Mardell v. Harleysville Life Ins. Co.

Opinions of the United

1994 Decisions States Court of Appeals

for the Third Circuit

8-1-1994

Mardell v. Harleysville Life Ins. Co.

Precedential or Non-Precedential:

Docket 91-0149

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UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

_____________________

No. 93-3258

_____________________

NANCY MARDELL,

Appellant

v.

HARLEYSVILLE LIFE INSURANCE COMPANY,

a Pennsylvania Corporation

____________________________________________________________

On Appeal From the United States District Court

for the Western District of Pennsylvania

(D.C. Civil No. 91-01493)

_____________________________________________________________

Argued: December 9, 1993

Before: BECKER, NYGAARD, Circuit Judges,

and YOHN, District Judge0

(Filed August 2, 1994)

JOEL S. SANSONE (Argued)

KELLY L. SCANLON

Sansone & Associates

220 Lawyers Building

428 Forbes Avenue

Pittsburgh, PA 15219

Attorneys for Appellant

ROSLYN M. LITMAN (Argued)

MARTHA S. HELMREICH

Litman Litman Harris Brown

and Watzman, P.C.

3600 One Oxford Centre

Pittsburgh, PA 15219

0

The Honorable William H. Yohn, Jr., United States District Judge

for the Eastern District of Pennsylvania, sitting by designation.

1

Attorneys for Appellee

JAMES R. NEELY, JR.

Deputy General Counsel

GWENDOLYN YOUNG REAMS

Associate General Counsel

LORRAINE C. DAVIS

Assistant General Counsel

BARBARA L. SLOAN (Argued)

Equal Employment Opportunity

Commission

Office of General Counsel

1801 L Street, NW

Washington, DC 20507

Attorneys for Amicus

Curiae in Support of

Appellant

________________________________________

OPINION OF THE COURT

________________________________________

BECKER, Circuit Judge.

Nancy Mardell appeals from the grant of summary

judgment for defendant Harleysville Life Insurance Company

("Harleysville") by the District Court for the Western District

of Pennsylvania in an employment discrimination suit alleging age

and gender discrimination. Mardell brought several claims

pursuant to Title VII of the Civil Rights Act of 1964 ("Title

VII"), 42 U.S.C.A. §§ 2000e to 2000e-17 (1981 & Supp. 1994), the

Age Discrimination in Employment Act ("ADEA"), 29 U.S.C.A. §§

621-34 (1985 & Supp. 1994), and the Pennsylvania Human Relations

Act, 43 PA. CONS. STAT. ANN. §§ 951-63 (1991 & Supp. 1994). The

district court relied upon the rule pioneered by the Tenth

2

Circuit Court of Appeals in Summers v. State Farm Mutual

Automobile Insurance Co., 864 F.2d 700 (10th Cir. 1988) to hold

that Harleysville's "after-acquired evidence" of Mardell's

alleged résumé fraud provided a complete defense to Mardell's

causes of action. "After-acquired evidence" in an employment

discrimination case denotes evidence of the employee's or

applicant's misconduct or dishonesty which the employer did not

know about at the time it acted adversely to the employee or

applicant, but which it discovered at some point prior to or,

more typically, during, subsequent legal proceedings; the

employer then tries to capitalize on that evidence to diminish or

preclude entirely its liability for otherwise unlawful employment

discrimination.

We reject the Summers rule in favor of one

circumscribing the use of after-acquired evidence to the remedies

phase of an employment discrimination suit brought pursuant to

Title VII or ADEA.0 We will therefore reverse the district

court's order granting summary judgment to Harleysville, and

0

Throughout the following discussion we will generally treat

claims arising under Title VII and ADEA similarly insofar as no

party has given us reason to distinguish between them for purpos-

es of the principal issue before us, and we have thought of no

reason for doing so ourselves. See, e.g., Trans World Airlines,

Inc. v. Thurston, 469 U.S. 111, 121, 105 S. Ct. 613, 621 (1985)

(applying Title VII precedent to ADEA because "the substantive

[(but not the procedural or remedial)] provisions of ADEA `were

derived in haec verba from Title VII'" (quoting Lorillard, Div.

of Loew's Theatres, Inc. v. Pons, 434 U.S. 575, 584, 98 S. Ct.

866, 872 (1978)); Armbruster v. Unisys Corp., No. 93-1333, Mem.

op. at 20 n.10 (July ??, 1994); Miller v. Cigna Corp., No. 93-

1773, 1994 WL 283269, at *4, *12 n.7 (June 28, 1994); Smithers v.

Bailar, 629 F.2d 892, 894-95 (3d Cir. 1980) (applying Title VII's

framework to an ADEA claim).

3

remand the case for further proceedings consistent with this

opinion.

I. FACTS AND PROCEDURAL HISTORY0

Harleysville hired Mardell as a Branch Life Manager in

February 1988 to manage insurance agents.0 Mardell appears from

the record to have been an accomplished life insurance agent. (A

57.) Before accepting the position with Harleysville, Mardell had

been employed by Prudential Life Insurance Company ("Prudential")

for eleven years. (A 58, 66, 68.) William Shelow, who was being

promoted out of the position at Harleysville for which Mardell

would be hired, had approached Mardell at Prudential about

replacing him in his soon-to-be vacated position. (A 69.)

Shelow was familiar with Mardell's work at Prudential and felt

that she would excel as a Life Manager for Harleysville. (A 70.)

In December 1989, Mardell became the first Harleysville

employee ever to be placed on probation. William Forloine,

0

For purposes of Harleysville's summary judgment motion, we view

the facts in the light most advantageous to Mardell, and resolve

all disputed issues of fact in her favor.

Inasmuch as some of the facts pertaining to Mardell's

prima facie case of discrimination and to the immateriality of

her misrepresentations are drawn from portions of Mardell's and

others' depositions that Mardell did not make part of the record

in the district court but submitted in her appendix to her brief

to this Court, we as a court of review may not consider them for

substantive purposes. See FED. R. APP. P. 10(a), 30(a); Jaconski

v. Avisun Corp., 359 F.2d 931, 936 & n.11 (3d Cir. 1966); Reed v.

Amax Coal Co., 971 F.2d 1295, 1299 n.3 (7th Cir. 1992). We

mention that testimony just as informative background to flesh

out the particulars of the dispute; we do not consider it on the

merits.

0

During Mardell's tenure the job title was reclassified as a

Regional Director.

4

Mardell's direct supervisor and Harleysville's senior vice-

president of marketing and sales, avowedly effected this action

for poor performance, even though at the time he imposed the

probation Mardell's work was improving and she had surpassed the

yearly goal he had set for her (A 76-78; SA 94, 99, 165-66). The

terms of probation required Mardell to meet or exceed her quota

every month at pain of dismissal, a requirement not imposed on

any of her male peers or supervisors and one which set a standard

that most of Harleysville's managers commonly failed to fulfill

(A 76-77, 80, 133-34; SA 166).

In February 1990, Harleysville discharged Mardell, who

then was 52 years old. (A 15, 59.) Four months later

Harleysville hired a 40 year old male to replace her. (A 131-

32.) Harleysville attributed its termination decision to

Mardell's poor work performance. Specifically, Harleysville

contends that during Mardell's tenure, sales declined in her

region, as did the number of independent insurance agents with

whom she maintained ongoing contact. The company also faulted

her for improperly implementing its new marketing plan, failing

to learn to use its new computer system effectively, making poor

presentations, and being unable to work suitably with some co-

workers and outside agents (SA 164-66).

Mardell disputes Harleysville's asserted reasons for

its decision to discharge her, contending instead that gender

and/or age discrimation was the cause. Mardell combined the

aforementioned circumstantial evidence of disparate treatment

(having been the only person placed on probation and subjected to

5

a quota, and having been replaced by a younger man) with direct

evidence of her supervisor's comments and attitudes indicative of

sex and/or age bias. She testified that Forloine had told her

that as a female he had higher expectations of her; that she

"wasn't one of the boys" and "couldn't be a good old boy;" that

he did not think her position "was a job for a woman;" and that

many of her agents would think of her "as a wife." She testified

further that once he had accused her, without foundation, of

missing work because she "just wanted to stay home and watch the

soaps," and that she had become aware of a meeting before all the

company's vice presidents and regional directors held after her

termination at which he allegedly stated that he "would never

have another female regional director." (A 71, 73-75.) She

added that he had frequently mentioned her age and that he had

told her once that she "should be home playing with [her]

grandchildren." (A 73.)

During discovery in the instant case, Harleysville

unearthed several instances of employment application and résumé

misrepresentation committed by Mardell. First, Mardell

represented that she had obtained a Bachelor of Science degree

from the University of Pittsburgh, whereas in fact the university

had never issued a diploma to her: the university's records

indicate that she has yet to complete all her work in two related

courses required for her degree. (A 82-84.) Mardell attributed

her misrepresentation to a mistaken belief that she had earned a

Bachelor of Science degree. She explained that she had belatedly

completed and submitted all required work for those two courses

6

and had been informed by her professor that he would file a grade

change report, but that for some unknown reason the university's

official records never credited the supposed report. (A 84, 96-

100.) Notably, Harleysville apparently did not consider the

possession of a college degree a prerequisite to employment as a

Branch Life Manager, and was prepared to hire the "mental

equivalent" of a college graduate. (A 123.)

Second, Harleysville learned that Mardell had also

misrepresented her professional experience on both her employment

application and résumé. Mardell had listed in the "employment

history" section of the application form and the "professional

experience" section of her résumé that she had served as a "writ-

er-interviewer" at a local hospital, as a therapist at a mental

health center, and as a manager and public relations director at

a hotel. (A 58.) Although Mardell had performed most of those

tasks as she described them on those documents (A 60-64, 67-68,

84-90, 104-05), in both documents she had (at a few points

greatly) exaggerated some of her specific duties (A 63, 67-68,

104; SA 131-32); misrepresented that the hospital and mental

health care center positions were remunerated (in fact she took

them on as unpaid field course work to earn college credit) (A

61-62, 85, 89-90); and misstated the dates she had performed

those activities (A 58, 90; SA 121, 145).

Buoyed by its admittedly post-termination discoveries,

Harleysville moved for summary judgment. It attached to its

motion affidavits by Glyn Mangum, the vice-president of sales who

had made the decision to hire Mardell, and Forloine. Mangum

7

averred that he had relied on Mardell's application and résumé

when considering her for the Branch Life Manager position and

that, had he known of her misrepresentations, he would not have

hired her. (SA 84-85, 87.) Forloine averred that he had

considered Mardell's alleged college degree to be a "plus" when

he interviewed her for the position; that, had he known of her

misrepresentations at the time of her interview, he would have

"strongly recommended that she not be hired;" and that, had he at

any time apprehended her misrepresentations, he would have,

consistent with Harleysville's policy as declared by the

employment application form Mardell had completed, "terminated

her immediately." He added that, in context of what Harleysville

now knows to be true about Mardell, it would not voluntarily

reemploy her (SA 95, 99).

Basing its summary judgment motion on the after-

acquired evidence doctrine, Harleysville assumed arguendo that it

had impermissibly discriminated against Mardell, but essentially

contested Mardell's standing to sue and, in the alternative,

questioned whether she had realized an injury (SA 61-71). On

April 27, 1993, the district court entered its Memorandum and

Order granting Harleysville's motion (A 5). In the process, it

applied a variant of the Summers rationale adapted to résumé

fraud cases and held that, because of her fraud in gaining her

employment, Mardell had suffered no legally cognizable injury

even if Harleysville had willfully discriminated against her on

the basis of her age and/or sex. Given that disposition, the

court did not reach the question whether Mardell had made out a

8

prima facie case of sex and/or age discrimination. This appeal

followed (A 5).0

II. THE RELEVANT LEGAL BACKGROUND

A. General Background

Experience with the federal employment discrimination

laws has culminated in the division of disparate treatment suits

into three classes: pure discrimination, pretext, and mixed-

motives cases.0 McDonnell Douglas Corp. v. Green, 411 U.S. 792,

93 S. Ct. 1817 (1973), as embellished by Texas Department of

Community Affairs v. Burdine, 450 U.S. 248, 101 S. Ct. 1089

(1981) and St. Mary's Honor Center v. Hicks, 113 S. Ct. 2742

(1993), establishes a flexible three-part model to allocate the

shifting burdens of production in the first two classes of

individual disparate treatment cases (pure discrimination and

pretext). Price Waterhouse v. Hopkins, 490 U.S. 228, 109 S. Ct.

0

We exercise plenary review over the district court's grant of

summary judgment, and employ the same standard applicable in the

district court. Davis v. Portline Transportes Maritime

Internacional, 16 F.3d 532, 536 (3d Cir. 1994). We affirm a

grant of summary judgment if "`there is no genuine issue as to

any material fact and . . . the moving party is entitled to

judgment as a matter of law.'" Id. at 536 n.3 (quoting FED. R.

CIV. P. 56(c)).

The facts of this case transpired before the effective

date of the Civil Rights Act of 1991 (the "1991 Act"), Pub. L.

No. 101-166, 105 Stat. 1075 (1991). Hence, the substantive and

remedial changes made by the 1991 Act do not apply to this case,

see Landgraf v. USI Film Prods., 114 S. Ct. 1483, 1505-06 (1994),

but occasionally we will make references to them and the

accompanying legislative history because that material is

generally informative.

0

For purposes of this opinion, we ignore the disparate impact

theory of employer liability.

9

1775 (1989) supplies the procedure for proving intentional

discrimination in mixed-motives cases. Numerous opinions of this

Court have explained the evidentiary regimes that the McDonnell

Douglas/Burdine/Hicks line of cases and Price Waterhouse have

established, but for the benefit of the untutored reader we

summarize them in the margin.0

0

In a case of failure to hire or promote, the plaintiff first

must carry the initial burden under the statute of

establishing a prima facie case of [unlawful]

discrimination. This may be done by showing (i) that he

belongs to a [protected category]; (ii) that he applied

and was qualified for a job for which the employer was

seeking applicants; (iii) that, despite his

qualifications, he was rejected; and (iv) that, after

his rejection, the position remained open and the

employer continued to seek applicants from persons of

complainant's qualifications.

McDonnell Douglas, 411 U.S. at 802, 93 S. Ct. at 1824. If the

plaintiff succeeds, the burden of production transfers to the

defendant to "articulate some legitimate, nondiscriminatory

reason for the employee's rejection." Id. In the unlikely event

that the employer at this juncture remains silent, the case falls

within the set of "pure discrimination" cases and "the court must

enter judgment for the plaintiff." Burdine, 450 U.S. at 254, 101

S. Ct. at 1094.

If the defendant does introduce into evidence a

legitimate reason for its actions, the case becomes a "pretext"

case. In that event the employer need not prove that the

tendered reason actually motivated its behavior, as throughout

this burden-shifting paradigm the ultimate burden of proving

intentional discrimination rests at all times with the plaintiff.

See id. at 253, 254, 256, 101 S. Ct. at 1093, 1094, 1095. Once

the employer answers its relatively light burden by articulating

a legitimate reason for the unfavorable employment decision, the

burden of production rebounds to the plaintiff, who must now show

by a preponderance of the evidence that the employer's explana-

tion is pretextual.

To accomplish this, the plaintiff must convince the

factfinder "both that the reason was false, and that

discrimination was the real reason." Hicks, 113 S. Ct. at 2752;

see id. at 2754 ("It is not

10

yenough . . . to disbelieve the employer; the factfinder must

believe the plaintiff's explanation of intentional discrimina-

tion." (emphasis in original)). In other words, since the

plaintiff's making out a prima facie case only shifts the burden

of production to the employer, the employer need only articulate

some legitimate reason for its action to meet the plaintiff's

serve. The factfinder's rejection of that proffered legitimate

reason permits, but does not compel, a verdict for the plaintiff.

See Hicks, 113 S. Ct. at 2749. To prevail, the plaintiff must

ultimately prove not that the illegitimate factor was the sole

reason for the decision, but that the illegitimate factor was a

determinative factor of the employment decision, that is, that

but for the protected characteristic, the plaintiff would have

been, for example, hired or promoted. See Hazen Paper Co. v.

Biggins, 113 S. Ct. 1701 (1993) (ADEA) (holding that "a disparate

treatment claim cannot succeed unless the employee's protected

trait actually played a role in [the decisionmaking] process and

had a determinative influence on the outcome").

In Price Waterhouse, the Supreme Court borrowed the

mixed-motives standard applied originally in a mixed-motives

constitutional tort case, Mt. Healthy City Sch. Dist. Bd. of

Educ. v. Doyle, 429 U.S. 274, 97 S. Ct. 568 (1977), and adapted

it for mixed-motives cases under Title VII. See Price

Waterhouse, 490 U.S. at 248-50, 109 S. Ct. at 1789-90 (plurali-

ty); id. at 258-59, 109 S. Ct. at 1795 (White, J., concurring);

cf. id. at 277-78, 109 S. Ct. at 1805 (O'Connor, J., concurring);

see also East Tex. Motor Freight Sys., Inc. v. Rodriguez, 431

U.S. 395, 404 n.9, 97 S. Ct. 1891, 1897 n.9 (1977); International

Bhd. of Teamsters v. United States, 431 U.S. 324, 369 n.53, 97 S.

Ct. 1843, 1872 n.53 (1977). A mixed-motives case is one in which

both legitimate and illegitimate factors contribute to the

employment decision. See Price Waterhouse, 490 U.S. at 232, 109

S. Ct. at 1781 (plurality). Such a case differs from a pretext

case in that the plaintiff must present evidence of illegal

discrimination "sufficiently strong to shift the burden of proof

to the employer," meaning that the plaintiff must adduce "direct

evidence" of discrimination (that is, more persuasive evidence

than the McDonnell Douglas/Burdine prima facie case). See

Armbruster v. Unisys Corp., No. 93-1333, Mem. op. at 22-23 (3d

Cir. July ??, 1994); Miller, No. 93-1773, 1994 WL 283269, at *12

n.6; Hook v. Ernst & Young, No. 92-3724, 1994 WL 283266, at *8-*9

(3d Cir. June 28, 1994); Price Waterhouse, 490 U.S. at 277-78,

109 S. Ct. at 1805 (O'Connor, J., concurring).

To rebut a plaintiff's case-in-chief in a mixed-motives

case (that is, once the plaintiff has met his or her burden of

proving an illegitimate factor "played a motivating [or

substantial] part in an employment decision"), the employer must

prove that "it would have made the same decision even if it had

not allowed [the illegitimate factor] to play such a role."

11

B. Other Circuits' Approaches to After-Acquired Evidence

The courts of appeals have grouped into two primary

(albeit splintered) camps regarding the relevancy of after-

acquired evidence of résumé and/or application fraud or employee

misconduct on the job.0

1. Courts Finding After-Acquired Evidence May Bar Liability

The Tenth Circuit formed the first camp with its

seminal Summers decision. Summers held that after-acquired

evidence, at least if material, bars all relief and hence

effectively operates as a complete defense to liability. Based

on after-acquired evidence of Summers' rampant on-the-job

misconduct,0 State Farm moved for summary judgment to diminish

Price Waterhouse, 490 U.S. at 244-45, 109 S. Ct. at 1787-88

(plurality); see id. at 242, 109 S. Ct. at 1786 (plurality). The

employer's rebuttal is thus an affirmative defense. See id. at

246, 109 S. Ct. at 1708 (plurality); id. at 259-60, 109 S. Ct. at

1795 (White, J., concurring); id. at 261, 109 S. Ct. at 1796

(O'Connor, J., concurring). We note, however, that to the extent

that Price Waterhouse barred all liability when the employer can

show it would have taken the same action even had it not had any

illegitimate motives, the 1991 Act overturned it. See Civil

Rights Act of 1991, Pub. L. No. 102-166, § 107, 105 Stat. 1075-76

(codified at 42 U.S.C.A. §§ 2000e-2(m), 2000e-5(g)(2)(B) (Supp.

1994)).

0

The Supreme Court has granted certiorari to resolve this split

during its next Term. See McKennon v. Nashville Banner

Publishing Co., 114 S. Ct. 2099 (1994). At the time we heard

oral argument, certiorari had not yet been granted in McKennon,

and the parties asked the panel (and it agreed) to decide the

case and not hold it in abeyance pending the probable grant of

certiorari so that the case can proceed to a timely resolution.

Cf. Milligan-Jensen v. Michigan Tech. Univ., 114 S. Ct. 22 (1993)

(dismissing the writ of certiorari in an after-acquired evidence

case).

0

Summers, a claims adjuster for the defendant insurance company,

had been reprimanded on several occasions for falsifying company

records and had eventually been placed on probationary suspension

12

the relief Summers could recover were he to prevail at the

liability phase of trial. See Summers, 864 F.2d at 702-03. The

Tenth Circuit held that the after-acquired evidence of Summers'

on-the-job misconduct would not only limit Summers' remedies,

but, by precluding Summers from any relief, the evidence would

effectively avert State Farm's liability.

The court understood that technically McDonnell Douglas

presupposed that a defendant could avert liability only with a

legitimate, nondiscriminatory motive known to the employer at the

instant of its actions. See id. at 705. Yet it reasoned --

apparently because State Farm would have fired him had it known

of his transgressions -- that "while . . . after-acquired

evidence cannot be said to have been a `cause' for Summers'

discharge in 1982, it is relevant to Summers' claim of `injury,'

and does itself preclude the grant of any present relief or

remedy to Summers." Id. at 708. The court likened the

plaintiff's situation to a "masquerading doctor," meaning one who

was not really a doctor but who had pretended to be one,

discharged for discriminatory reasons, who "would be entitled to

no relief." Id.

Since Summers, courts have allowed after-acquired

evidence to bar the employer's liability in two general catego-

for two weeks. About six months later, State Farm discharged

him, not because of his falsification of records "but because of

his poor attitude, inability to get along with fellow employees

and customers, and similar problems dealing with the public and

co-workers." Four years later, during discovery, State Farm

learned that on at least 150 occasions Summers had falsified

company records, eighteen instances of which falsifications

occurred after his return from suspended status.

13

ries of cases: résumé and/or application fraud cases, and

misconduct on the job cases. In a case of résumé or application

fraud, the employer typically asserts that, had it known of the

plaintiff's misrepresentation(s), it would never have hired him

or her. See Welch v. Liberty Machine Works, Inc., 23 F.3d 1403,

____ WL at *1, *3 (8th Cir. 1994) (brought under the Employee

Retirement Income Security Act, 29 U.S.C.A. §§ 1001-1461 (1985 &

Supp. 1994), and the Missouri Human Rights Act, MO. ANN. STAT. §§

213.010-.137 (Vernon 1986 & Supp. 1994)). The employer may

alternatively argue that, had it at any time after the hiring

found out about the misrepresentation(s), it would have promptly

fired the plaintiff.0 See O'Driscoll v. Hercules, Inc., 12 F.3d

176, 177-78 (10th Cir. 1994) (expanding the Summers holding from

misconduct to after-acquired résumé and application fraud cases),

petition for cert. filed, 62 U.S.L.W. 3757 (Apr. 1, 1994) (No.

93-1728); Reed v. Amax Coal Co., 971 F.2d 1295, 1298 (7th Cir.

1992) (per curiam). In some cases employers advance both

0

Some courts distinguish between "would not have hired" and

"would have fired" cases on the basis that an employer would be

more hesitant to fire a competent, capable employee than to not

hire the applicant in the first place. See, e.g., Washington v.

Lake County, Ill., 969 F.2d 250, 254, 255 n.5 (7th Cir. 1992).

In Washington, the Seventh Circuit held that in cases where the

employee actually was employed for some time, the "would not have

hired" inquiry is irrelevant because "the temporal focus is on

the time of the adverse employment decision." Id. at 256. As to

the "would have fired" inquiry, however, the court somewhat

inconsistently with its prior holding construed Price Waterhouse

to allow the employer to defend its actions with after-acquired

evidence, stating that in such situations "the employer must show

by a preponderance of the evidence that, if acting in a race-

neutral manner, it would have made the same employment decision

had it known of the after-acquired evidence." Id. at 255

(emphasis supplied).

14

arguments in the alternative. See Milligan-Jensen v. Michigan

Technological University, 975 F.2d 302, 304 n.2 (6th Cir. 1992),

cert. dismissed, 114 S. Ct. 22 (1993); Washington v. Lake County,

Ill., 969 F.2d 250, 253 (7th Cir. 1992); Johnson v. Honeywell

Information Systems, Inc., 955 F.2d 409, 414-15 (6th Cir. 1992);0

cf. Dotson v. United States Postal Service, 977 F.2d 976, 978

(6th Cir.) (per curiam) (holding that the plaintiff's employment

application misrepresentations rendered him unqualified for the

job without addressing whether the employer would not have hired

or would have fired him therefor), cert. denied, 113 S. Ct. 263

(1993). Obviously in job misconduct cases (like Summers), only a

variant of the latter "would have fired" argument can be made.

Cf. McKennon v. Nashville Banner Publishing Co., 9 F.3d 539, 542-

43 (6th Cir. 1993) (concluding that the plaintiff's job

misconduct precluded her "claim of injury" and that consequently

she was not entitled to "the grant of any relief or remedy"),

cert. granted, 114 S. Ct. 2099 (1994).

2. Courts Finding After-Acquired Evidence May Not Bar Liability

The opposing camp, exemplified by the Eleventh Circuit

in Wallace v. Dunn Construction Co., 968 F.2d 1174 (1992) when it

openly broke ranks with Summers,0 allows after-acquired evidence

0

Although Johnson involved a cause of action under Michigan's

Elliott-Larsen Civil Rights Act, MICH. COMP. LAWS §§ 37.2101-.2804,

the court construed it "in the same manner as its federal

counterpart." 955 F.2d at 415 n.1.

0

The first court of appeals after-acquired evidence case actually

rejecting Summers was handed down by the Seventh Circuit in Smith

v. General Scanning, Inc., 876 F.2d 1315 (1989), an ADEA suit. As

the employer brought out during discovery, the plaintiff had

15

to come in only at the remedies stage to slim down the relief

falsified his college credentials on his résumé. See id. at

1317. The district court had held that the plaintiff's

misrepresentation precluded the plaintiff from making out a prima

facie case because he could not show that he was qualified for

the position. The court of appeals, cognizant of the Summers

decision, rejected the district court's approach:

By narrowly focusing on [the plaintiff's] initial

burden, the district court was distracted from the real

issue in this case. At issue is the lawfulness of

Smith's termination. His resume fraud clearly had

nothing to do with that; it surfaced only after [the

plaintiff] was terminated and after this suit was com-

menced. Whether [the employer] discriminated against

[the plaintiff] must be decided solely with respect to

the reason given for his discharge . . . . His resume

fraud is, for this purpose, irrelevant.

Id. at 1319. The court noted in dicta that such evidence would

be relevant at the remedies stage, however, because "it would

hardly make sense to order [the plaintiff] reinstated to a job

which he lied to get and from which he properly could be

discharged for that lie." Id. at 1319 n.2.

But subsequent cases in the Seventh Circuit leave that

courts' approach the most unsettled, as panel after panel seems

at sea without seriously heeding what bearings have been set

before. See Gilty v. Village of Oak Park, 919 F.2d 1247, 1251

(7th Cir. 1990) (not referencing Smith but holding that evidence

of the plaintiff's fabrications exposed three years after the

adverse employment decision would bar all liability); Washington

v. Lake County, Ill., 969 F.2d 250, 253 & n.2 (7th Cir. 1992)

(same, but noting that the plaintiff had not challenged the

validity of the Summers rationale, and that he had not advanced

the argument that he should at least, in accordance with the

dicta in Smith, be accorded partial backpay); Reed, 971 F.2d at

1298 (approving Summers but giving it a restrained reading);

Kristufek v. Hussmann Foodservice Co., 985 F.2d 364, 369, 370

(7th Cir. 1993) (departing from the reasoning of Washington and

Reed without citing them, returning to Smith for the proposition

that "the only issue is the lawfulness of the termination for the

reasons given," and holding that "[a] discriminatory firing must

be decided solely with respect to the known circumstances leading

to the discharge"). Thus, while not exactly clear, the Seventh

Circuit, after bouncing back and forth between the two camps for

a while, seems now to have settled alongside Wallace. See

Kristufek, supra.

16

available to the plaintiff.0 The court, having had the benefit

of the Supreme Court's exposition in Price Waterhouse (applying

the Mt. Healthy framework to Title VII and clarifying the

question of timing in mixed-motives cases, see supra at Error!

Bookmark not defined. n.Error! Bookmark not defined.), criticized

the Summers decision for misapplying Mt. Healthy, "in that the

Summers rule ignores the lapse of time between the employment

decision and the discovery of a legitimate motive for that

decision." Id. at 1179-80. In doing so, the court continued,

"the Summers rule clashes with the Mt. Healthy principle . . .

that the plaintiff should be left in no worse a position than if

she had not been a member of a protected class or engaged in

protected opposition to an unlawful employment practice." Id. at

1179.

The Eleventh Circuit was also persuaded that the

Summers rule would result in underenforcement of the federal

anti-employment discrimination laws and accordingly underdeter

unlawful employment discrimination. See id. at 1179-80. Having

resolved that after-acquired evidence does not preclude

liability, the court concluded with a detailed exposition on the

0

In Wallace, the plaintiff (Neil) had filed numerous causes of

action against the employer under the Equal Pay Act and Title VII

for wrongful discharge. During her deposition, Neil admitted

having falsified her employment application by omitting a

conviction on drug charges. Soon thereafter, the employer Dunn

filed a motion for summary judgment, partially grounded in the

Summers defense. See id., 968 F.2d at 1176-77.

17

availability of the standard remedies in after-acquired evidence

cases.0

III. OUR APPROACH

A. The Liability Stage

1. After-Acquired Evidence Is Irrelevant at the Liability Stage

A quick review of the overarching framework erected for

employment discrimination claims, see supra at Error! Bookmark

not defined. n.Error! Bookmark not defined., discloses why after-

acquired evidence cannot be a defense to liability. What sets an

after-acquired evidence case far apart from a mixed-motives case

0

With respect to reinstatement and front pay, the court held that

those remedies would be inappropriate if the after-acquired

evidence would have in and of itself led to the adverse

employment action. See id. at 1181-82. An injunction against an

employer's unlawful practices, it added, would not be available

if the court did not also order the plaintiff reinstated. See

id. at 1182. The court also determined, however, that after-

acquired evidence would not affect the availability of declarato-

ry relief. See id.

According to the court, backpay should be awarded up

until the date of judgment, unless the employer can prove that

"it would have discovered the after-acquired evidence prior to

what would otherwise be the end of the backpay period in the

absence of the allegedly unlawful acts and this litigation." Id.

This division, the court explained, would fairly balance the

employer's right to make lawful employment decisions and the

employee's right to make-whole relief. Ending the backpay period

when the employer actually discovered the evidence would not make

the victim whole, the court maintained, insofar as absent the

unlawful conduct and the resulting litigation, the employer would

very likely not have detected the fraud or misconduct. See id.

Finally, with regard to the award of attorneys' fees,

the court held that if the employee obtained "some benefit" from

the lawsuit or if the litigation "materially altered" the

parties' legal relationship, she would as a "prevailing party" be

entitled to partial attorneys' fees; the after-acquired evidence

could diminish the award by an amount arrived at using

"traditional attorney fee principles." See id. at 1182-83.

18

like Price Waterhouse or a pretext case like McDonnell Douglas is

that the articulated "legitimate" reason, which was non-existent

at the time of the adverse decision, could not possibly have

motivated the employer to the slightest degree. After-acquired

evidence, simply put, is not relevant in establishing liability

under Title VII or ADEA because the sole question to be answered

at that stage is whether the employer discriminated against the

employee on the basis of an impermissible factor at the instant

of the adverse employment action. See Wallace, 968 F.2d at 1179

(pointing out that "the Summers rule ignores the lapse of time

between the employment decision and the discovery of a legitimate

motive for that decision").

The Supreme Court in Price Waterhouse held that in a

mixed-motives case the employer could rely only on a legitimate

motive it held at the time of the adverse employment decision.

See 490 U.S. at 252, 109 S. Ct. at 1791 (plurality) ("An employer

may not . . . prevail in a mixed-motives case by offering a

legitimate and sufficient reason for its decision if that reason

did not motivate it at the time of the decision." (emphasis

supplied)); id. at 250, 109 S. Ct. at 1790 (plurality) (requiring

the employer's legitimate, sufficient reason to have motivated

the employer "at the moment of the decision"); id. at 241, 109 S.

Ct. at 1785 (plurality) ("The critical inquiry . . . is whether

[a protected characteristic] was a factor in the employment

decision at the moment it was made." (emphasis in original)); id.

at 259, 109 S. Ct. at 1795 (White, J., concurring) (stating that

the employee must "show that the unlawful motive was a

19

substantial factor in the adverse employment action" (emphasis in

original)); id. at 266-67, 109 S. Ct. at 1799 (O'Connor, J.,

concurring) (stating that the employer must show that "despite

consideration of illegitimate factors the individual plaintiff

would not have been hired or promoted in any event").

Thus, under the mixed-motives analysis, the employer in

an after-acquired evidence case cannot contend that it would have

reached the same decision at the time it was made absent the

illicit motive. Concomitantly, under the pretext analysis, it

should be simple for the employee to demonstrate beyond

peradventure that the proffered legitimate (but after-acquired)

reason was not the true cause for the decision but is merely a

"pretext." See, e.g., Eastland v. Tennessee Valley Auth., 704

F.2d 613, 626 (11th Cir. 1983) (holding that the employer's

proffered non-discriminatory reason was pretextual because the

employer was unaware of the proffered reason at the time it made

its decision), cert. denied, 465 U.S. 1066, 104 S. Ct. 1415

(1984); cf. McDonnell Douglas, 411 U.S. at 802, 805, 93 S. Ct. at

1824, 1826 (assuming that the employer was aware of the proffered

reason at the time of the decision). Although Summers reasoned

not that the after-acquired evidence would avoid liability but

instead that it would bar all remedies, the effect is the same,

and therefore the Summers rationale entirely eviscerates the

temporal holding in Price Waterhouse that an employer can rely on

a non-discriminatory justification for its action only if that

justification actually motivated it at the time of its decision.

20

Having undermined the defendant's articulated

legitimate explanation, under the standard employment

discrimination burden-shifting scheme it would now be up to the

factfinder to determine if the plaintiff met his or her burden of

proving intentional discrimination. By removing this basic issue

from the factfinder, courts applying the after-acquired evidence

doctrine depart from the settled framework. Problematically,

courts that allow after-acquired evidence to bar liability allow

employers to make plaintiffs worse off for having a protected

characteristic. That is because presumably, absent the wrong

done the employee, the employer would not have discovered the

"legitimate motive" evidence (at least during the relevant time

frame) and the employee would still be employed. See Wallace,

968 F.2d at 1179 (observing that the Summers rule "excuses all

liability based on what hypothetically would have occurred absent

the alleged discriminatory motive assuming the employer had

knowledge that it would not acquire until sometime during the

litigation arising from the discharge" (some emphasis omitted)).

To assure that the plaintiff is restored to the

position he or she would have occupied absent the employer's

unlawful discrimination, when the employer's motive was

exclusively discriminatory at the time of the decision (as is

assumed arguendo in the Summers-type cases), a legitimate reason

for the decision brought out later must not be used nunc pro tunc

by the employer to justify its actions. See Welch, 23 F.3d at

____ WL at *4 (Arnold, J., dissenting) ("I think that the objects

of deterrence and compensation both require us to examine a

21

defendant's mind for what it contained, not what it might have

contained, to determine whether he has committed a wrong."). An

employer's (assumed) discrimination is a deplorable wrong, and

the fact that the employer might have accomplished a like result

without maltreating the employee by employing different,

nonharmful means (from the point of view of federal law) -- that

is, by relying on legitimate instead of discriminatory reasons --

is beside the point, since if only it had used the other,

defensible means there would have been no injury and no cause for

the lawsuit.

2. Victims of Invidious Employment Discrimination Have Standing

Some members of the no-liability camp advance the

rationale that the plaintiff lacks standing because he or she was

not qualified for the position (qualification being an element of

the plaintiff's McDonnell Douglas prima facie case), an argument

pertaining to the employer's de jure, as opposed to Summer's de

facto, non-liability. See Dotson, 977 F.2d at 977-78; Gilty v.

Village of Oak Park, 919 F.2d 1247, 1251 (7th Cir. 1990).0 That

argument, however, is at odds with Supreme Court precedent.

0

Cf. Williams v. Boorstin, 663 F.2d 109, 115-18 (D.C. Cir. 1980)

(reaching the same conclusion as Dotson and Gilty that the

plaintiff could not establish a prima facie case because he was

unqualified, but there the employer had discovered the employee

"lawyer" lacked a law degree before discharging him), cert.

denied, 451 U.S. 985, 101 S. Ct. 2319 (1981); Mantolete v.

Bolger, 767 F.2d 1416, 1423 (9th Cir. 1985) (holding that the

district court did not abuse its discretion in allowing the

defendant to introduce after-acquired evidence to rebut the

plaintiff's prima facie case of qualification, but cautioning

that it would be improper for the employer to use such evidence

to justify its decision).

22

The plaintiff's McDonnell Douglas prima facie case was

formulated to identify circumstances under which the

discriminatory motive or intent of the employer may be inferred.

See Hicks, 113 S. Ct. at 2747 (describing that the plaintiff's

prima facie case gives rise to a presumption of discriminatory

intent, which the defendant must rebut with evidence of a

legitimate reason); Burdine, 450 U.S. at 253-54, 101 S. Ct. at

1094 (explaining that the plaintiff's prima facie case must "give

rise to an inference of unlawful discrimination"); Furnco Constr.

Corp. v. Waters, 438 U.S. 567, 576-77, 98 S. Ct. 2943, 2949-50

(1978) ("A prima facie case under McDonnell Douglas raises an

inference of discrimination only because we presume these acts,

if otherwise unexplained, are more likely than not based on the

consideration of impermissible factors."); Teamsters, 431 U.S. at

358, 97 S. Ct. at 1866. This reading is substantiated by the

fact that the pliant McDonnell Douglas prima facie case is only

one of many alternative routes available for a plaintiff to

travel, amongst which is direct evidence bearing on discrimi-

natory intent. See, e.g., United States Postal Serv. v. Aikens,

460 U.S. 711, 715, 103 S. Ct. 1478, 1482 (1978).0 Consequently,

what is relevant to the inquiry is the employer's subjective

assessment of the plaintiff's qualifications, not the plaintiff's

objective ones if unknown to the employer.0 In other words, the

0

Even were the Dotson and Gilty "no standing" rationale

persuasive in McDonnell Douglas type cases, it could not help the

employer in cases (such as this one) where the plaintiff adduces

direct evidence of disparate treatment.

0

Many courts construing Title VII or ADEA have so held. See,

e.g., Kristufek v. Hussmann Foodservice Co., 985 F.2d 364, 369

23

strength of the inference of discrimination based on the prima

facie case is independent of the plaintiff's qualifications that

were unknown to the employer.

The no-standing argument additionally runs counter to

the plain meaning of Title VII and ADEA. Those statutes grant

standing to "any individual" discriminated against by a covered

employer. See 42 U.S.C.A. § 2000e-2(a) (1981); 29 U.S.C.A. §

(7th Cir. 1993); Wallace, 968 F.2d at 1179; Smith v. General

Scanning, Inc., 876 F.2d 1315, 1319 (1989); Sabree v. United Bhd.

of Carpenters & Joiners Local No. 33, 921 F.2d 396, 402 (1st Cir.

1990); Norris v. City & County of San Francisco, 900 F.2d 1326,

1331 (9th Cir. 1990); Hill v. Seaboard C. L. R.R. Co., 767 F.2d

771, 774 (11th Cir. 1985), aff'd on reh'g, 885 F.2d 804 (11th

Cir. 1989); Cuddy v. Carmen, 762 F.2d 119, 127 & n.12 (D.C.

Cir.), cert. denied, 474 U.S. 1034, 106 S. Ct. 597 (1985);

Eastland v. Tennessee Valley Auth., 704 F.2d 613, 626 (11th Cir.

1983), cert. denied, 465 U.S. 1066, 104 S. Ct. 1415 (1984); Lee

v. National Can Corp., 699 F.2d 932, 937 (7th Cir.), cert.

denied, 464 U.S. 845, 104 S. Ct. 148 (1983); cf. Price Water-

house, 490 U.S. at 252, 109 S. Ct. at 1791; Teamsters, 431 U.S.

at 369 n.53, 97 S. Ct. at 1872 n.53 (illustrating that an

employer may rebut a plaintiff's prima facie case by showing that

"the nonapplicant's stated qualifications were insufficient"

(emphasis supplied)); see also Regents of University of Cal. v.

Bakke, 438 U.S. 265, 320 n.54, 98 S. Ct. 2733, 2764 n.54 (1978)

("Having injured respondent solely on the basis of an unlawful

classification, petitioner cannot now hypothesize that it might

have employed lawful means of achieving the same result.").

This temporal knowledge limitation distinguishes a

statutory unlawful discrimination claim from a contractual

wrongful termination claim. In contract actions, if one party

commits a material breach, the other party may generally use it

to justify nonperformance even if, at the time of its own

nonperformance, the second party was unaware of the first party's

material breach. See College Point Boat Corp. v. United States,

267 U.S. 12, 15-16, 45 S. Ct. 199, 200-01 (1925); REST.2D CONTRACTS

§ 385 cmt. a (1981); id. § 225 & cmt. e; id. § 237 & cmt. c; cf.

id. § 164 (fraudulent inducement makes a contract voidable). In

a contract claim, questions like unidentified misrepresentations

and the signing of an attestation clause are accordingly

important. But in our view it is specious to conflate the two

very different causes of action.

24

623(a) (1985). The result is no different if one focuses on the

definition of "employee" rather than "individual," since both

statutes define an "employee" as "an individual employed by an

employer." 42 U.S.C.A. § 2000e(f) (1981); 29 U.S.C.A. § 630(f)

(1985). The point is that neither definition contains an

exception for individuals who would not have been employed by the

employer but for their fraud or misconduct, or for employees who

measured against some objectively defined criteria are "unquali-

fied." Congress having granted standing in the circumstances we

consider here, the matter is settled. See Kenneth G. Parker,

Note, After-Acquired Evidence in Employment Discrimination Cases:

A State of Disarray, 72 TEX. L. REV. 403, 428 (1993) ("Simply put,

the ability of the plaintiff to sue is delineated by the statute

itself, and [the] remedy should be determined with reference to

the dual purposes of making the plaintiff whole and deterring a

discriminating employer.").

3. Victims of Invidious Employment Discrimination

Suffer Real and Legal Injury

Summers understood that "McDonnell Douglas clearly

presupposes a `legitimate, nondiscriminatory reason' known to the

employer at the time of the employee's discharge." 864 F.2d at

705 (emphasis in original). Summers reached its conclusion that

the employer would not be liable for the different, practical (as

opposed to legal) reason that, the plaintiff not having been

"injured," he or she could obtain no relief. We disagree.

25

Reasoning that the plaintiff suffered no legal injury

from invidious discrimination when after-acquired evidence

reveals résumé fraud or work misconduct, see Summers, 864 F.2d at

708 (assuming that the employer's decision was motivated by an

illegitimate reason); McKennon, 9 F.3d at 541, 542 (same);

Milligan-Jensen, 975 F.2d at 305 (same); Washington, 969 F.2d at

255, 256-57 (same); Johnson, 955 F.2d at 415 (same), defies

common sense. Imagine, for instance, an employer which

intentionally batters an employee who procured his or her

position through fraud or who falsified company records. The

Summers rationale would bar the employee's recovery in an

appropriate action because the employee had no "right" to be

where he or she was at the moment of his or her injury. Surely

that result flies in the face of reason and the whole body of

tort law.0 Accord Welch, 23 F.3d at WL at *4 (Arnold, J.,

dissenting).

0

In Baab v. AMR Servs. Corp., 811 F. Supp. 1246 (N.D. Ohio 1993),

the court concluded in context of an intentional-infliction of

emotional distress claim tacked on to an employment discrimina-

tion suit that

one could take the view that plaintiff should not

complain of injury inflicted upon her at her workplace

when, had the defendant been apprised of her

wrongdoing, she would not have been there in the first

place. This argument . . . misses the mark. The

injury complained of here is injury to one's person and

plaintiff is entitled to be free of that injury

regardless of her status as a dischargeable employee.

Id. at 1262. But cf. Russell v. Microdyne Corp., 830 F. Supp.

305, 306-08 (E.D. Va. 1993) (supplanting the Summers rationale to

sexual harassment situations); Churchman v. Pinkerton's Inc., 756

F. Supp. 515, 518-21 (D. Kan. 1991) (same); Mathis v. Boeing

26

The rationale might have a stronger bite to it were the

only injury to the victim the adverse employment action per se;0

but, quite to the contrary, in an employment discrimination suit

the traumatic injury is having been subjected to the adverse

employment action because of one's race, sex, age, or other

protected characteristic, that is, having been unlawfully

discriminated against. Put more dramatically, to maintain that a

victim of employment discrimination has suffered no injury is to

deprecate the federal right transgressed and to heap insult ("You

Military Airplane Co., 719 F. Supp. 991, 994-95 (D. Kan. 1989)

(same).

Indeed, even one whom the defendant knows to be a

wrongdoer at the time of the defendant's actions is not too

unworthy in the eyes of the law to recover for an unprivileged

intentional or even a negligent tort. See REST.2D TORTS § 889 &

cmts. a, b (1979) ("One is not barred from recovery for an

interference with his legally protected interests merely because

at the time of the interference he was committing a tort or a

crime . . . ."); id. § 890 (discussing privileges); cf. id. § 870

& cmt. e (1979) ("One who intentionally causes injury to another

is subject to liability to the other for that injury, if his

conduct is generally culpable and not [privileged].").

Certainly, the defendant who does not know that the

victim is a wrongdoer at the time the tort is committed has no

privilege to inflict the harm. And it would seem that if one has

no privilege --because there is missing some provocation or

circumstance establishing the privileges of self-defense, defense

of property, or defense of others -- to injure a known trespasser

deliberately, a fortiori one has no such privilege with respect

to someone invited onto the premises, albeit the invitation be

procured through trick.

0

Although even were that the case an argument can be made that

the plaintiff was still legally injured since, absent the

discrimination, he or she would still have been employed and the

employer presumably would not have exposed the fraud or

misconduct for some unknown span of time. See Massey v. Trump's

Castle Hotel & Casino, 828 F. Supp. 314, 322 (D.N.J. 1993)

("Absent those illegal motives, the employee would still be

employed. Thus, an illegal discharge causes an injury regardless

of an employee's previous misconduct, and that injury must be

subject to some redress.").

27

had it coming") upon injury. Cf. Richard Granofsky & Jay S.

Becker, After-Acquired Evidence in Employment Discrimination

Cases, 36 DEF. 19, 24 (1994) (referring to such employees as

"unworthy"). A victim of discrimination suffers a dehumanizing

injury as real as, and often of far more severe and lasting harm

than, a blow to the jaw.0 See H.R. REP. No. 40(I), 102d Cong.,

1st Sess. 15 (1991), reprinted in 1991 U.S.C.C.A.N. 549, 553

("The Committee intends to confirm that the principle of anti-

discrimination is as important as the principle that prohibits

assaults, batteries and other intentional injuries to people.").

In the 1991 Act, Congress understood as much and

changed the result reached in Price Waterhouse: in cases decided

0

See United States v. Burke, 112 S. Ct. 1867, 1872 (1992) ("It is

beyond question that discrimination in employment on the basis of

sex, race, or any of the other classifications protected by Title

VII is, as . . . this Court consistently has held, an invidious

practice that causes grave harm to its victims."); H.R. REP. No.

40(I), 102d Cong., 1st Sess. 14 (1991) ("Victims of intentional

discrimination often endure terrible humiliation, pain and

suffering while on the job. This distress often manifests itself

in emotional disorders and medical problems."), reprinted in 1991

U.S.C.C.A.N. 549, 552; id. at 66-69 (documenting the disastrous

effects of invidious discrimination on its victims), reprinted in

1991 U.S.C.C.A.N. at 604-07; Pauline Yoo, Note, The After-

Acquired Evidence Doctrine, 25 COLUM. HUM. RTS. L. REV. 219, 252 &

n.201 (1993) ("Discrimination can damage a victim emotionally,

psychologically, or physically."); id. at 243 & n.150 (same);

Cheryl K. Zemelman, Note, The After-Acquired Evidence Defense to

Employment Discrimination Claims: The Privatization of Title VII

and the Contours of Social Responsibility, 46 STAN. L. REV. 175,

199-200 (1993) [hereinafter Zemelman, The After-Acquired Evidence

Defense]; see also Civil Rights Act of 1991, Pub. L. No. 102-166,

§ 107(b), 105 Stat. 1075-76 (codified at 42 U.S.C.A. § 2000e-

5(g)(2)(B) (Supp. 1994)) (allowing a court to grant a victim in a

mixed-motives case declaratory and injunctive relief and to award

him or her attorneys' fees and costs even if the employer had a

legitimate, sufficient motive when it acted).

28

under the 1991 Act, the plaintiff is entitled to some relief even

if the employer actually would have taken the same action at the

same time absent any invidious motive. See Civil Rights Act of

1991, Pub. L. No. 102-166, § 107, 105 Stat. 1075-76 (codified at

42 U.S.C.A. §§ 2000e-2(m), 2000e-5(g)(2)(B) (Supp. 1994)).

Moreover, we think it clear that, where a federal right

has been violated, federal courts must provide a remedy. The

right which is violated by an employer which discriminates on the

basis of a protected characteristic is not the employee's right

to the job, but the employee's right to equal, fair, and

impartial treatment, the violation of which frequently results,

inter alia, in a significant injury to the victim's dignity and a

demoralizing impairment of his or her self-esteem. See supra at

Error! Bookmark not defined. n.Error! Bookmark not defined.; cf.

H.R. REP. No. 40(I) at 64-65, reprinted in 1991 U.S.C.C.A.N. at

602-03; Brown v. Board of Educ., 347 U.S. 483, 494, 74 S. Ct.

686, 691-92 (1954); see also Civil Rights Act of 1991, Pub. L.

No. 102-166, § 102, 105 Stat. 1072-73 (codified at 42 U.S.C.A. §

1981a(b)(3) (Supp. 1994)) (providing a plaintiff may recover

compensatory damages under Title VII for "emotional pain,

suffering, inconvenience, mental anguish, loss of enjoyment of

life, and other nonpecuniary losses"). The plaintiff's deceit or

misconduct toward the employer is most appropriately considered

in the remedies stage, or in any claim compatible with the

federal anti-discrimination laws that the employer may properly

assert against the employee under appropriate state or federal

law. See Massey, 828 F. Supp. at 323 ("[I]f the employer has

29

somehow been damaged by the plaintiff's misrepresentations or

misconduct on the job, it may seek its own damages where

appropriate.").

The Summers rationale confuses the question whether the

employer injuriously discriminated against the employee with the

question whether the employee had an entitlement to the job.

Whether the employee had some "right" to the job in question is

not an issue in a Title VII or ADEA action; the issue is whether

the employer discriminated based on an impermissible factor.

Besides receiving no mention in the statutes, the "property

right" inquiry is irrelevant for the simple reason that both

Title VII and ADEA operate against the presumed backdrop of at-

will employment, meaning that the employee is presumptively not

entitled to the job, irrespective of résumé fraud or performance

misconduct. Under the traditional employment-at-will doctrine,

an employer may discipline or terminate an employee for any

reason or no reason.0 Thus, if entitlement to the job were a

0

See, e.g., Poff v. Western Nat'l Mut. Ins. Co., 13 F.3d 1189,

1191 (8th Cir. 1994) (Minnesota law); Richards v. General Motors

Corp., 991 F.2d 1227, 1234-35 (6th Cir. 1993) (Michigan law);

Hall v. Western Prod. Co., 988 F.2d 1050, 1058-59 (10th Cir.

1993) (Wyoming law); Carlson v. Arnot-Ogden Memorial Hosp., 918

F.2d 411, 414 (3d Cir. 1990) (Pennsylvania law).

While the federal anti-employment discrimination laws

were not designed to impinge directly upon employer free choice,

indirect effects are inevitable. No doubt the federal employment

discrimination laws have curtailed the more excessive aspects of

the employment-at-will doctrine with respect to protected

persons. Now, a covered employer who arbitrarily and

capriciously terminates a protected person without any animus

toward the protected characteristic runs a not insubstantial risk

of liability. For example, the Supreme Court has intimated that

an arbitrary and capricious rationale may not meet the employer's

burden of rebutting a plaintiff's prima facie case of

30

prerequisite to liability or recovery, then no at-will employee

could recover under Title VII or ADEA -- but that plainly is not

the case. See Washington, 969 F.2d at 256 ("A `property right' in

one's job . . . is not a requirement in a federal discrimination

claim.").

What is the case is that neither Title VII nor ADEA

strips a wrongdoing employee of his or her entitlement to

protection against unlawful discrimination. Instead of focusing

on the worthiness of the victim, the statutes exclusively and

unambiguously fix on the employer's motives. See Alexander v.

Gardner-Denver Co., 415 U.S. 36, 51, 94 S. Ct. 1011, 1021 (1974)

("Title VII's strictures are absolute and represent a congres-

sional command that each employee be free of discrimination."

(emphasis supplied)); Massey, 828 F. Supp. at 323 ("There is

nothing in [Title VII] itself to support a requirement that the

job had been acquired honestly."). An employee's fraud or

misconduct, while bearing on his or her fitness for the job,

simply does not justify, excuse, or make harmless the employer's

intentional, invidious discrimination. Because the Summers

approach ignores these precepts, thereby denying remedial justice

for a grievous injury, we reject that approach.

discrimination. See Burdine, 450 U.S. at 255, 101 S. Ct. at 1094

("The [legitimate] explanation [the defendant] provided must be

legally sufficient to justify a judgment for the defendant.");

McDonnell Douglas, 411 U.S. at 802-03, 93 S. Ct. at 1824 ("We

need not attempt in the instant case to detail every matter which

fairly could be recognized as a reasonable basis for a refusal to

hire."). Nevertheless, the employment-at-will doctrine has been

abridged only to the extent necessary to enforce the federal

employment discrimination laws.

31

4. Summers Ignores the Compelling Public Interest in Enforcement

Besides slighting the very real injury suffered by a

victim of employment discrimination, the Summers rule disregards

that an act of employment discrimination is much more than an

ordinary font of tort law. The anti-employment discrimination

laws are suffused with a public aura for reasons that are well

known. Throughout this Nation's history, persons have far too

often been judged not by their individual merit, but by the

fortuity of their race, the color of their skin, the sex or year

of their birth, the nation of their origin, or the religion of

their conscientious choosing. Congress has responded to these

pernicious misconceptions and ignoble hatreds with humanitarian

laws formulated to wipe out the iniquity of discrimination in

employment, not merely to recompense the individuals so harmed

but principally to deter future violations.

The anti-employment discrimination laws Congress

enacted consequently resonate with a forceful public policy

vilifying discrimination.0 A plaintiff in an employment-

0

See, e.g., Aikens, 460 U.S. at 716, 103 S. Ct. at 1482 ("The

prohibitions against discrimination contained in the Civil Rights

Act of 1964 reflect an important national policy."); Franks v.

Bowman Transp. Co., 424 U.S. 747, 778 n.40, 96 S. Ct. 1251, 1271

n.40 (1976) (stating that "claims under Title VII involve the

vindication of a major public interest" (internal quotations

omitted)); id. at 763, 96 S. Ct. at 1263 ("[Congress] ordained

that its policy of outlawing [discrimination on the basis of

race, religion, sex, or national origin] should have the `highest

priority' . . . ."); Alexander, 415 U.S. at 45, 94 S. Ct. at 1018

("[T]he private litigant not only redresses his own injury but

also vindicates the important congressional policy against

discriminatory employment practices."); cf. Newman v. Piggie Park

32

discrimination case accordingly acts not only to vindicate his or

her personal interests in being made whole, but also as a

"private attorney general" to enforce the paramount public

interest in eradicating invidious discrimination.0

In sum, it appears that the employee's misconduct or

fraud is a possible wrong against the employer, whereas the

employer's discrimination is a wrong against the employee and

society at large. See Massey, 828 F. Supp. at 323 ("Any concern

Enters., 390 U.S. 400, 402, 88 S. Ct. 964, 966 (1968) (per

curiam) (decided under Title II of the Civil Rights Act of 1964)

(stating that Congress intended the struggle against discrimina-

tion to be a policy "of the highest priority").

0

See EEOC v. Associated Dry Goods Corp., 449 U.S. 590, 602, 101

S. Ct. 817, 824 (1981) ("Congress considered the charging party a

`private attorney general,' whose role in enforcing the ban on

discrimination is parallel to that of the [Equal Employment

Opportunity] Commission itself." (citing Christiansburg Garment

Co. v. EEOC, 434 U.S. 412, 421, 98 S. Ct. 694, 700 (1978)); New

York Gaslight Club, Inc. v. Carey, 447 U.S. 54, 63, 100 S. Ct.

2024, 2030-31 (1980); Albemarle Paper Co. v. Moody 422 U.S. 405,

415, 95 S. Ct. 2362, 2370 (1975); Alexander, 415 U.S. at 45, 94

S. Ct. at 1018; see also Newman, 390 U.S. at 401-02, 88 S. Ct. at

966 (decided under Title II of the Civil Rights Act of 1964).

In the Civil Rights Act of 1991, by authorizing a court

to grant a victim of discrimination in a mixed-motives case

declaratory and injunctive relief and partial attorneys' fees and

costs, Congress again recognized the public interest in

eradicating discrimination even when the employer had acted at

the time of its decision for a legitimate reason that would have

propelled it to take the same actions standing alone. See Civil

Rights Act of 1991, Pub. L. No. 102-166, §107(b), 105 Stat. 1075-

76 (codified at 42 U.S.C.A. § 2000e-5(g)(2)(B) (Supp. 1994)).

That is, the 1991 Act reinforces the common sense notion that,

even if the plaintiff is entitled to no personal relief, at least

the remedies inuring to the public's benefit -- a declaratory

judgment, injunctive relief, and, derivatively, attorneys' fees,

see supra (discussing the litigant's role as a private attorney

general) -- should be considered in an after-acquired evidence

case. Since those remedies do not economically benefit the

plaintiff, that provision evidences a strong public policy in

favor of enforcement of the anti-employment discrimination laws.

33

we may have in awarding damages to employees who have acquired

their jobs improperly does not outweigh the plaintiff's statutory

right to recover . . . ."). The Summers approach unjustifiably

exalts the employer's purely private state right above the

employee's quasi-public federal one.

5. Non-Liability Undermines the Statutes' Purposes

As described supra Part 31, Congress prescribed a

strong medicine, the anti-employment discrimination laws, to cure

the social malady of invidious discrimination. Deterrence is

accomplished by placing an economic price on discriminatory acts,

and by exposing and stigmatizing the wrongdoer's acts before the

entire community. We also bear in mind that, as remedial

statutes, Title VII and ADEA should be liberally construed to

advance their beneficent purposes.0 Unfortunately, the Summers

approach disregards that canon of construction and frustrates the

paramount objective of Title VII and ADEA, to deter violations of

0

See, e.g., Hart v. J. T. Baker Chem. Co., 598 F.2d 829, 831 (3d

Cir. 1979) (Title VII); Oscar Mayer & Co. v. Evans, 441 U.S. 750,

765-66, 99 S. Ct. 2066, 2076 (1979) (Blackmun, J., concurring)

(ADEA); Holliday v. Ketchum, MacLeod & Grove, Inc., 584 F.2d

1221, 1229 (3d Cir. 1978) (in banc) (same); cf., e.g., Dennis v.

Higgins, 498 U.S. 439, 443, 111 S. Ct. 865, 868 (1991) (section

1983).

One overriding lesson the 1991 Act tutors all but its

most unmindful reader is that Congress was unhappy with

increasingly parsimonious constructions of Title VII.

Essentially, Congress forcefully reminded courts of the canon

that Title VII and ADEA, as remedial statutes, are to be

construed liberally to promote their welfare purposes, equality

of treatment and employment opportunities.

34

the law.0 See Wallace, 968 F.2d at 1180-81; cf. Price

Waterhouse, 490 U.S. at 265, 109 S. Ct. at 1798 (O'Connor, J.,

concurring) (stating that if "an illegitimate criterion was a

substantial factor in an adverse employment decision, the

deterrent purpose of [Title VII] has clearly been triggered."

(emphasis in original)).

A strong deterrence policy is the needed stimulus to

propel otherwise indifferent employers into taking affirmative

steps to educate and discipline members of their workforce

insensitive to or disdainful of their co-workers' civil rights.

Economic penalties work as reliable engines to drive home

forcefully to rational employers the seriousness and solemnity of

our national policy denouncing discrimination, and thereby

inspire affirmative responses. See Albemarle Paper, 422 U.S. at

417-18, 95 S. Ct. at 2371-72 ("It is the reasonably certain

prospect of a backpay award that provide[s] the spur or catalyst

which causes employers . . . to self-examine and to self-evaluate

their employment practices and to endeavor to eliminate, so far

0

"The `primary objective' of Title VII is to bring employment

discrimination to an end." Ford Motor Co. v. EEOC, 458 U.S. 219,

228, 102 S. Ct. 3057, 3063 (1982) (citing Albemarle Paper, 422

U.S. at 417, 95 S. Ct. at 2371); see 28 U.S.C.A. § 621(b) (1985)

(listing the purposes of ADEA, including "to prohibit arbitrary

age discrimination in employment"); Zinger v. Blanchette, 549

F.2d 901, 905 (3d Cir. 1977) ("The primary purpose behind [ADEA]

is to prevent age discrimination in hiring and discharging

workers."), cert. denied, 434 U.S. 1008, 98 S. Ct. 717 (1978).

Compensating victims to make them whole, while also of great

weight, is a secondary objective. See Albemarle Paper, 422 U.S.

at 417-18, 95 S. Ct. at 2371-72; cf. Teamsters, 431 U.S. at 364,

97 S. Ct. at 1869 (stating that the deterrence and compensatory

purposes are "equally important").

35

as possible, the last vestiges of an unfortunate and ignominious

page in this country's history." (internal quotations omitted));

cf. Landgraf v. USI Film Prods., 114 S. Ct. 1483, 1506 & n.35

(1994) (recognizing that liability impacts "private parties'

planning"); City of Riverside v. Rivera, 477 U.S. 561, 575, 106

S. Ct. 2686, 2694 (1986) (plurality) (section 1983) (stating that

"the damages a plaintiff recovers contribute significantly to the

deterrence of civil rights violations in the future").0

0

On the other hand, allowing employees or applicants who

committed fraud or misbehaved on the job to prevail will not

notably diminish their disincentive to wrong or deceive their

employers or their prospective employers. It seems unreasonable

to attribute to the wrongdoing employee or applicant the strategy

to lie to or cheat his or her employer or prospective employer

with the expectation that, if the employer unlawfully

discriminates against him or her, it will not be able to use that

wrongful conduct against him or her if discovered in the course

of the resulting proceedings. See Massey, 828 F. Supp. at 322

n.10 ("We find it preposterous that an employee would refrain

from lying [on a résumé or employment application] because she

anticipates that she may be illegally discriminated against later

and wants to preserve her right to recover damages.").

Applicants misrepresent their qualifications in order to secure

the employment in the first place, a powerful incentive that will

not be curtailed by the unlikely prospect, of which the great

bulk of applicants and employees will be unaware, that the

employer may discover the falsehood in an employment discrimina-

tion action and will be able to exploit it to bar the employee's

or applicant's claim. The applicant's incentive not to be

dishonest, and the employee's incentive not to breach his or her

duties of truthfulness, loyalty, and obedience, stem from the

fact that he or she is always subject to disciplinary measures if

the employer learns of the wrong outside the context of discovery

in an employment discrimination case. The only applicant or

employee incentive that will wane if after-acquired evidence is

allowed to bar all liability is the plaintiff's vindication of

his or her federal rights when he or she is unlawfully

discriminated against, even where the discrimination is ongoing,

especially since any attorney the plaintiff might consult would

presumably become aware of the rule.

We note in passing that many employers in fact

responsibly investigate applicants across-the-board before hiring

36

Of course, the efficacy of the after-acquired evidence

tactic has not escaped the attention of defense counsel, some of

whom have recommended that, to maximize a client's odds of

success, defense counsel's first step when defending an

employment discrimination claim should be thoroughly to

investigate the plaintiff's background and job performance.

Indeed, many have instructed employers on specific policies they

can implement to erect the strongest possible defense in

employment discrimination suits, and, if recognized, one can

anticipate the extensive and effective use of the after-acquired

evidence doctrine.0 The prospect of a defendant's thorough

someone, and that the employer's need for truthful employment

applications has been sharpened with the spread of employer

liability for "negligent hiring." An employment-discrimination

suit brought by a discharged employee or unsuccessful applicant,

however, does not provide a sound business (as opposed to litiga-

tion) reason for the employer to begin investigating its ex-

employee's or applicant's honesty and fidelity.

0

See James A. Burstein & Steven L. Hamann, Better Late Than Never

-- After-Acquired Evidence in Employment Discrimination Cases, 19

EMPLOYEE REL. L.J. 193, 202-03 (1993) ("[A]fter-acquired evidence

should be factored in crafting personnel policies. Foremost

among the considerations is to ensure that applications and

employee manuals expressly state that resumé fraud or application

misrepresentations will result in suspension pending discharge.

. . . Second, a prompt and thorough investigation of a

complaint's discrimination charge should be conducted."); David

D. Kadue & William J. Dritsas, The Use of After-Acquired Evidence

in Employee Misconduct and Resume Fraud Cases, 1993 LAB. L.J.

531, 531 [hereinafter Kadue & Dritsas, The Use of After-Acquired

Evidence] (stating that when an employee sues for employment

discrimination, commonly "the employer investigates the former

employee's background with special care"); George D. Mesritz,

"After-Acquired" Evidence of Pre-Employment Representations: An

Effective Defense Against Wrongful Discharge Claims, 18 EMPLOYEE

REL. L.J. 215, 215, 222-25 (1992) ("Management should respond to

this favorable development [-- the judicial recognition of the

after-acquired evidence doctrine --] by routinely searching for

pre-employment misrepresentations as a potential defense in all

37

inquiry into the details of a plaintiff's pre- and post-hiring

conduct, however, may chill the enthusiasm and frequency with

which employment discrimination claims are pursued, even in cases

where the victim of discrimination has nothing to hide, let alone

cases where the potential plaintiff is not entirely blameless.0

Placed in context of the general pervasiveness of résumé fraud

and employee misconduct,0 the likely consequence of the wide-

discharge litigation. Employers in turn should maximize the

probability that `after-acquired' evidence is available as a

defense by revising employment applications to elicit even more

specific information."); Robert M. Shea, Posttermination

Discovery of Employee Misconduct: A New Defense in Employment

Discrimination Litigation, 17 EMPLOYEE REL. L.J. 103, 103-04, 109

(1991) [hereinafter Shea, Posttermination Discovery of Employee

Misconduct] (explaining that Summers "gives employers a legal

basis and, more importantly, a good reason for taking a broader

approach to discovery in employment discrimination litigation"

and advising employers to "scrutinize representations made by the

plaintiff during the hiring process" and to look for "previously

undiscovered misconduct"); William S. Waldo & Rosemary A. Mahar,

Lost Cause and Found Defense: Using Evidence Discovered After an

Employee's Discharge to Bar Discrimination Claims, 9 LAB. LAW. 31,

32, 40-42 (1993) (advising defense counsel to "leave no stone

unturned in ferreting out any evidence" of résumé fraud or

employment misconduct by conducting "a thorough post-termination

investigation").

0

See Massey, 828 F. Supp. at 323 (reasoning that "the use of

after acquired evidence to bar a discrimination claim in its

entirety could cause employees who did something wrong in the

past to quietly endure discriminatory treatment rather than

complain, regardless of how long ago the misconduct occurred or

its triviality"). Moreover, the inevitable "fishing expedition[]

. . . for `minor, trivial or technical infractions,'" Washington,

969 F.2d at 256 (quoting O'Driscoll v. Hercules, Inc., 745 F.

Supp. 656 (D. Utah 1990)), might curtail the success of victims

of employment discrimination in bringing lawsuits and thereby

erode the effectiveness of Title VII and ADEA. See, e.g.,

McKennon, 9 F.3d at 540-41 & nn.1 & 3 (describing the employer's

masterful use of after-acquired evidence).

0

By all accounts, résumé fraud is a serious and recurrent problem

facing employers. See, e.g., Mitchell H. Rubinstein, The Use of

Predischarge Misconduct Discovered After an Employee['s]

Termination as a Defense in Employment Litigation, 24 SUFFOLK U.

38

spread exploitation of after-acquired evidence will be underen-

forcement of Title VII and ADEA, and consequently underdeterrence

of discriminatory employment practices.0

This leads us to a final reason why liability is proper

in a Title VII or ADEA after-acquired evidence case, namely, the

other paramount objective of those statutes "`to make persons

whole for injuries suffered on account of unlawful employment

discrimination.'" Franks, 424 U.S. at 763, 96 S. Ct. at 1264

(quoting Albemarle Paper, 422 U.S. at 418, 95 S. Ct. at 2372);

see id. at 764, 96 S. Ct. at 1264 (stating that the plaintiff

should be made "whole insofar as possible"); see Albemarle Paper,

422 U.S. at 418-21, 95 S. Ct. at 2372-73; supra at Error!

Bookmark not defined. n.Error! Bookmark not defined.. Of course,

the corollary to the make-whole directive is that the protected

L. REV. 1, 1 n.2 (1990); Shea, Posttermination Discovery of

Employee Misconduct, 17 EMPLOYEE REL. L.J. at 403 n.3; Zemelman,

The After-Acquired Evidence Defense, 46 STAN. L. REV. at 176 n.5;

see also Douglas L. Williams & Julia A. Davis, Title VII Update

-- Skeletons and a Double-Edged Sword, C669 A.L.I.-A.B.A. 303,

305 (1991) ("At one time or another probably every employee

commits an infraction at work and hopes that the boss never finds

out.").

0

Some courts have tried to deal with the problem of

underenforcement by requiring the fraud or misconduct to be

material before accepting the employer's defense, see, e.g.,

O'Driscoll, 12 F.3d at 180, but the meaning of materiality has

not been settled. For example, at least one court confronted

with a boilerplate attestation clause in an employment

application has held that the misrepresentation itself, whether

material or not standing alone, became material by virtue of the

clause, rendering the materiality requirement largely

meaningless. See Milligan-Jensen, 975 F.2d at 303-04 & nn. 1 &

2; cf. Johnson, 955 F.2d at 414 (holding that an employer's

asserted actual reliance upon the plaintiff's misrepresentation

made it material as a matter of law); Gilty, 919 F.2d at 1251

(holding that a plaintiff's misrepresentation ipso facto rendered

him unqualified for the job).

39

employee is not to be catapulted into a better position than he

or she would have enjoyed had the employer not acted unlawfully.

See Burdine, 450 U.S. at 259, 101 S. Ct. at 1096 ("Title VII

. . . does not demand that an employer give preferential

treatment

to minorities or women."); cf. Mt. Healthy, 429 U.S. at 285-86,

97 S. Ct. at 575.

Keeping in mind the aspiration, then, that the

plaintiff should be left in the same position as he or she was in

before the discrimination, the bottom line is straightforward.

On the one hand, holding the employer liable and providing the

victim appropriately fashioned remedies would restore the victim

to his or her prior position, not a better one than had he or she

not suffered from unlawful discrimination. On the other hand,

barring all remedies would leave the victim in a worse position

than had the employer not unlawfully discriminated against him or

her (in which case the employee assumedly would still be

employed), and elevates the employer to a superior position

insofar as it lets the employer get off scot-free despite its

blameworthy conduct. These two observations hold true especially

in instances where the employer's discovery of the after-acquired

evidence was brought about due to the legal proceedings

instituted in response to the employer's wrongful acts, since in

those cases, absent the discrimination, the employer may never

have discovered the evidence (or at least not until some

indeterminate future time). See Wallace, 968 F.2d at 1179-80;

40

Welch, 23 F.3d at WL at *3 (Arnold, J., dissenting);0 cf. John

Cuneo, Inc., 298 N.L.R.B. 856, 856 (1990). In short, a major

weakness of the Summers approach is that it does not restore a

victim to the position he or she would have occupied but for the

discrimination.

6. Summary

For all the foregoing reasons, we hold that after-

acquired evidence is inadmissible, because irrelevant, at the

liability stage of a cause of action brought under Title VII or

ADEA. We do not rule out the potentiality that such evidence may

0

We think that Judge Arnold got the better of the argument in his

dissent in Welch:

I respectfully suggest that the court errs in

concluding that if defendant can show that it would

never have hired Mr. Welch but for his

misrepresentation, then Mr. Welch will be in no worse

position than he would have been but for the alleged

illegal act. The crucial points are that the defendant

did hire him and did not know of the facts that might

have led to Mr. Welch's discharge until it discovered

them because suit was filed against it. The defendant

might never have learned of those facts, or it might

have learned of them fortuitously at some later time.

Until it did so, those facts could hardly provide an

excuse for termination, since they could not have

provided any part of the defendant's motive. If Mr.

Welch is not compensated for losses suffered between

the time he would have been fired on account of the

discovery of relevant facts, he is not in the same

position he would have been in but for a wrong commit-

ted against him, and the purpose of the protective

legislation is entirely lost.

. . . The plaintiff does not seek to benefit

from his misrepresentation, if any. He seeks simply to

have the law applied to him in an evenhanded way.

Id. at ____ *3.

41

serve as the foundation for a claim of fraud, conversion, or the

like by the employer against the plaintiff in an appropriate

forum, but only that it may not be introduced substantively for

the purpose of defending against liability. We must accordingly

reverse the district court's grant of summary judgment to

Harleysville and remand for further consideration.

B. The Remedies Stage

Because the district court must proceed further with

this case and may well have to reach the remedies stage, for the

guidance of that court on remand we will make a few comments

about the remedies facet of the case. We note in this regard

that the questions of how the after-acquired evidence may be used

harmoniously with Title VII's and ADEA's language and goals, and

of what remedies should inure to a plaintiff in an after-acquired

evidence case, seem to be far more stubborn than the liability

issue.

First, after-acquired evidence of résumé and/or

application fraud or employer misconduct on the job is relevant

to at least some issues at the remedies stage (and hence is

admissible at that point), even if it has surfaced after the

employer's searching inquiry in the aftermath of the employer's

unlawful conduct or in the course of its trial preparation.0 The

0

We observe that in a normal Title VII or ADEA case, evidence

acquired before the adverse employment decision might, as a

prophlactic measure, be inadmissible altogether if the plaintiff

could show that the employer had a practice of thoroughly

investigating the information provided in employment applications

and interviews by, and of comprehensively reviewing on-the-job

42

court should, of course, be cautious lest the remedies evidence

affect the liability verdict.

Second, at the remedies stage, the district court must

bear in mind Title VII's and ADEA's two principal objects:

deterrence and compensation. See Albemarle Paper, 422 U.S. at

421, 95 S. Ct. at 2373; Griggs v. Duke Power Co., 401 U.S. 424,

429-30, 91 S. Ct. 849, 853 (1971); supra at Error! Bookmark not

performance of, only or primarily only the members of a protected

class with the motive to discover flaws justifying an adverse

employment action, for such a practice would probably contravene

Title VII and ADEA. Assuming it were so, since the filing of the

lawsuit would appear to be an activity protected to the same

extent as membership in another protected class, see 42 U.S.C.A.

§2000e-3(a) (1981) ("It shall be an unlawful employment practice

for an employer to discriminate against any of his employees or

applicants for employment . . . because he has opposed any

practice made an unlawful employment practice by this subchapter,

or because he has made a charge, testified, assisted, or

participated in any manner in an investigation, proceeding, or

hearing under this subchapter."); 29 U.S.C.A. § 623(d) (1985)

(similar), it would seem to follow that the aforementioned

defense strategy of investigating employees who file complaints

with the intent to discover evidence retroactively justifying or

excusing the adverse employment decision may itself violate Title

VII and ADEA, and if so it might be contrary to the design of

those statutes to allow the employer to benefit from (introduce)

such evidence.

Accordingly, an argument could be made that such

evidence should be excluded from consideration as the fruits of

unlawful retaliation even in the remedies stage of a Title VII or

ADEA suit. That is, if it were the case that the calculated

discovery of after-acquired evidence (as opposed to, for example,

its inadvertent or independent discovery) amounts to retaliation

under Title VII or ADEA, although it is exceedingly unlikely that

any economic damages would flow therefrom, it may very well be

that any evidence so stained would have to be suppressed at the

remedies stage of the proceedings, except perhaps to show that

reinstatement would threaten the public health, safety, or

welfare, or would otherwise violate a public policy on par with

the one antithetical to employment discrimination. This

argument, however, was not advanced in this case until oral

argument, and we shall decline to further consider it.

43

defined. n.Error! Bookmark not defined.. Congress has from Title

VII's inception expected courts to fashion remedies guided by the

acts' twin central goals. See Franks, 424 U.S. at 763-64, 96 S.

Ct. at 1263-64. To advance these goals, a district court is

under the "`duty to render a decree which will so far as possible

eliminate the discriminatory effects of the past as well as bar

like discrimination in the future.'" Franks, 424 U.S. at 770, 96

S. Ct. at 1267 (quoting Albemarle Paper, 422 U.S. at 418, 95 S.

Ct. at 2372).0

0

The same standard applies under ADEA. As we explained in

Rodriguez v. Taylor, 569 F.2d 1231 (3d Cir. 1977), cert. denied,

436 U.S. 913, 98 S. Ct. 2254 (1978):

Monetary awards exacted from employers who

practice unlawful discrimination serve two primary

functions. First, the prospect of economic penalties

more certainly deters illegal employment practice[s]

than does exposure to injunctive relief or prospective

equitable remedies such as reinstatement. Second,

economic exactions recompense individuals for injuries

inflicted by employers' discriminatory conduct. These

prophylactic and compensatory purposes are the basis of

most recent anti-employment discrimination legislation,

including the ADEA and Title VII. Thus, the Supreme

Court's mandate on the exercise of trial court's

discretion in granting monetary relief in Title VII

suits . . . is equally compelling in the context of

ADEA actions . . . .

The make whole standard of relief should be the

touchstone for the district courts in fashioning both

legal and equitable remedies in age discrimination

cases. Victims of discrimination are entitled to be

restored to the economic position they would have

occupied but for the intervening unlawful conduct of

employers.

Id. at 1237-38 (citations omitted).

44

Third, we illustrate these points with respect to the

most common remedy, backpay. The Supreme Court has laid down the

general rule under Title VII that

given a finding of unlawful discrimination, backpay

should be denied only for reasons which, if applied

generally, would not frustrate the central statutory

purposes of eradicating discrimination throughout the

economy and making persons whole for injuries suffered

through past discrimination.

Albemarle Paper, 422 U.S. at 421, 95 S. Ct. at 2373, quoted in

Franks, 424 U.S. at 771, 96 S. Ct. at 1267. We have applied the

same standard to ADEA. See Rodriguez, 569 F.2d at 1238 (quoting

Albemarle Paper as quoted supra). But some courts cut backpay

off prematurely at the moment the employer obtains the after-

acquired evidence. See, e.g., Kristufek v. Hussmann Foodservice

Co., 985 F.2d 364 (7th Cir. 1993); Smith, 876 F.2d at 1319 n.2

(dicta); cf. John Cuneo, 298 N.L.R.B. at 856. This formula is,

however, inconsistent with the effectuation of the statutes'

deterrent and compensatory purposes, and we favor the normal rule

that, when otherwise appropriate, backpay should be awarded until

the date of judgment. Accord Wallace, 968 F.2d at 1182; Massey,

828 F. Supp. at 323.

We reach this result by considering the statutory

policies at stake. Insofar as after-acquired evidence is

uncovered during the legal dispute and would not have been

discovered, at least for an indeterminate stretch of time, absent

the employer's unlawful acts, the plaintiff would be left in a

worse position because of the discrimination if the court were to

make use of that evidence to limit the victim's remedies, and the

45

make-whole compensatory goal of the acts would not be reached.

Confining backpay to the discovery date would also dilute the

deterrent effect of Title VII and ADEA, an effect best promoted

with an award of backpay, see supra (quoting Albemarle Paper).

On the other end of the scale weighs the policy of

allowing employers free choice (primarily encroached on by

reinstatement rather than by an award of backpay), see, e.g.,

Ezold v. Wolf, Block, Schorr & Solis-Cohen, 983 F.2d 509, 527 (3d

Cir. 1992) (citing cases), and the difficulty in ignoring such

evidence insofar as it could be read as condoning the employee's

misbehavior, cf. Summers, 864 F.2d at 708 ("To argue . . . that

this after-acquired evidence should be ignored is utterly

unrealistic."). But the fact that courts will not turn a blind

eye to employee fraud and misconduct is adequately demonstrated

in cases where the employer in fact bases its adverse employment

decision on the employee's wrongful actions, because then the

evidence is fully considered at every stage of the dispute, and

also perhaps in context of other remedies (like reinstatement) in

after-acquired evidence cases.

There are occasions, of course, when after-acquired

evidence is useful in measuring backpay: if the employer can

somehow insulate its illegal actions from its discovery of the

disfavorable evidence, it is free to act on it (keeping in mind

the prohibition against retaliation, see supra at Error! Bookmark

not defined. n.Error! Bookmark not defined.) to discipline its

employee, as there would be no causation. One example is where

the employer would have inevitably discovered the evidence in the

46

normal progression of things (that is, assuming no litigation).0

Alternatively, the employer may happen upon the evidence

completely independently of any investigation prompted by the

discriminatory employment action or its aftermath, including the

legal proceedings.0 Proof of either of these occurring would

entitle an employer to cut off all further liability from the

time the employer can establish with reasonable certainty the

date of the inevitable or independent discovery, so long as the

employer additionally shows that based upon that evidence it

indeed would have taken the same employment action at that time.

See Wallace, 968 F.2d at 1182 (ending backpay at the earlier of

(i) the date of judgment, and (ii) the date the employer can show

it would have discovered evidence, independently of the adverse

employment decision and the ensuing litigation, which would have

0

See, e.g., Rodriguez, 431 U.S. at 403 n.9, 97 S. Ct. at 1897 n.9

(allowing the company to prove at trial that the applicant "would

not have been hired in any event"); Sabree, 921 F.2d at 405

(reducing damages if the employer would have inevitably

discovered that the plaintiff was ineligible for a transfer);

Smallwood v. United Air Lines, Inc., 728 F.2d 614, 626-27 (4th

Cir.) (holding that the plaintiff was not entitled to backpay

because the employer would have inevitably discovered his prior

misconduct and would not have hired him even had it not

discriminated against him), cert. denied, 469 U.S. 832, 105 S.

Ct. 120 (1984). But see Summers, 864 F.2d at 707 n.3 ("[T]he

probability that Summers' transgressions would have been

discovered in the absence of the trial is immaterial.").

0

See Gilty, 919 F.2d at 1249, 1255-56 (holding that a discharge

was not retaliatory because a new police chief independently

undertook a comprehensive review of all the city's officers'

credentials); cf. Welch, 23 F.3d at WL at *3 (Arnold, J.,

dissenting) (referring to the defendant's "fortuitous" discovery

of the evidence).

47

led it to take the same adverse action with respect to the

employee); Massey, 828 F. Supp. at 324 (same).0

Fourth, we must stress in terms of policy the

importance of the background rule of employer free choice. The

federal anti-employment discrimination laws were designed not to

impinge directly upon employer free choice; that is, not to

interfere unnecessarily with legitimate business operations and

decisions. See Burdine, 450 U.S. at 259, 101 S. Ct. at 1096

("[Title VII] was not intended to `diminish traditional

management prerogatives.'" (quoting United Steelworkers v. Weber,

442 U.S. 193, 207, 99 S. Ct. 2721, 2729 (1979)); Price

Waterhouse, 490 U.S. at 242, 109 S. Ct. at 1786 (stressing that

an "important aspect of [Title VII] is its preservation of an

employer's remaining freedom of choice"). For example, the

federal employment discrimination laws do not alter the

employment-at-will doctrine except in limited respects. See

supra at 30 & n.Error! Bookmark not defined.. Their goal instead

is to restore the victim of the employer's illegal conduct to the

position he or she would have occupied absent the discrimination.

0

For example, if the inevitable or independent discovery would

have preceded an applicant's hiring, probably no back pay would

be due. See Smallwood, 728 F.2d at 626. By contrast, declar-

atory and injunctive relief as well as attorneys' fees, properly

apportioned, might still be available. Moreover, in cases

governed by the Civil Rights Act of 1991, the plaintiff might

also be able to recover compensatory damages and, if the employer

acted "with malice or with reckless indifference to the federally

protected rights of an aggrieved individual," punitive damages,

see Civil Rights Act of 1991, Pub. L. No. 102-166, § 102, 105

Stat. 1072-73 (codified at 42 U.S.C.A. §1981a(a)(1), (b)(1)

(Supp. 1994)), irrespective of inevitable or independent

discovery.

48

Thus, where an equitable remedy, such as reinstatement, would be

particularly invasive of the employer's "traditional management

prerogatives," the after-acquired evidence may bar that remedy.

Cf. supra at Error! Bookmark not defined. n.Error! Bookmark not

defined..

For the foregoing reasons, we will vacate the district

court's order granting summary judgment to Harleysville, and

remand the case to the district court for further proceedings

consistent with this opinion.

49