outline strategies to defend against such claims.
I. Overview of Cat's Paw Liability in the Seventh Circuit
The term "cat's paw" comes from a 17th century fable entitled "The Monkey and the Cat" by Jean de La Fontaine.2 In the story, a monkey convinces an unsuspecting cat to retrieve chestnuts from a fire. In the end, the cat burns its paws while the monkey devours the retrieved chestnuts.3 In today's parlance, it refers to one being an unwitting dupe or tool for another's purposes.
The Seventh Circuit Court of Appeals (covering Wisconsin, Illinois, and Indiana)4 has recognized the concepts behind cat's paw liability in the employment discrimination context since at least 1990. In Shager v. Upjohn Co., the court analyzed whether the discriminatory animus of a supervisor could taint the ultimate termination decision of the employer's committee.5 "If [the committee] acted as the conduit of [the supervisor's] prejudice—his cat's paw—the innocence of its members would not spare the company from liability."6 While the theory did not garner much attention at the Seventh Circuit over the following decade or so, the doctrine began receiving increased attention in decisions such as Brewer v. Bd. of Trustees of Univ. of Ill., in which the Seventh Circuit developed specific contours for the application of cat's paw liability.7 There, the court held that application of the cat's paw theory was inappropriate "where a decision maker is not wholly dependent on a single source of information, but instead conducts its own investigation into the facts relevant to the decision."8 The court expounded that "[i]t does not matter that in a particular situation much of the information has come from a single, potentially biased source, so long as the decision maker does not artificially or by virtue of her role in the company limit her investigation to information from that source."9 This holding rendered the circumstances in which cat's paw liability could be asserted rather narrow and circumscribed and was a largely employer-friendly decision.
The Seventh Circuit continued its use of these principles in Staub v. Proctor Hospital.10 In Staub, the plaintiff was a reservist military member who was protected by the Uniformed Services Employment and Reemployment Rights Act (USERRA).11 After working for his employer for over ten years, he was eventually fired by the decision maker, who admitted she would not have terminated the plaintiff without the prior write-ups and complaints from the lower-level supervisors.12 Further, there was ample evidence in favor of the plaintiff that the lower-level supervisors treated him unfavorably because of his military status.13 This led a jury to find in plaintiff's favor based on cat's paw liability. Despite this, on appeal the Seventh Circuit overturned the decision, relying on the prior Brewer language, and held that "[d]ecisionmakers usually have to rely on others' opinions to some extent because they are removed from the underlying situation. But to be a cat's paw requires more; true to the fable, it requires a blind reliance, the stuff of 'singular influence.'"14
The United States Supreme Court accepted review and overturned the Seventh Circuit's decision, along with the doctrines developed and applied in Brewer and Staub.15 The Supreme Court analyzed the issues under tort principles of proximate cause and agent liability and determined that the Seventh Circuit's limitations on cat's paw liability were not appropriate. There was no basis under these principles to limit liability to situations in which the supervisor was a "singular influence" on the decision maker. Rather, the court held that, "if a supervisor performs an act motivated by  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."16 This proximate cause approach was much more employee-friendly than the "singular influence" standard previously used by the Seventh Circuit in Brewer and Staub.
Perhaps unsurprisingly, this broadening of the availability of cat's paw liability under Staub has led to an increase in such claims by plaintiffs, along with increased challenges for employers and defense counsel.17 Recent developments provide guidance on avoiding such claims in the first place and, if asserted, how to successfully defend against them.
II. Insulating Employment Decisions from the Influence of the Menacing Monkey
Of course, the best way to defeat a cat's paw claim is by never having to face one in the first place. If one can insulate the cat (decision maker) from the undue influences of the monkey (supervisor) and ensure that the decision is based on independent, corroborated evidence, the decision is unlikely to face cat's paw scrutiny. There are several practices that attorneys can recommend that their clients adopt to insulate employment decisions from such claims, or to at least assist in making them as legally defensible as possible.
As described above, cat's paw liability can arise anytime the underlying supervisor's acts are motivated by illegal animus and that animus is a proximate cause of an adverse employment decision. Thus, the challenge becomes severing the proximate cause between the potential illegal act of the supervisor and the ultimate employment decision.
Recent decisions demonstrate how to effectively insulate such employment actions against cat's paw claims. In Woods v. City of Berwyn, the Seventh Circuit was faced with a situation in which it was alleged that the age-based bias of the fire chief had illegally influenced the termination decision made by the Fire and Police Commission Board.18 In Woods, there were several events preceding plaintiff's termination which could lead a jury to believe that the fire chief was biased against plaintiff because of his age. Eventually, the fire chief recommended to the Board that the plaintiff be terminated. The Board held its own evidentiary hearing, where the employee was represented by counsel, in which the Board: (1) heard testimony, opening statements and closing statements; (2) viewed exhibits and ruled on objections; (3) ruled on objections that went for and against the employee; and (4) issued an eight page decision setting forth its findings and conclusions.19
However, as the Woods court readily noted, under Staub, "because the unbiased decision-maker could possibly rely on facts provided by the biased supervisor, a formal adversarial procedure does not automatically break the chain of causation."20 Thus, it was crucially important that the Board almost exclusively relied on, and cited to, the testimony of another firefighter who was not alleged to have any animus against the plaintiff. Thus, "the hearing broke the chain of causation because the record shows that the Board did not rely on the facts presented by the presumably biased [fire chief.]"21 The court cautioned, however, that, "[h]ad the Board relied on [the fire chief's] statements or failed to independently determine whether the conversation [justifying termination] happened, this might be a different case."22
From Woods and past decisions it can be said that a cat's paw theory is unlikely to be brought, or will easily be defeated, where the decision maker: (1) performs their own independent investigation of the grounds supporting the employment action; (2) relies almost exclusively on testimony or documents created by unbiased or disinterested individuals instead of on the individual initially making the recommendation; and (3) provides the employee a brief opportunity to rebut or disprove the allegations.
This suggests that developing formal policies (or improving ones already in place) for internal review processes is warranted and justified to insulate against such claims. While it may not be financially feasible for smaller employers, those that can afford the added upfront costs must seriously consider policies that require independent investigations of all significant adverse employment actions, such as lengthy suspensions or terminations. The usefulness of such review processes can be seen in recent decision from other circuits as well, such as the Tenth Circuit's decision in Thomas v. Berry Plastics Corp.23
Ideally, the policy should provide for a small review panel of two to three disinterested managers to undercut any suggestion that a single reviewer is biased against the employee. Further, the policy should require that the review panel not rely on or consider the initial recommendation but instead independently arrive at its own decision based on its own investigation. Also, the review panel should not rely solely on past-issued discipline documents but should independently verify the legitimacy of such past discipline, if possible. Finally, the process should provide a brief, informal process for the employee to rebut the bases for the adverse employment action. Given that the defense costs alone for a single "average" discrimination case can approach or exceed $100,000, not to mention the possibility of opposing attorneys' fees and damages, insulating against several claims can easily pay for the added upfront costs many times over. While such a review process may seem daunting, each review need not be a Watergate investigation. Most situations would not require expending more than several hours of time.
The effects of not having any review process can be seen in a recent decision from the Western District of Wisconsin. In Hamzah v. Woodman's Food Mkt., Inc., the employer was able to obtain summary judgment against a pro se plaintiff on all claims asserted except one—a Title VII discrimination claim based on cat's paw liability.24 There were no allegations that the decision maker had any animus against the plaintiff or that his decision was discriminatory. However, completely unbeknownst to the decision maker, two of the plaintiff's lowlevel supervisors had made inappropriate racial comments to him.25 The district court denied summary judgment and found that the pro se plaintiff presented enough evidence that a reasonable jury could conclude that the racial animus of low-level supervisors influenced the decision maker. The court found that "it is not apparent that [the decision maker] went anywhere near the lengths required to investigate whether [plaintiff's] [disciplines] were justified apart from [the supervisors'] allegations."26 As a result, the employer in Hamzah will now have to expend substantial time and resources defending what probably seemed like a certain victory because it had not implemented the type of review process that could have prevented cat's paw liability.
Counsel would be well advised to recommend such review processes to their clients where feasible. Insulating significant adverse employment decisions from the potential undue influences of lower-level supervisors can be a significant tool in avoiding suit or successfully defending against such claims.
III. Successfully Defending Against Cat's Paw Claims
Of course, even the most carefully laid plans do not always protect against an enterprising plaintiff's attorney attempting to assert a cat's paw claim. In the event one is defending an employment discrimination claim and a cat's paw theory is asserted by plaintiff, there are several tools in the proverbial toolbox to defeat such claims.
A. What Type of Discrimination Claim Is Asserted?
While the Seventh Circuit has not had occasion to explicitly rule on whether the cat's paw theory applies under every possible discrimination law, it is likely that, in most situations, only those discrimination laws applying the lesser "motivating factor" test will be implicated for cat's paw treatment. In other words, absent an unusually strong influence by the supervisor, the underlying discrimination triggering potential cat's paw liability may rise to the level of a motivating factor but will typically not be a determinative factor in the employment decision. After all, the theory is that the decision maker is an unwitting dupe, unaware of any illegal animus underlying their decision. As a result, where the discrimination law in question requires that the illegal discrimination be a determinative factor in the employment decision, a strong argument can be made that the cat's paw theory should not be applied.27 This nuance is not always appreciated by plaintiffs drafting and filing complaints. This distinction can be an important tool in seeking dismissal of suits entirely or whittling down the scope of the claims asserted.28
B. Strategies for Defense
Defense counsel should carefully investigate the facts from the outset to determine whether cat's paw liability will be an issue. Having full knowledge of such facts from the beginning will lead to a better, more comprehensive defense and can lead to favorable settlements or other developments. There is nothing worse than believing one has an airtight defense because there is no evidence the decision maker bore any animus whatsoever towards the plaintiff, only to have the entire defense torpedoed because one low-level supervisor uttered a racial slur two months before the decision.
If cat's paw liability is likely to be an issue, counsel should purposefully develop the evidence to defend against it. First, counsel should insulate the decision maker from the supposed undue influence as much as possible and downplay any reliance or consideration of the supposedly tainted recommendation or underlying discipline. This may consist of developing evidence about the level of limited interaction between the decision maker and the supervisor, evidence showing past examples of the decision maker departing from recommendations of the supposedly tainted supervisor, emphasizing the influence of other untainted individuals on the process (such as human resources staff or the decision maker's superior), and the like.
In that same vein, counsel should develop the record as much as possible about every nuanced step the decision maker took in investigating the bases for the employment action and in reaching the ultimate decision. No amount of detail in this regard should be seen as overkill. The more detail presented to the fact finder about the decision maker's own investigation and independent judgment, the more likely that it will be found the illegal animus was not a proximate cause of the ultimate decision.
Defense counsel should be wary of plaintiffs who attempt to take the easy road in asserting cat's paw liability. Plaintiffs often attempt to establish cat's paw liability by merely offering evidence that suggests an illegal animus by their supervisor and then demonstrating that the supervisor recommended the adverse action or that the decision maker relied on prior discipline issued by that supervisor. However, under Staub, the burden for cat's paw liability is not supposed to be this low. While such an approach is the easiest road for plaintiffs to follow, it is not the legal standard. Rather, under Staub, the plaintiff must show that the underlying supervisor's act was actually motivated by the animus and that they intended their acts to cause the adverse employment action. Plaintiffs who have not developed sufficient evidence during discovery on these issues are prime candidates for dispositive motions in advance of trial.
The assertion of cat's paw liability by a plaintiff can turn the otherwise straightforward defense of an employment discrimination claim into a complex scheme of animus, intent, and the tainting of otherwise completely legitimate employment actions. To the extent employers are able to further insulate employment decisions from the possibility of the undue influences of a biased supervisor, such steps are highly recommended. If litigation occurs and a theory of cat's paw liability is asserted, a conscious, proactive approach to developing evidence which severs the causation between the biased supervisor and the ultimate employment decision will aid in a successful defense.
Aaron Graf is a litigator in the Milwaukee, Wisconsin office of Mallery & Zimmerman, S.C. He focuses his practice on labor and employment law and municipal law and is certified as a Professional in Human Resources (PHR). He routinely defends employers and municipalities throughout Wisconsin and proactively advises them on ways to avoid liability. Aaron was selected for inclusion as a Wisconsin Rising Star in 2014 and 2015 by Super Lawyers. He received his J.D. from Marquette University Law School in 2008 and his B.S. from Concordia University Wisconsin in 2004.
1 While cat's paw liability can be utilized in regards to any adverse employment action, for simplicity this Article will focus on termination decisions.
2 Staub v. Proctor Hosp., 560 F.3d 647, 650 (7th Cir. 2009), reversed and remanded, 562 U.S. 411 (2011).
4 It should be noted that some states, such as Wisconsin, equally apply the cat's paw theory of liability under their separate state employment discrimination laws. See, e.g., Tohl v. CUSA ES LLC, ERD Case No. CR200701939 (LIRC 11/21/13) (Wisconsin's Labor and Industry Review Commission applying the cat's paw theory to violations of the Wisconsin Fair Employment Act).
5 913 F.2d 398 (7th Cir. 1990).
6 Id. at 405.
7 479 F.3d 908 (7th Cir. 2007).
8 Id. at 918.
10 560 F.3d 647.
11 Id. at 651.
12 Id. at 654.
13 Id. at 652.
14 Id. at 659.
15 Staub v. Proctor Hosp., 562 U.S. 411 (2011).
16 Id. at 422.
17 While Staub addressed liability under USERRA, the Supreme Court specifically noted that "[USERRA] is very similar to Title VII." Id. at 417. Further, the Seventh Circuit has readily applied the Staub principles in the Title VII context. See, e.g., Matthews v. Waukesha Cnty., 759 F.3d 821, 828 (7th Cir. 2014).
18 803 F.3d 865 (7th Cir. 2015).
19 Id. at 870-872.
20 Id. at 871.
23 Thomas v. Berry Plastics Corp., 803 F.3d 510 (10th Cir. 2015).
24 Hamzah v. Woodman's Food Mkt., Inc., 2016 WL 297748 (W.D. Wis. Jan. 22, 2016) (unpublished decision). 25 Id. at **6-7.
27 See, e.g., Lindsey v. Walgreen Co., 615 F.3d 873, 876 (7th Cir. 2010) ("And even if Jenkins were a cat's paw, Lindsey could not prevail because the evidence established at most that her age was a motivating factor in Walgreens' decision to fire her. To establish liability under the ADEA, however, Lindsey had to show that her age was the determinative factor.") (emphasis added).
28 It should be cautioned that there is the possibility of individual liability for the malicious monkey for claims brought under 42 U.S.C. § 1981. See Smith v. Bray, 681 F.3d 888, 899 (7th Cir. 2012) ("It also makes sense as a matter of basic fairness: why should the 'hapless cat' (or at least his employer) get burned but not the malicious 'monkey'? The cat's paw theory can support individual liability under § 1981 for a subordinate employee who intentionally causes a decision-maker to take adverse action against another employee in retaliation for statutorily protected activity.").