# Amicus Curiae Brief — Arbaugh v. Y & H Corp.

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URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385016_0065%3A11

## Record

- **Collection:** Supreme Court brief
- **Document type:** Amicus Curiae Brief
- **Published:** January 1, 2006
- **Citation:** 546 U.S. 500

## Text

of the plaintiff's claim turns on an analysis of “[t]he
structure of Title VII, the congressional policy underlying it,
and the reasoning of [this Court's] cases.” See Zipes, 455
U.S. at 393. These considerations “all lead to this
conclusion” (ibid.): Section 701(b)’s 15-employee
requirement is jurisdictional.

Section 703(a) of Title VII, entitled “Employer practices,”
provides in relevant part:

It shall be an unlawful employment practice for an
employer —

(1) to fail to refuse to hire or to discharge any
individual, or otherwise to discriminate against any
individual with respect to his compensation, terms,
conditions, or privileges of employment, because of
such individual’s race, color, religion, sex, or
national origin.

42 US.C. § 2000e-2(a). Section 701(b) of Title VII in turn
provides that “[t]he term ‘employer’ means a person
engaged in an industry affecting commerce who has fifteen
or more employees for each working day in each of twenty
or more calendar weeks in the current or preceding calendar
year.” Id. § 2000e(b). Finally, § 706(f)(3) of the Act states in
relevant part that “[eJach United States district court ...
shall have jurisdiction of actions brought under this title.”
Id. § 2000e-5(f)(3).

The placement of the term “employer” in the preamble
to § 703—apart from the description of acts that trigger
liability —confirms that it is a threshold issue and distinct
from merits questions involving the defendant's conduct
toward the plaintiff. The determination whether the
defendant is an “employer” precedes any inquiry into
whether the defendant “discriminate[d]” against the
plaintiff. That is, before the court delves into merits issues
such as whether the plaintiff was subjected to
“discrimination,” whether the discrimination concerned

“compensation, terms, conditions, or privileges of
employment,” or whether the defendant discriminated
against the plaintiff “because of” her sex (or some other
prohibited reason), it must first determine that the
defendant is among the class of entities to whom the statute
applies. As this Court has elsewhere explained: when
Congress “expressly exempted ... small businesses” from
Title VII, it granted them “complete immunity” from Title
VII. Hishon, 467 U.S. at 78 & n.11 (emphasis added). This
immunity for small employers—including many, if not
most, municipal and county agencies — entails relief not only
from liability, but also from having to defend themselves on
the merits.

A. This Court’s Section 1983 Decisions
Confirm that in the Context of Federal Civil
Rights Legislation, Limitations on the Class
of Entities Subject to Liability Are
Jurisdictional.

This Court's decisions concerning 42 U.S.C. § 1983 and
28 U.S.C. § 1343, its jurisdictional partner, are instructive in
this regard. Section 1983 renders liable every “person” who,
under color of state law, deprives citizens of civil rights in
violation of the Constitution or federal law, and § 1343
grants federal district courts jurisdiction of civil actions
brought to redress such deprivations. This Court has read
the grant of subject matter jurisdiction in § 1343 to extend
only to cases in which the defendant is covered by § 1983.

1. In City of Kenosha v. Bruno, 412 U.S. 507 (1973), for
example, the Court considered whether § 1343 extended to
equitable § 1983 claims against cities. After reiterating that
§ 1983's definition of “person” did not cover municipalities,
the Court held that § 1343’s grant of subject matter
jurisdiction precisely tracked the scope of § 1983: Because
“Congress did not undertake to bring municipal
corporations within the ambit of § 1983,” “[t}]he District

Court was therefore wrong in concluding that it had
jurisdiction of appellees’ complaints under § 1343.” Id. at
513 (citation omitted).

Similarly, in Aldinger v. Howard, 427 U.S. 1 (1976), the
Court addressed whether § 1343 conferred subject matter
jurisdiction over a § 1983 claim against a county — which, like
a city, was not then a “person” subject to suit under § 1983.
The Court held that it does not, confirming that “the reach
of the statute conferring jurisdiction should be construed in
light of the scope of the cause of action as to which federal judicial
power has been extended by Congress.” Id. at 17 (emphasis
added). The Court further emphasized that jurisdictional
provisions should be read in light of “deductions which
may be drawn from congressional statutes as to whether
Congress wanted to grant this sort of jurisdiction to federal
courts.” Id. at 16-17. In sum, “Congress excluded [counties]
from liability in § 1983, and therefore by reference in the
grant of jurisdiction under § 1343(3).” Id. at 17.

The parallels between these § 1983 cases and the present
case are striking. There, as here, the threshold issue was the
meaning of terms (there “persons,” here “employers”) that
delimited the class of defendants who were properly subject
to federal civil rights legislation. There, as here, the
question was not whether the defendant's conduct violated
the terms of the statute, but whether the defendant was a
type of entity that Congress determined to regulate. There, as
here, the statutory provision delimiting the courts’ subject
matter jurisdiction (§ 1343(3)) was separate from the
substantive provision confining liability to certain parties
(§ 1983). There, as here, the jurisdictional provision
contained no explicit reference to the class of entities
covered by the statute. And there, as here, small state and
local agencies would have borne litigation burdens beyond
those that Congress intended if the Court had formalistically
held that the “person” limitation of the Civil Rights Act was

found only in § 1983—and thus could not be read to limit
subject matter jurisdiction under § 1343.

Just as the Court in City of Kenosha and Aldinger read
§ 1343 in light of § 1983, so should the Court read § 706(f)(3)
of the Civil Rights Act in light of § 701(b) of that Act. As the
Court explained in Aldinger, “[t]he question ... is whether
by virtue of the statutory grant of subject-matter
jurisdiction, ... Congress has addressed itself to the party as
to whom jurisdiction ... is sought.” 427 US. at 16
(emphasis added). If a defendant is not an “employer”
within the meaning of § 701(b), neither is a suit against the
defendant within the courts’ jurisdiction under § 706(f)(3).
The fact that “the 15-employee requirement is found in Title
VII's definition of ‘employer,” “but not in Title VII's
jurisdictional provision” (U.S. Br. 6), is immaterial under
these decisions.

2. Although the Solicitor General contends otherwise
(U.S. Br. 21), this Court’s decision in Mt. Healthy City Board of
Education v. Doyle, 429 U.S. 274 (1977), does not lead to a
different result. The plaintiff there asserted jurisdiction
under § 1343 as well as § 1331, and the Court did not need to
analyze subject matter jurisdiction under § 1343 because it
found jurisdiction under § 1331. See 429 U.S. at 278-279.
Indeed, citing City of Kenosha, the Court expressly observed
that “if this were a § 1983 action, brought under the special
jurisdictional provision of 28 U.S.C. § 1343 which requires
no amount in controversy, it would be appropriate to
inquire, for jurisdictional purposes, whether a statutory
action had in fact been alleged.” Ibid. Thus, Mt. Healthy is of
a piece with Aldinger and City of Kenosha—a fact confirmed
by this Court's statement just last Term that “Congress, in
enacting § 1343, had declined (albeit implicitly) to extend
federal jurisdiction over any party who could not be sued

10

under the federal civil rights statutes.” See ExxonMobil v.
Allapatah, 125 S. Ct. 2611, 2619 (2005).3

Petitioner and the United States suggest that if Title VII's
15-employee requirement goes to the courts’ subject matter
jurisdiction, the effect will be a slippery slope: “every other
required element of the plaintiff's case would presumably
be jurisdictional as well.” U.S. Br. 13; Pet. Br. 19. But as
these § 1983 cases recognize, the threshold question of
whether a statute applies to a certain class of defendants is not
like other garden-variety Title VII issues involving liability.
Where Congress excludes a class of entities from regulation,
that determination ordinarily ought to protect those entities
not only from liability for their conduct, but also from the
“potentially crushing expense” of extended discovery on the
whole range of fact-intensive issues that a Title VII suit
raises. See Papa v. Katy Indus., Inc., 166 F.3d 937, 940 (7th
Cir. 1999) (Posner, J.) As Congress recognized, this is
particularly true for small entities — including a host of state
and municipal agencies— whose very survival or ability to
provide public services may depend on their ability to avoid
the extraordinary costs of mounting a defense to fact-
intensive claims of discrimination.

As a practical matter, moreover, the question of whether
a party is within the class of entities covered by a statute can
be resolved relatively easily on a motion to dismiss or with
limited discovery. This is especially so with Title VII's
numerosity requirement. Whether an employer has an
“employee” for Title VII purposes is determined by the
“payroll method,” which simply inquires how many
persons appear on the payroll during the relevant time
period. See Walters v. Metropolitan Educ. Enters., Inc., 519

3 See also Finley v. United States, 490 U.S. 545, 573 (1989) (Stevens,
J., dissenting) (“Congress’ exclusion of municipal corporations
from the definition of persons under § 1983 .. . evinced an intent
to preclude the exercise of federal-court jurisdiction over them”).

11

U.S. 202, 206 (1997). The Court in Walters observed that
whether a defendant satisfies the numerosity requirement is
“readily demonstrated” by examination of the payroll, and
it rejected an alternative reading of Title VII's numerosity
requirement in part because it “would turn the coverage
determination into an incredibly complex and expensive
factual inquiry.” Id. at 206, 210 (emphasis added). Under
current precedent, then, whether a defendant has sufficient
employees to fall within Title VII's jurisdiction turns on a
straightforward assessment of the payroll: “all one needs to
know about a given employee for a given year is whether
the employee started or ended employment during that year
and, if so, when.” 519 US. at 211. The United States’
suggestion that the 15-employee inquiry is “fact-intensive”
(U.S. Br. 16) cannot be squared with this analysis, which it
ignores.

The nature of the court's factual inquiry into the number
of a defendant’s employees is wholly unlike that involved in
analyzing “the elusive factual question of intentional
discrimination.” See Burdine, 450 U.S. at 255 n.8. Merits-
related Title VII issues—such as whether the plaintiff
suffered adverse treatment “because of” her sex—are “both
sensitive and difficult,” since “[t]here will seldom be
‘eyewitness’ testimony as to the employer's mental
processes.” See Aikens, 460 U.S. at 716; see also Singfield v.
Akron Metro. Hous. Auth., 389 F.3d 555, 564 (6th Cir. 2004)
(observing that “an employer's true motivations are
particularly difficult to ascertain”). Understandably, then,
Congress made the courts’ subject matter jurisdiction under
Title VII turn on the discrete, objective, and “readily
demonstrated” threshold question of whether an employer
has 15 employees. Walters, 519 U.S. at 206.

3. Zipes is not to the contrary. Relying substantially on
the legislative history, the Court there held that “Congress
intended the filing period to operate as a statute of
limitations instead of a jurisdictional requirement.” 455 U.S.

12

at 394. That is not surprising. In contrast to statutory
questions concerning the class of entities covered by Title
Vil—which determines the availability of “complete
immunity” for small employers (Hishon, 467 U.S. at 78)—a
limitation period's applicability is “an area over which the
federal courts historically have asserted equitable discretion
to craft rules of tolling, laches, and waiver.” American
Trucking Ass‘ns, Inc. v. Smith, 496 U.S. 167, 221 (1990)
(Stevens, J., dissenting).

More importantly, the Court's overall analytical
approach in Zipes in fact supports affirmance here. Zipes
turned on an analysis of “[t}he structure of Title VII, the
congressional policy underlying it, and the reasoning of
[this Court's] cases.” 455 U.S. at 393. Each of those factors
supports a jurisdictional reading of the 15-employee
requirement. First, under the structure of Title VII, the
requirement is located in an independent clause (the
preamble), separate from the paragraph that establishes the
terms of liability. Second, the “congressional policy” behind
the requirement is to spare small employers the exorbitant
expense of defending fact ‘iitensive discrimination claims —
and that policy would be undermined by a nonjurisdictional
reading of § 701(b). See Part II, infra. Third, this Court's
§ 1983 decisions confirm that where Congress excludes a
class of entities from the federal civil rights laws, such
exclusions should ordinarily be viewed as jurisdictional.‘

4 The Solicitor General acknowledges that subject matter
jurisdiction “can and does ... turn in appropriate cases on
whether the United States is a party; whether the defendant is a
foreign state or member of a foreign mission; or whether the
parties are citizens of different States.” U.S. Br. 22 (citations
omitted). Thus, he rightly points out that many instances in which
the identity of the defendant is relevant to the courts’ subject
matter jurisdiction involve governmental defendants. But that does
not mean that cases against the government are the only cases in
which this is true. Contrary to the Solicitor General's assertion, no

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B. The Canon that Statutes Should Be
Interpreted to Avoid Constitutional
Difficulties Resolves Any Doubt in Favor of
a Jurisdictional Reading of Title VII's 15-
Employee Requirement.

As demonstrated above, Title VII's 15-employee
requirement is most naturally read, both textually and in
light of Congress’s purpose to exclude small employers
from Title VII coverage, as a limitation on the subject matter
jurisdiction of the courts. But if there were any doubt on
this score, settled rules of statutory construction would
resolve that doubt in favor of a jurisdictional reading of

§ 701(b).

One such rule is that “[i]t is to be presumed that a cause
lies outside [the federal courts’] limited jurisdiction,” and
“the burden of establishing the contrary rests on the party
asserting jurisdiction.” Kokkonen v. Guardian Life Ins. Co., 511
U.S. 375, 377 (1994). This canon is closely related to the
more general rule that “where an otherwise acceptable
construction of a statute would raise serious constitutional
problems, the Court will construe the statute to avoid such
problems unless such construction is plainly contrary to the
intent of Congress.” Edward |. DeBartolo Corp. v. Florida Gulf
Coast Bldg. & Constr. Trades Council, 485 U.S. 568, 575 (1988).
“This cardinal principle . . . has for so long been applied by
this Court that it is beyond debate.” Ibid. The Court does
not assume that Congress casually “push[es] the limit of
congressional authority.” Solid Waste Agency of No. Cook
County v. United States Army Corps of Eng’rs, 531 U.S. 159,
173 (2001) (SWANCC). Thus, “[w]here an .. . interpretation

one is suggesting that “questions regarding the ‘applicability’ of
statutes or the classes of people who may be sued under them are
necessarily jurisdictional.” bid. But neither is it true that the
identity of the defendant, even if a private entity, is necessarily a
merits question.

14

of a statute invokes the outer limits of Congress’ power” or
raises “significant constitutional questions,” the Court
“expect[s] a clear indication that Congress intended that
result.” Id. at 172, 174.

These principles apply forcefully here. Congress relied
on its interstate commerce power as the constitutional basis
for enacting Title VII (see 42 U.S.C. § 2000e(b); U.S. Const.
art. |, §8, cl. 3; Pet. Br. 14 n.18), and it adopted Title VII's
employee numerosity requirement as a means of respecting
the limits of that power. The questionable constitutionality
of a broader reading of Title VII confirms that this Court
should read the 15-employee requirement as a jurisdictional
limitation rather than simply an element of the plaintiff's
cause of action.

1. It is well settled that Congress may not regulate
intrastate activities under the commerce power unless such
activities “substantially affect interstate commerce.”
United States v. Morrison, 529 U.S. 598, 609 (2000) (quoting
United States v. Lopez, 514 U.S. 549, 558-559 (1995)). During
the legislative debates concerning Title VII, numerous
members of Congress expressed the view that the statute
regulated activities lacking such an effect and that the
minimum-employee requirement was a vital proxy for the
required nexus with commerce. 5 As Representatives Poff
and Cramer expressed the point: “’[t]he bill proceeds on a
theory ... that the quantum of employees is a rational
yardstick by which the interstate commerce concept can be
measured.”” H.R. Rep. No. 914, 88th Cong., Ist Sess. (1963)
(statement of minority views of Reps. Poff & Cramer). In
short, “the floor debates concerning Title VII suggest that
the minimum employee threshold was ... deemed

> See, e.g., US. Equal Employment Opportunity Commission,
Legislative History of Titles VII and XI of the Civil Rights Act of
1964 at 2043, 2050-51, 2061, 2066, 3076, 3078-79, 3079-84, 3084-90
(1968).

15

necessary to justify federal legislation in the employment
context under the Commerce Clause.” Tomka v. Seiler Corp.,
66 F.3d 1295, 1322 (2d Cir. 1995) (Parker, J., dissenting)
(collecting authorities).

The United States denies that the 15-employee threshold
requirement has any constitutional underpinnings
whatsoever. U.S. Br. 24. Under its view, the requirement
that an employer be “in an industry affecting commerce”
(§ 2000e(b)) properly invokes Commerce Clause authority
without regard to the 15-employee threshold. Ibid. But that
view of the commerce power goes well beyond Lopez. The
Court there took pains to reaffirm that the regulated
activity’s effect on interstate commerce must be
“substantial” (Lopez, 514 U.S. at 558); it did not authorize
regulation of an activity lacking such a connection on the
basis that it was within an industry that does. Accord
Morrison, 529 U.S. at 610. As the Court explained in
SWANCC, Commerce Clause analysis turns on whether “the
precise object or activity” at issue “in the aggregate[]
substantially affects interstate commerce.” See 531 US. at
173 (emphasis added).

The Solicitor General’s view would authorize Title VII
regulation of a neighborhood lemonade stand with just two
employees that does not itself have any discerruble effect on
interstate commerce, solely on the basis that it happens to be
within an industry (concessions) that does. Likewise, it
would permit Title VII regulation of a three-employee leaf-
raking business that does not affect commerce on the basis
that it is part of a broader industry (say, landscaping) that
does. Congress, however, rightly believed that it needed a
tighter nexus to interstate commerce, and it found that
nexus in the minimum-employee requirement. See
SWANCC, 531 U.S. at 173 (declining to read § 404(a) of the
Clean Water Act to reach isolated, intrastate ponds); Jones v.
United States, 529 U.S. 848, 851 (2000) (declining to read 18
U.S.C. § 844(i), the federal arson statute, to reach the arson

16

of private residences, because “constitutionally doubtful
constructions should be avoided where possible”).

The Solicitor General also denies that Congress viewed
Title VII's minimum-employee requirement as relevant to
its Commerce Clause authority. He acknowledges the
legislative statement of Representatives Poff and Cramer
quoted above, but asserts that “[t]jaken as a whole, the
legislative history does not support that statement.” U.S. Br.
24 n.4. Asa review of the citations collected above (see n.5)
demonstrates, however, there were extensive Commerce
Clause objections to Title VII. And in response to these
objections, supporters sought to draw a connection between
employee numerosity and Congress's commerce power.
See, e.g. 110 Cong. Rec. 6548 (Mar. 30, 1964) (Sen.
Humphrey); id. at 6566 (Mar. 30, 1964) (Sen. Kuchel); id. at
7088 (Apr. 7, 1964) (Sen. Stennis); id. at 13088 (June 9, 1964)
(Sen. Humphrey). As Senator Humphrey explained: it is
only “[w]hen [small businesses] get above 25, [that] they get
into some reasonable degree of gross product in terms of income
or output or salaries or goods or services.” Ibid. (emphasis
added). Mindful of the limits of its commerce power,
Congress sought to avoid regulating employers whose
activities had little effect on the gross product.®

In any event, whether or not Title VII would ultimately
violate the Commerce Clause if it reached smaller employers,
Congress's concern about the issue demonstrates that the
application of Title VII to smaller employers at least raises a
“significant constitutional question{].”. SWWANCC, 531 US.
at 174. Moreover, the legislative record provides no “clear

¢ Indeed, to the extent that the Commerce Clause concerns
reflected in the legislative history of Title VII involved the earlier,
25-employee minimum (Congress reduced the requirement from
25 to 15 employees in the Equal Opportunity Act of 1972, Pub. L.
92-261, § 2, 86 Stat. 103), those concerns are heightened under the
current 15-employee requirement.

17

indication” that Congress intended to push the outer limits
of its commerce power. See ibid. Quite the contrary.

2. Citing the dissenting opinion in Hartford Fire Ins. Co.
v. California, 509 U.S. 764, 813 (1993), the Solicitor General
notes that legislative and subject matter jurisdiction are
distinct concepts and suggests that Title VII's lezislative
history “speak[s] only to Congress's legislative jurisdiction.”
US. Br. 24, 28. But he offers no reason why Congress would
grant the courts jurisdiction over matters that it lacks the
power to regulate. And as the majority in Hartford Fire
recognized, there are times when the constitutionally
required nexus with interstate commerce
“simultaneous[ly]” implicates both legislative and subject
matter jurisdiction. See 509 U.S. at 795-797 & n.22; see also
United Phosphorus, Ltd. v. Angus Chem. Co., 322 F.3d 942, 947-
948 (7th Cir. 2003) (en banc). This is just such a case.

This Court's decision in EEOC v. Arabian American Oil
Co., 499 U.S. 244 (1991), seriously undercuts the Solicitor
General's position. The Court there dismissed a Title VII.
claim brought by a United States citizen employed abroad
by an American employer. The Solicitor General
acknowledges that the Court there “describes as
‘jurisdictional’ the portion of the definition of ‘employer’
that requires that the defendant be ‘engaged in interstate
commerce.” U.S. Br. 28. But, again citing the dissent in
Hartford Fire, he says that the Court was “referring to
Congress’s ‘legislative jurisdiction’ to regulate interstate
commerce,” and that “nothing in Arabian American Oil Co.
even addresses the courts’ subject matter jurisdiction.” Ibid.
There are two difficulties with this argument.

First, it ignores the fact that no one in Arabian American
Oil questioned Congress's legislative authority to regulate
the employment practices of overseas United States
employers. See 499 U.S. at 248 (“Both parties concede, as
they must, that Congress has the authority to enforce its
laws beyond the territorial boundaries of the United

States”). Second, and more importantly, it ignores the fact
that the Court there, after concluding that Title VII was
categorically inapplicable to United States employers
operating overseas, affirmed the lower courts’ dismissal for
lack of subject matter jurisdiction. See id. at 247. Thus, Arabian
American Oil supports the conclusion that where Title VII
does not reach a defined class of defendants, the courts lack
subject matter jurisdiction to hear claims against those
defendants.

In any event, the substantial constitutional concerns
with an expansive reading of §701(b) point toward a
jurisdictional understanding of the 15-employee
requirement. See also Tomka, 66 F.3d at 1322 (Parker, J.,
dissenting). As the Court explained in Aldinger, “the reach
of the statute conferring jurisdiction should be construed in
light of the scope of the cause of action as to which federal
judicial power has been extended by Congress.” 427 U.S. at
17 (emphasis added).

Il. Reading Title VII's 15-Employee Requirement as a
Threshold Jurisdictional Issue Vindicates
Congress’s Intention to Shield Small Employers
from the Practical Burden and Expense of Title VII
Litigation.

Strong practical considerations further support the
conclusion that § 701(b) is jurisdictional. In particular, this
reading of the statute would vindicate Congress's desire to
spare small employers—including many muw-.icipal
government agencies—the enormous burden and expense
of defending themselves against employment
discrimination claims.

1. As this Court has observed: “the congressional
decision to limit the coverage of [Title VII] to firms with 15
or more employees has its own justification that must be
respected—namely, easing entry into the market and
preserving the competitive position of smaller firms.”

19

Clackamas Gastroenterology Assucs., P.C. v. Wells, 538 U.S. 440,
447 (2003). We urge the Court to read § 703(f)(5) in light of
“the congressional policy underlying [Title VII's exclusion
of small employers].” Zipes, 455 U.S. at 393; see also
Aldinger, 427 U.S. at 17 (“the reach of the statute conferring
jurisdiction should be construed in light of the scope of the
cause of action”).

In their effort to “ preserv[e] the competitive position” of
small entities, members of Congress specifically considered
“the burdens placed upon a small business forced to comply
with federal regulations and defend itself against a Title VII
suit.” Tomka, 66 F.3d at 1314 (emphas.; added). The views
of New Hampshire Senator Norris Cotton are
representative:

In shor* it is all very weli to talk about enforcing
morality; and large industries ercounter no hardship in
handling such matters, for they have teams of lawyers
organized to deal with them.

But Senators should think twice before they vote in
favor of the passage of a bill which would make it
possible for an investigator or a Federal administrative
officer to reach a conclusion, and thus make it
incumbent on the small businessman to carry the case to
the courts if he is to get justice.

110 Cong. Rec. $13092 (1964) (statement of Sen. Cotton). As
the Solicitor General acknowledges, members of Congress
such as Senator Cotton were “concerned that including all
small businesses in the scope of Title VII would impose
bureaucratic and litigation costs that small companies could
not bear.” US. Br. 24 n.4.

Notwithstanding Congress’s desire to protect small-
scale employers, it is an inescapable fact of modern
employment litigation that municipalities and other small
employers often f..ce what Judge Posner has aptly described
as “the potentially crushing expense of mastering the

20

intricacies of the antidiscrimination laws, establishing
procedures to assure compliance, and defending against
suits when efforts at compliance fail.” Clackamas, 538 U.S. at
447 (quoting Papa, 166 F.3d at 940); accord Tomka, 66 F.3d at
1314; Miller v. Maxwell's Int'l Inc., 991 F.2d 583, 587 (9th Cir.
1993). If a small local agency lacks the ability to seek early
dismissal of Title VII suits on the basis that it has fewer than
15 employees —and thus should not be subject to suit at all —
it will incur substantial defense costs in:

° conducting an initial investigation of the allegations;

e retrieving, reviewing, and organizing data for
electronic and written discovery;

® preparing and producing witnesses for depositions;
e drafting summary judgment motions; and
e if necessary, putting on a defense at trial.

These routine tasks in litigation require time, money, and
human resources—all scarce commodities in small
municipal offices operating on tight budgets.

The cost of preparing a defense to a lawsuit is
substantial in any case, but it is even more likely to be
crippling in a Title VII case—the central allegation in which
involves “the elusive factual question of intentional
discrimination.” Burdine, 450 U.S. at 256 n.8. As this Court
observed in Aikens, “[t]}he factual inquiry” into “whether the
defendant intentionally discriminated against the plaintiff”
is “both sensitive and difficult” and typically cannot be
answered by direct evidence. 460 U.S. at 711, 716; see: ibid.
(noting that “[t]here will seldom be ‘eyewitness’ testimony
as to the employer’s mental processes”). Thus, a Title VII
case is almost always based on circumstantial evidence,
requiring inferential arguments and substantial discovery.

Moreover, the plaintiff's burden of proving a prima facie
case under the framework of McDonnell Douglas Corp. v.

21

Green, 411 U.S. 792 (1973), is minimal. Burdine, 450 US. at
253 (describing the burden as “not onerous”); Price
Waterhouse v. Hopkins, 490 U.S. 228, 270 (1989) (O’Connor, J.,
concurring) (describing the prima facie case as “not difficult
to prove”). Courts applying the McDonnell Douglas burden-
shifting analysis routinely leave for the jury questions about
the plaintiffs’ qualifications for particular positions, the
severity and pervasiveness of alleged harassment, and
whether employers’ proffered §nondiscriminatory
justifications for the alleged adverse employment action are
pretextual. One court has described the McDonnell Douglas
framework as “haviing] the objective of defining the
plaintiff's initial prima facie burden as being so minimal that
it is virtually impervious to a motion based on evidentiary
insufficiency.” Henderson v. Jantzen, Inc., 719 P.2d 1322, 1324
(Ore. App. 1986).

Whether or not plaintiff's burden is that minimal, every
federal court of appeals has held that once the plaintiff
establishes a prima facie case under Title VII, summary
judgment is ordinarily inappropriate. See Santiago-Ramos v.
Centennial P.R. Wireless Corp., 217 F.3d 46, 54 (1st Cir. 2000);
Rosen v. Thornburgh, 928 F.2d 528, 533 (2d Cir. 1991);
Marzano v. Computer Sci. Corp., 91 F.3d 497, 509 (3d Cir.
1996); Holmes v. Bevilacqua, 774 F.2d 636, 638 (4th Cir. 1985);
Hayden v. First Nat'l Bank, 595 F.2d 994, 997 (5th Cir. 1979);
Singfield v. Akron Metro. Hous. Auth., 389 F.3d 555, 564 (6th
Cir. 2004); Powers v. Dole, 782 F.2d 689, 694 (7th Cir. 1986);
Crawford v. Runyon, 37 F.3d 1338, 1341 (8th Cir. 1994); Lowe
v. City of Monrovia, 775 F.2d 998, 1009 (9th Cir. 1985); Orr v.
City of Albuquerque, 417 F.3d 1144, 1149-52 (10th Cir. 2005);
Mulhall v. Advance Sec., Inc., 19 F.3d 586, 598 (11th Cir. 1994);
McKenzie v. Sawyer, 684 F.2d 62, 67 (D.C. Cir. 1982). Thus,
once a case reaches the summary judgment stage, it is
difficult for an employer of any size to avoid a trial. Asa
consequence, any municipal government accused of

22

employment discrimination faces the near-certainty of
protracted and burdensome litigation.

2. The burdens of litigation are uniquely harmful to
municipal governments and, ultimately, their constituents.
Municipal governments are obligated to provide critical
public services, and they must meet these obligations with
limited financial resources and intense public scrutiny.
Every dollar spent on litigation is a dollar taken away from
public services. Every hour spent collecting and preparing
information for electronic or written discovery is an kour in
which the municipal government is shorthanded in
responding to citizens’ needs. In short, protracted litigation
often translates into disruptions in public services. The
impact of litigation costs on municipalities is especially
significant given the “fiscal recession” that American cities
continue to face. See generally Michael” A. Pagano &
Christopher Hoene, City Fiscal Conditions in 2004, 20
(National League of Cities 2004).

The costs of litigation also create tremendous pressure
for municipal governments to settle employment
discrimination lawsuits—even those lacking merit.
Reasonable government officials who must consider the
impact of additional litigation costs on the provision of
public services will often opt for settlement simply to avoid
the costs of litigation, even when they are confident that
Title VII does not apply to their offices and even when they
believe that their conduct did not violate the statute. See
Buckhannon Bd. & Care Home, Inc. v. West Va. Dep’t of Health
& Human Res., 532 U.S. 598, 617 (2001) (Scalia, J., concurring)
(noting that defendants might “’abandon{] the fray’ because
the cost of litigation— either financial or in terms of public
relations — would be too great”).

The costs of discovery alone may be sufficient to justify,
as a financial matter, settlement of a meritless claim. As
Justice Breyer has observed: “discovery and discovery-
related judicial proceedings take time, they are expensive,

23

and cost and delay, or threats of cost and delay, can
themselves force parties to settle underlying disputes.” See
Intel Corp. v. Advanced Micro Devices, 124 S. Ct. 2466, 1485
(2004) (Breyer, J., dissenting). At the end of the day, even a
defense verdict may not be worth the candle, since a verdict
in a Title VII case does not come with a refund of time or
money. Merely defending the lawsuit is a burden that a
small municipal government often cannot afford to bear.

3. Treating the mnumerosity requirement as a
jurisdictional element in a Title VII case would frequently
ease the burden of litigation for small-scale employers. If
the numerosity requirement were deemed jurisdictional, the
plaintiff would be required to plead the jurisdictional fact in
his complaint, Kokkonen v. Guardian Life Ins. Co. of Am., 511
U.S. 375, 377 (1994); McNutt v. General Motors Acceptance
Corp., 298 U.S. 178, 182 (1936), subject to Fed. R. Civ. P. 11.
Even if the plaintiff alleged that his employer had at least 15
employees “on information and belief,” the employer could
move for dismissal under Fed. R. Civ. P. 12(b)(1) or the
district court could raise the numerosity issue sua sponte and
order discovery limited to that issue. See United States Catholic
Conference v. Abortion Rights Mobilization, Inc., 487 U.S. 72,
79-80 (1988) (stating that “[ijt is a recognized and
appropriate procedure for a court to limit discovery
proceedings at the outset to a determination of jurisdictional
matters”). Only upon its determination that the employer
had at least 15 employees, and thus was covered by Title VII
at all, would the court need to consider the plaintiff's
substantive allegations.

In most cases, the numerosity question will not require
significant discovery or involve serious controversy. Unlike
the merits issues in a Title VII case, the number of
employees is a matter of readily ascertainable and objective
fact, not a subject of inference or significant testimonial
dispute. “[T]he ultimate touchstone under § 2000e(b) is
whether an employer has employment relationships with 15

24

or more individuals for each working day in 20 or more
weeks during the year in question.” Walters, 519 U.S. at 212.
Under this rule, “all one needs to know about a given
employee for a given year is whether the employee started
or ended employment during that year and, if so, when.”
Id. at 211. One of the virtues of this rule is that it avoids
“turn[ing] the coverage determination into an incredibly
complex and expensive factual inquiry.” Id. at 210.

To be sure, there may be cases at the margins in which
the 15-employee requirement necessitates discovery into
issues such as whether a worker is an “independent
contractor” or an “owner” rather than an employee. But
contrary to the parade of horribles in petitioner's brief (at
27-31), these cases are certain to prove exceptional.

And even if the discovery required -to sort through the
numerosity question occasionally results in a significant
investment of time or a slight delay in reaching the merits,
that is of no great moment. The plaintiff must satisfy the 15-
employee requirement regardless of whether it is
jurisdictional, and thus the only question is when she will be
required to make that showing. But for the employer with
fewer than 15 employees—who is spared the expense of
additional, unrelated discovery in a suit that the plaintiff is
not entitled to bring against him—the opportunity to
address numerosity at the outset of the case could result in
significant savings (or perhaps preservation of the business).
In short, given its logical priority in any Title VII case and
the relative ease of analysis, no sound policy reason favors
treating the numerosity requirement as an element of the
Title VII claim rather than an antecedent jurisdictional
element.

Congress plainly intended to shield small employers,
including small municipal employers, from the burdens of
Title Vil litigation. Those burdens are significant—
especially for municipal agencies operating in small offices
with modest financial resources—and they are largely

25

unavoidable absent an opportunity to have such cases
resolved at an early stage. Treating Title VII's 15-employee
requirement as a jurisdictional prerequisite vindicates the
clear purpose of the statute and frees small-scale municipal
governments to do the critical work that they are charged by
their citizens to do, unencumbered by the burden of
litigation under a statute that grants them “complete
immunity.” Hishon, 467 U.S. at 78.

CONCLUSION

For the foregoing reasons, the judgment of the Fifth
Circuit should be affirmed.

Respectfully submitted.
HENRY W. UNDERHILL, JR. GENE C.SCHAERR
LANI L. WILLIAMS Counsel of Record
International Municipal STEFFEN N. JOHNSON
Lawyers Association JEFFREY M. ANDERSON
1110 Vermont Ave., N.W. Winston & Strawn LLP
Suite 200 1700 K Street, N.W.
Washington, DC 20005 Washington, D.C. 20006
(202) 466-5424 (202) 282-5000
LINDA T. COBERLY
Winston & Strawn LLP
35 West Wacker Drive
Chicago, Illinois 60601
(312) 558-5600

Counsel for Amicus Curiae

OCTOBER 2005

et

tip Opinion) OCTOBER TERM, 2005 1

Syllabus

NOTE: Where it is Gastble, a syllabus (headnote) will be released, as is
being done in connection with this-case. at the time the opinion is issued.
The syllabus constututes no of the opimon of the Court but has been
wrepared by the Reporter of Decisions for the convemence of the reader.
Bee United States vy. Detroit Timber & Lumber Co., 200 U8. 321, 337.

SUPREME COURT OF THE UNITED STATES

Syllabus

ARBAUGH v. Y & H CORP. DBA THE MOONLIGHT
CAFE

CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR
THE FIFTH CIRCUIT

No. 04-944. Argued January 11, 2006—Decided February 22, 2006

Title Vil of the Civil Rights Act of 1964 makes it unlawful for “an em-
ployer ... to discriminate against any [employee] with respect to .. .
sex,” 42 U.S. C. §2000e—2(a)(1), and defines “employer” as “a person
... Who has fifteen or more employees,” §2000e(b). The Act's jurisdic-
tional provision empowers federal courts to adjudicate civil actions
“brought under” Title VII. §2000e—5(1)(3). Title VII actions also fit
within the Judicial Code’s grant of subject-matter jurisdiction to fed-
eral courts over actions “arising under’ federal law. 28 U.S.C.
§1331. At the ime~Title VIT was enacted, §1331 contained a $10,000
amount-in-controversy threshold, which left Title VII claims below
that amount uncovered. Section 2000e—5(f)(3) assured that the
amount-in-controversy limitation would not impede a Title VII com-
plainant’s access to a federal forum. Since 1980, when Congress
amended §1331 to eliminate the amount-in-controversy threshold,
§2000e—5(f)(3) has served simply to underscore Congress intention to
provide a federal forum for Title VI! claims. Because Congress has
also authorized federal courts to exercise “supplemental” jurisdiction
over state-law claims linked to a federal claim, 28 U.S. C. §1367, Ti-
tle VII plaintiffs may pursue complete relief in federal court.

The objection that-a federal court lacks subject-matter jurtsdiction,
see Fed. Rule Civ. Proce. 12(b)(). may be raised at any stage in the
litigation, even after trial and the entry of judgment, Rule 12(h)().
See Aontrick v. Ryan, 540 U.S. 443, 455. By contrast, the objection
that a complaint “fail[s] to state a claim upon which relief can be
granted,” Rule 12(b)(6), endures only up to, not beyond, trial on the
merits, Rule 12¢h)(2).

Petitioner Arbaugh sued her former employer, respondent Y&H

ARBAUGH v. Y & H CORP.

Syllabus

Corporation, in Federal District Court, charging sexual harassment
in violation of Title VIl and asserting related state-law claims. The
case was tried to a jury, which returned a verdict for Arbaugh. After
the court entered judgment on that verdict, Y&H moved to dismiss
the entire action for want of federal subject-matter jurisdiction, as-
serting, for the first time, that it had fewer than 15 employees on its
payroll and therefore was not amenable to suit under Title VII. Al-
though recognizing the unfairness and waste of judicial resources
that granting the motion would entail, the District Court, citing Fed-
eral Rule 12(h)(3), considered itself obliged to do so because it be-
lieved the 15-or-more-employees requirement to be jurisdictional. It
therefore vacated its prior judgment and dismissed Arbaugh’s Title
VIL claim with prejudice and her state-law claims without prejudice.
The Fifth Circuit affirmed based on its precedent holding that unless
the employee-numerosity requirement is met, federal-court subject-
matter jurisdiction does not exist.

Held: Title VITs numerical threshold does not circumscribe federal-

court subject-matter jurisdiction. Instead, the employee-numerosity
requirement relates to the substantive adequacy of Arbaugh’s Title
VII claim, and therefore could not be raised defensively late in the
lawsuit, i.e., after Y&H had failed to assert the objection prior to the
close of trial on the merits. The basic statutory grants of federal-
court subject-matter jurisdiction are contained in 28 U.S. C. §1331,
which provides for “[fJederal-question” jurisdiction, and §1332, which
provides for “[dliversity of citizenship” jurisdiction. A plaintiff prop-
erly invokes §1331 jurisdiction when she pleads a colorable claim
“arising under” the Federal Constitution or laws. See Bell v. Hood,
327 U.S. 678, 681-685. She invokes §1332 jurisdiction when she pre-
sents a claim between parties of diverse citizenship that exceeds the
required jurisdictional amount, currently $75,000. See §1332(a). Ar-
baugh invoked federal-question jurisdiction under §1331, but her
case “arisles]” under a federal law, Title VII, that specifies, as a pre-
requisite to its application, the existence of a particular fact, Le., 15
or more employees. The Court resolves the question whether that
fact is “jurisdictional” or relates to the “merits” of a Title VII claim
mindful of the consequences of typing the 15-employee threshold a
determinant of subject-matter jurisdiction, rather than an element of
Arbaugh’s claim for relief. First, “subject-matter jurisdiction. be-
cause it involves the court's power to hear a case, can never be for-
feited or waived.” United States v. Cotton, 535 U. S. 625, 630. More-
over, courts, including this Court, have an independent obligation to
determine whether subject-matter jurisdiction exists. even in the ab-
sence of a challenge from any party. Ruhrgas AG v. Marathon Oil
Co., 526 U.S. 574, 583. Nothing in Title VII's text indicates that

Cite as: 460.8. (2006) 3

Syllabus

Congress intended courts, on their own motion, to assure that the
employee-numerosity requirement is met. Second, in some instances,
if subject-matter jurisdiction turns on contested facts, the trial judge
may be authorized to review the evidence and resolve the dispute on
her own. If satisfaction of an essential element of a claim is at issue,
however, the jury is the proper trier of contested facts. Reeves v.
Sanderson Plumbing Products, Inc., 580 U.S. 133, 150-151. Third,
when a federal court concludes that it lacks subject-matter jurisdic-
tion, the complaint must be dismissed in its entirety. Thus, the trial

~ court below dismissed, along with the Title VII claim, pendent state-
law claims fully tried by a jury and determined on the merits. In
contrast, when a court grants a motion to dismiss for failure to state
a federal claim, the court generally retains discretion to exercise sup-
plemental jurisdiction, pursuant to §1367, over pendent state-law
claims.

While Congress could make the employee-numerosity requirement
“jurisdictional” if it so chose, neither §1331 nor Title VIT's jurisdic-
tional provision, 42 U.S. C. §2000e—5(f)(3), specifies any threshold
ingredient akin to 28 U.S. C. §1332’s monetary floor. Instead, the
15-employee threshold appears in a separate provision that “does not
speak in jurisdictional terms or refer in any way to the jurisdiction of
the district courts.” Zipes v. Trans World Airlines, Inc., 455 U.S. 385,
394. Given the unfairness and waste of judicial resources entailed in
tying the employee-numerosity requirement to subject-matter juris-
diction, the sounder course is to refrain from constricting §1331 or
§2000e—A(f)(3), and to leave the ball in Congress’ court. If the Legis-
lature clearly states that a threshold limitation on a statute's scope
shall count as jurisdictional, then courts and litigants will be duly in-
structed and will not be left to wrestle with the issue. But when
Congress does not rank a statutory limitation on coverage as jurisdic-
tional, courts should treat the restriction as nonjurisdictional in
character. Applying that readily administrable bright line here
yields the holding that Title VII's 15-employee threshold is an ele-
ment of a plaintiffs claim for relief, not a jurisdictional issue. Pp. 8—
15.

380 F. 3d 219, reversed and remanded.
GINSBURG, J., delivered the opinion of the Court, in which all other

Members joined, except ALITO, J., who took no part in the consideration
or decision of the case.

Cite as: HE U.S. (2006) 1

Opinion.of the Court .

NOTICE> This opinion is subject to formal revision before publication im the -
prehim print of the United States wis Readers are requested to
notify the Reporter of Decisions, Supreme Court of the United States. Wash-
ington, D.C. 20043, of any t or other formal errors, in order
that corrections may be made before the preliminary print goes to press.

SUPREME COURT OF THE UNITED STATES

No. 04-944

JENIFER ARBAUGH, PETITIONER ev. Y & H COR-
PORATION, DBA THE MOONLIGHT CAFE

ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF
APPEALS FOR THE FIFTH CIRCUIT

[February 22, 2006]

JUSTICE GINSBURG delivered the opinion of the Court.

This case concerns the distinction between two some-
times confused or conflated concepts: federal-court “sub-
ject-matter” jurisdiction over a controversy; and the essen-
tial ingredients of a federal claim for relief. Title VII of
the Civil Rights Act of 1964 makes it unlawful “for an
employer .. . to discriminate,” inter alia, on the basis of
sex. 42 U.S.C. $2000e—2(a)(1). The Act's jurisdictional
provision empowers federal courts to adjudicate civil
actions “brought under” Title VIIl. §2000e—5(D(3). Cover-
ing a broader field, the Judicial Code gives federal courts
subject-matter jurisdiction over all civil actions “arising
under” the laws of the United States. 28 U.S. C. §1331.
Title VII actions fit that description. In a provision defin-
ing 13 terms used in Title VII, 42 U.S. C. §2000e, Con-
gress limited the definition of “employer” to include only
those having “fifteen or more employees,” §2000e(b). The
question here presented is whether the numerical qualifi-
cation contained in Title VII's definition of “employer”
affects federal-court subject-matter jurisdiction or, in-
stead, delineates a substantive ingredient of a Title VII

2 ARBAOGH v. Y & H CORP.

Opinion of the Court

claim for relief.

The question arises in this context. Jenifer Arbaugh,
plaintiff below, pétitioner here, brought a Title VII action
in federal court against her former employer, defendant-
respondent Y&H Corporation (hereinafter Y&H), charging
sexual harassment. The case was tried to a jury, which
returned a verdict for Arbaugh in the total amount of
~ $40,000. Two weeks after the trial court entered judgment.
on the jury verdict, Y&H moved to dismiss the entire
action for want of federal subject-matter jurisdiction. For
the first time in the litigation, Y&H asserted that it had
fewer than 15 employees on its payroll and therefore was
not amenable to suit under Title VII.

Although recognizing that it was “unfair and a waste of
judicial resources” to grant the motion to dismiss, App. to
Pet. for Cert. 47, the trial court considered itself obliged to
do so because it believed that the 15-or-more-employees
requirement was jurisdictional. We reject that categoriza-
tion and hold that the numerical threshold does not cir-
cumscribe federal-court. subject-matter jurisdiction. | In-
stead, the employee-numerosity requirement relates to the
substantive adequacy of Arbaugh’s Title VII claim, and
therefore could not be raised defensively late in the law-
suit, t.e., after Y&H had failed to assert the objection prior
to the close of trial on the merits.

l

We set out below statutory provisions and rules that
bear on this case. Title VII makes it “an unlawful em-
ployment practice for an employer ... to fail or refuse to
hire or to discharge any individual, or otherwise to dis-
criminate against any individual with respect to his com-
pensation, terms, conditions, or privileges of employment,
because of such individual's race, color, religion, sex, or
national origin.” 42 U.S. C. §2000e—2(a)(1). To spare very
small businesses from Title VII liability, Congress pro-

Cite as: 446U.8.___ (2006) 3

Opinion of the Court
vided that:

“[t}he term ‘employer’ means a person engaged in an
industry affecting commerce who has fifteen or more
employees for each working day in each of twenty or
more calendar weeks in the current or preceding cal-
endar year, and any agent of such a person ....”

§2000e().!

This employee-numerosity requirement? appears in a
section headed “Definitions,” §2000e, which also prescribes
the meaning, for Title VII purposes, of 12 other terms used
in the Act.*

Congress has broadly authorized the federal courts to
exercise subject-matter jurisdiction over “all civil actions
arising under the Constitution, laws, or treaties of the
United States.” 28 U.S.C. $1331. Title VII surely is a
“la[w] of the United States.” Ibid. In 1964, however,
when Title VII was enacted, §1331’s umbrella provision for
federal-question jurisdiction contained an amount-in-
controversy limitation: Claims could not be brought under
§1331 unless the amount in controversy exceeded $10,000.
See §1331(a) (1964 ed.). Title VII, framed in that light,
assured that the amount-in-controversy limitation would
not impede an employment-ciscrimination complainant's

'The same provision further states that the term “employer” does not
include the United States, corporations wholly owned by the United
States, Indian Tribes, certain departments and agencies of the District
of Columbia, or tax-exempt “bona fide private membership clubjs}’
(other than labor organizations). §2000e(b).

“Congress originally prescribed a 25-or-more-employee threshold.
Civil Rights Act of 1964, §701, 78 Stat. 253, but lowered the minimum
number of employees to 15 in the Equal K mployment Opportunity Act
of 1972, §2. 86 Stat. 103.

“The other terms defined in §2000e are: “person,” “employment
agency, “labor organization. “employee.” “commerce.” “industry
affecting commerce,” “State.” “religion.” “because of sex,” “complaining
party.” “demonstrates, and “respondent.”

4 ARBAUGH v. Y & H CORP. —

os Opinion of the Court

access to a federal forum. The Act thus contains its own
jurisdiction-conferring provision, which reads:
“Each United States district court and each United
States court of a place subject to the jurisdiction of the
- United States shall have jurisdiction of actions
brought under this cen oI " 42 U.S.C. §20000-
5(f)(3).4

Congress amended 28 U.S. C. §1331 in 1980 to eliminate
the amount-in-controversy threshold. See Federal Ques-
tion Jurisdictional Amendments Act of 1980, §2, 94 Stat.
2369. Since that time, Title VII's own jurisdictional provi-
sion, 42 U.S.C. §2000e—5()(3), has served simply to
underscore Congress’ intention to provide a federal forum
for the adjudication of Title VII claims. See Brief for
United States as Amicus Curiae 13; Tr. of Oral Arg. 4.

We note, too, that, under 28 U.S.C. §1367, federal
courts may exercise “supplemental” jur.sdiction over state-
law claims linked to a claim based on federal law. Plain-
tiffs suing under Title VII may avail themselves of the
opportunity §1367 provides to pursue complete relief in a
federal-court lawsuit. Arbaugh did so in the instant case
by adding to her federal complaint pendent claims arising
under state law that would*not independently qualify for

*Title VII contains a separate jurisdictional provision, 42 U.S. C.
§2000e—6(b), authorizing suits by the Government to enjoin “pattern or
practice” discrimination.

* Section 1367(a) states: “Except as provided in subsections (b) and (c)
or as expressly provided otherwise by Federal statute, in any civil
action of which the district courts have original jurisdiction, the district
courts shall have supplemental jurisdiction-over all other claims that
are so related to claims in the action within such original jurisdiction
that they form part of the same case or controversy under Article IT of
the United States Constitution. Such supplemental jurisdiction shall
include claims that involve the joinder or intervention of additional
parties.

SaaS mE

> >

Cite as: 546U.S.___ (2006) 5
Opinion of the Court
federal-court adjudication. :

The objection that a federal court lacks subject-matter
jurisdiction, see Fed. Rule Civ. Proc. 12(b)(1), may be
raised by a party, or by a court on its own initiative, at any
stage in the litigation, even after trial and the entry of
judgment. Rule 12(h)(3) instructs: “Whenever it appears
by suggestion of the parties or otherwise that the court
lacks jurisdiction of the subject matter, the court shall
dismiss the action.” See Aontrick v. Ryan, 540 U.S. 443,
455 (2004). By contrast, the dbjection that a complaint
“fail[s] to state a claim upon which relief can be granted,”
Rule 12(b)(6), may not be asserted post trial. Under Rule
12(h)(2), that objection endures up to, but not beyond, trial
on the merits: “A defense of failure to state a claim upon
which relief can be granted . .. may be made in any plead-
ing ... or by motion for judgment on the pleadings, or at
the trial on the merits.” Cf. Aontrick, 540 U.S., at 459.

From May 2000 through February 2001, Jenifer Ar-
baugh worked as a bartender and waitress at the
Moonlight Cafe, a New Orleans restaurant owned and
operated by Y&H. Arbaugh alleged that Yalcin Hatipoglu,
one of the company’s owners, sexually harassed her and
precipitated her constructive discharge.° In November —
2001, Arbaugh filed suit against Y&H in the United States
District Court for the Eastern District of Louisiana. Her
complaint asserted claims under Title VII and Louisiana
law. App. to Pet. for Cert. 1-2.

Arbaugh’s pleadings alleged that her federal claim
“arlolse under Title VII" and that the Federal District

®See Pennsylvania State Police v. Suders, 542 U.S.129,. 147 (2004)
(constructive discharge compensable under Title VII includes an em-
ployee's departure due to sexual harassment that renders “working
conditions so intolerable that a reasonable person would have felt com-
pelled to resign’).

6 ARBAUGH v. Y & H CORP.
Opinion of the Court

Court had jurisdiction over this claim under §1331 plus
supplemental! jurisdiction over her state-law claims under
§1367. Record in No. 01-3376 (ED La.), Doc. 3, p. 1
(Amended Complaint). Y&H’s responsive pleadings ad-
mitted Arbaugh’s “jurisdictional” allegations but denied
her contentions on the merits. /d., Doc. 4, p. 1 (Answer fo
Complaint). The pretrial order submitted and signed by
the parties, and later subscribed by the presiding judge,
reiterated that the court was “vested with jurisdiction over
|Arbaugh’s Title VII claim] pursuant to 28 L. S. C. §1331,”
and “ha[d] supplemental jurisdiction over [her] state law
claims pursuant to 28 U.S. C. §1367.” Id., Doc. 19, p. 2.
The order listed “Uncontested Material Facts,” including:
“Plaintiff was employed as a waitress/artender at the
Moonlight for Defendants from May, 2000 through Febru-
ary 10, 2001 when she terminated her employment with
the company.” /d., p. 3. It did not list among “Contested
Issues of Fact” or “Contested Legal Issues” the question
whether Y&H had the requisite number of employees
under 42 U.S. C. §2000e(b). Record, Doc. 19, pp. 4—5. Nor
was the issue raised at any other point pretrial or at trial.

The parties consented to trial before a Magistrate
Judge. See 28 U.S. C. §636(c). After a two-day trial, the
jury found that Arbaugh had been sexually Harassed and
constructively discharged in violation of Title VII and
Louisiana antidiscrimination law. The verdict awarded
Arbaugh $5,000 in backpay, $5,000 in compensatory dam-
ages, and $30,000 in punitive damages. The trial court
entered judgment for Arbaugh on November 5, 2002.

Two weeks later, Y&II filed a motion under Federai
Rule 12(h)(3) to dismiss Arbaugh’s complaint for lack of
subject-matter jurisdiction. Record, Doc. 44. As sole
ground for the motion, Y&H alleged, for the first time in
the proceedings, that it “did not employ fifteen or more
employees [during the relevant period] and thus is not an
employer for Title VII purposes.” /d., p. 2 (Memorandum

—

Cite as: 446.58. __ (2006) 7

Opinion of the Court

in Support of Rule 12(h)(3) Motion to Dismiss for Lack of
Subject Matter Jurisdiction). The trial court commented
that “li]t is unfair and a waste of judicial resources to
permit [Y&H] to admit Arbaugh’s allegations of jurisdic-
tion, try the case for two days and then assert a lack of
subject matter jurisdiction in response to an adverse jury
verdict.” App. to Pet. for Cert. 47. Nevertheless, reciting
the text of Rule 12(h)(3), see supra, at 5, the trial court
allowed Y&H to plead that it did not qualify as an “em-
ployer” under Title VII's definition of that term. App. to
Pet. for Cert. 47-48; see supra, at 3.

Discovery ensued. The dispute over the employee count
turned on the employment status of Y&H’s eight drivers,
engaged to make deliveries for the restaurant, and the
company’s four owners (the Moonlight Cafe’s two manag-
ers and their shareholder spouses), As the trial court
noted, “[i]f either the delivery drivers or the four owners
are counted with the persons shown on the payroll jour-
nals, then Y&H employed fifteen or more persons for the
requisite time.” App. to Pet. for Cert. 27. After reviewing
the parties’ submissions, however, the trial court con-
cluded that neither the delivery drivers nor the owner-
managers nor their shareholder spouses qualified as “em-
ployees” for Title VII purposes. /d., at 32-43. Based on
that determination, the trial court vacated its prior judg-
ment in favor of Arbaugh, dismissed her Title VII claim
with prejudice, and her state-law claims without preju-
dice. Id., at 23.

The Court. of Appeals for the Fifth Circuit affirmed. 380
F. 3d 219 (2004). Bound by its prior decisions, the Court
of Appeals held that a defendant's “failure to qualify as an
‘employer’ under Title VII deprives a district court of
subject matter jurisdiction.” /d., at 224 (citing, e.g., Du-
mas v. Mt. Vernon, 612 F. 2d 974, 980 (1980)). Dismissal
for want of subject-matter jurisdiction was proper, the
Court of Appeals ruled, for the record warranted the con-

8 ARBAUGH v. Y & H CORP. ~

Opinion of the Court

clusion that Y&H's delivery drivers, its owner-managers,
and their shareholder wives were not “employees” for Title
VII purposes, 380 F. 3d, at 225-230, and it was undis-
puted that Y&H “did not employ the requisite 15 employ-
ees without the inclusion of” those persons, id., at 231.

We granted certiorari, 544 U.S. 1031 (2005), to resolve
conflicting opinions in Courts of Appeals on the question
whether Title VII’s employee-numerosity requirement, 42
U.S. C. §2000e(b), is jurisdictional or simply an element of
a plaintiffs claim for relief. Compare, e.g., 380 F. 3d, at
223-225 (Title VII’s employee-numerosity requirement is
jurisdictional), and Armbruster v. Quinn, 711 F. 2d 1332,
1335 (CAG 1983) (same), with, e.g., Da Silva v. Kinsho
International Corp., 229 F. 3d 358, 361-866 (CA2 2000)
(Title VII’s employee-numerosity requirement is not juris-
dictional); Nesbit v. Gears Unlimited, Inc., 347 F. 372, _
76-83 (CA3 2003) (same); EEOC v. St. Francis Xavier
Parochial School, 117 F.3d 621, 623-624 (CADC 1997)
(Americans with Disabilities Act’s employee-numerosity
requirement, 42 U.S.C. §12111(5)(A), resembling Title
VII's requirement, is not jurisdictional).

If

“Jurisdiction,” this Court has observed, “is a word of
many, too many, meanings.” Sleel Co. v. Citizens for Better
Environment, 523 U.S. 838, 90 (1998) (internal quotation
marks omitted). This Court, no less than other courts, has
sometimes been profligate in its use of the term. For
example, this Court and others have occasionally de-
scribed a nonextendable time limit as “mandatory and
jurisdictional.” See, e.g., United States v. Robinson, 361
U.S. 220, 229 (1960). But in recent decisions, we have
clarified that time prescriptions, however emphatic, “are
not properly typed ‘jurisdictional.’” Scarborough v. Prin-
cipi, 541 U.S. 401, 414 (2004); accord Eberhart v. United
States, 546 U.S. __, __ (2005) (per curiam) (slip op., at 4—

Cite as: 546 U.S. __ (2006) 9

Opinion of the Court

7); Kontrick, 540 U.S., at 454-455. See also Carlisle v.
United States, 517 U.S. 416, 434-435 (1996) (GIN® 3URG, J.,
concurring).

The dispute now before us concerns the proper classifi-
cation of Title VII's statutory limitation of covered em-
ployers to those with 15 or more employees. If the limita-
tion conditions subject-matter jurisdiction, as the lower
courts held it did, then a conclusion that Y&H had fewer
than 15 employees would require erasure of the judgment
for Arbaugh entered on the jury verdict. But if the lower
courts’ subject-matter jurisdiction characterization is
incorrect, and the issue, instead, concerns the merits of
Arbaugh’s case, then Y&H raised the employee-
numerosity requirement too late. Its pretrial stipulations,
see supra, at 6, and its failure to speak to the issue prior
to the conclusion of the trial on the merits, see Fed. Rule

viv. Proc. 12(h)(2), supra, at 5, would preclude vacation of
the $40,000 judgment in Arbaugh’s favor.

On the subject-matter jurisdiction/ingredient-of-claim-
for-relief dichotomy, this Court and others have been less
than meticulous. “Subject matter jurisdiction in federal-
question cases is sometimes erroneously conflated with a
plaintiffs need and ability to prove the defendant bound
by the federal law asserted as the predicate for relief—a
merits-related determination.” 2 J. Moore et al., Moore’s
Federal Practice §12.30[1], p. 12-36.1 (8d ed. 2005) (here-
inafter Moore). Judicial opinions, the Second Circuit
incisively observed, “often obscure the issue by stating
that the court is dismissing ‘for lack of jurisdiction’ when
some threshold fact has not been established, without
explicitly considering whether the dismissal shouid be for
lack of subject matter jurisdiction or for failure to state a
claim.” Da Silva, 229 F.3d, at 361. We have described
such unrefined dispositions as “drive-by jurisdictional
rulings” that should be accorded “no precedential effect”
on the question whether the federal court had authority to

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385016_0065%3A11. Public record. Not legal advice.