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United States v. South Dakota Department of Social Services

United States District Court, D. South Dakota, Western Division

September 25, 2018

UNITED STATES OF AMERICA, Plaintiff,
v.
THE SOUTH DAKOTA DEPARTMENT OF SOCIAL SERVICES, Defendant.

          REDACTED ORDER

          JEFFREY L. VIKEN CHIEF JUDGE

         INTRODUCTION

         The United States filed this action against the South Dakota Department of Social Services (“DSS”) alleging violations of the provisions of Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq. (“Title VII”). (Docket 26 at p. 1). DSS filed an answer denying it violated Title VII. (Docket 27). DSS timely filed a motion for summary judgment, together with its statement of undisputed material facts, two affidavits with supporting exhibits and a legal memorandum. (Dockets 41-44 & 49). The United States filed a response to defendant's statement of material facts, an affidavit with supporting exhibits and a brief in resistance to defendant's motion. (Dockets 53-55). DSS filed a reply brief in support of its motion for summary judgment. (Docket 57).

         On the same day, the United States timely filed a motion for partial summary judgment, together with a statement of undisputed material facts, an affidavit and a legal memorandum. (Dockets 45-48). DSS filed a response to plaintiff's statement of material facts, an affidavit with supporting exhibits and a legal memorandum. (Dockets 50-52). Plaintiff filed a reply brief in support of its motion for partial summary judgment. (Docket 56).

         Based on the analysis in this order, defendant's motion for summary judgment is denied and plaintiff's motion for partial summary judgment is granted.

         PROCEDURAL HISTORY

         In 2015, the United States filed the complaint against DSS under Title VII. (Docket 1). In the fall of 2016, the United States filed an amended complaint. (Docket 26). Count I of the amended complaint alleges DSS violated Title VII by individual race discrimination against Cedric Goodman, a Native American, and other similarly situated Native Americans by denying them, because of their race, employment as a Specialist[1] at the DSS Office at Pine Ridge, South Dakota, during 2007 through 2013. Id. at pp. 4-7. Count II of the amended complaint alleges DSS violated Title VII by engaging in a pattern or practice of intentional discrimination against Native Americans by denying them, because of their race, employment as a Specialist at the DSS Pine Ridge Office during 2007 through 2013. Id. at pp. 4-7 & 9.

         DSS denied it discriminated either against individual Native American applicants for a Specialist position or through a pattern or practice of racial discrimination. (Docket 27). Among other defenses, DSS asserted with respect to Mr. Goodman, and all other allegedly similar applicants, its “policies, practices and decisions . . . were at all times based on legitimate, nondiscriminatory business reasons.” Id. at p. 8. DSS further alleged its “actions . . . were at all times reasonable and undertaken in good faith and consistent with applicable statutes and enforceable regulations.” Id. at pp. 8-9.

         The court bifurcated discovery into two stages. (Docket 16 at p.1). The first stage focused “on (a) the liability, if any, of the [DSS] for the plaintiff's pattern-or-practice claim; (b) any defenses asserted by DSS that apply to the issues to be tried in Stage I; and (c) the relief, if any, including prospective injunctive relief ordered by the court on that claim.” Id. A subsequent order modified the discovery timetable and established a deadline for submission of Stage I motions. (Docket 40).

         DSS's motion for summary judgment asserts the United States “cannot meet its burden to show a prima facie case that DSS intentionally engaged in a pattern-or-practice of discrimination.” (Docket 41 at p. 1). The United States moves for “partial summary judgment on its prima facie case that [DSS] engaged in a pattern or practice of intentional discrimination against Native Americans when hiring Specialists at its Pine Ridge office from 2007 through 2013.” (Docker 45 at p. 1). Both of the parties' motions for summary judgment will be separately addressed.

         STANDARD OF REVIEW

         Under Fed.R.Civ.P. 56(a), a movant is entitled to summary judgment if the movant can “show that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). Once the moving party meets its burden, the nonmoving party may not rest on the allegations or denials in the pleadings, but rather must produce affirmative evidence setting forth specific facts showing that a genuine issue of material fact exists. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 256 (1986). Only disputes over facts that might affect the outcome of the case under the governing substantive law will properly preclude summary judgment. Id. at p. 248. “[T]he mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material fact.” Id. at 247-48 (emphasis in original).

         If a dispute about a material fact is genuine, that is, if the evidence is such that a reasonable jury could return a verdict for the nonmoving party, then summary judgment is not appropriate. Id. However, the moving party is entitled to judgment as a matter of law if the nonmoving party failed to “make a sufficient showing on an essential element of her case with respect to which she has the burden of proof.” Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). In such a case, “there can be ‘no genuine issue as to any material fact,' since a complete failure of proof concerning an essential element of the nonmoving party's case necessarily renders all other facts immaterial.” Id. at p. 323.

         In determining whether summary judgment should issue, the facts and inferences from those facts must be viewed in the light most favorable to the nonmoving party. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587-88 (1986). The court is permitted to assume facts as true so long as they are not blatantly contradicted by the record and make all reasonable inferences in favor of the non-moving party regarding any unresolved factual questions. Brown v. Fortner, 518 F.3d 552, 557-58 (8th Cir. 2008). The key inquiry is “whether the evidence presents a sufficient disagreement to require submission to a jury or whether it is so one-sided that one party must prevail as a matter of law.” Anderson, 477 U.S. at pp. 251-52.

         TITLE VII

         Title VII makes it unlawful for employers “to fail or 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 U.S.C. § 2000e-2(a)(1). “All disparate-treatment claims brought under Title VII turn on one basic issue: whether the employer intentionally treated ‘some people less favorably than others because of their race, color, religion, sex, or national origin.' ” Craik v. Minnesota State University Board, 731 F.2d 465, 468-69 (8th Cir. 1984) (citing International Brotherhood of Teamsters v. United States, 431 U.S. 324, 335 n.15 (1977)). As indicated above, Stage I of the case only addresses the pattern or practice claim of the United States. For plaintiff's pattern or practice disparate treatment claims, the court employs the burden-shifting framework outlined in Teamsters. “The plaintiff in a pattern-or-practice action is the Government, and its initial burden is to demonstrate that unlawful discrimination has been a regular procedure or policy followed by an employer. . . .” Teamsters, 431 U.S. at 360. “At the initial, ‘liability' stage of a pattern-or-practice suit the Government is not required to offer evidence that each person for whom it will ultimately seek relief was a victim of the employer's discriminatory policy. Its burden is to establish a prima facie case that such a policy existed.” Id. “Establishment of the prima facie case in effect creates a presumption that the employer unlawfully discriminated against the employee.” Craik, 731 F.2d at 469.

         “Normally, the plaintiff will produce statistical evidence showing disparities between similarly situated protected and unprotected employees with respect to hiring . . . supplemented with other evidence, such as testimony about specific incidents of discrimination.” Craik, 731 F.2d at 470. “[B]ecause it alleged a systemwide pattern or practice of resistance to the full enjoyment of Title VII rights, the Government ultimately [has] to prove more than the mere occurrence of isolated or ‘accidental' or sporadic discriminatory acts. It had to establish by a preponderance of the evidence that racial discrimination was the [defendant's] standard operating procedure the regular rather than the unusual practice.” Teamsters, 431 U.S. at 336. “[I]t [is] unmistakably clear that ‘(s)tatistical analyses have served and will continue to serve an important role' in cases in which the existence of discrimination is a disputed issue.” Id. at 339 (citing Mayor of Philadelphia v. Educational Equality League, 415 U.S. 605, 620 (1974)). Statistics are competent evidence for proving employment discrimination. Id. In recognizing this evidentiary option, the Supreme Court “caution[ed] only that statistics are not irrefutable; they come in infinite variety and, like any other kind of evidence, they may be rebutted. In short, their usefulness depends on all of the surrounding facts and circumstances.” Id. at 340.

         “To be legally sufficient, the [government's] statistical evidence ‘must show a disparity of treatment, eliminate the most common nondiscriminatory explanations of the disparity, and thus permit the inference that, absent other explanation, the disparity more likely than not resulted from illegal discrimination.' ” Morgan v. United Parcel Service of America, Inc., 380 F.3d 459, 463-64 (8th Cir. 2004) (citing Hervey v. Little Rock, 787 F.2d 1223, 1228 (8th Cir. 1986) (internal quotation omitted). “Where gross statistical disparities can be shown, they alone may in a proper case constitute prima facie proof of a pattern or practice of discrimination.” Hazelwood School District v. United States, 433 U.S. 299, 307-08 (1977). The government's evidence of individual intentional discrimination may be considered to supplement plaintiff's statistical evidence as anecdotal “evidence would bring the cold No. convincingly to life.” Morgan, 380 F.3d at 471 (citing Teamsters, 431 U.S. at 339).

         If the government makes out a prima facie case, “[t]he burden then shifts to the employer to defeat the prima facie showing of a pattern or practice by demonstrating that the Government's proof is either inaccurate or insignificant. An employer might show, for example, . . . that during the period it is alleged to have pursued a discriminatory policy it made too few employment decisions to justify the inference that it had engaged in a regular practice of discrimination.” Teamsters, 431 U.S. at 360. “The defendant, in rebuttal, will attempt to show that the plaintiff's ‘proof is either inaccurate or insignificant.' ” Craik, 731 F.2d at 470 (citing Teamsters, 431 U.S. at 360).

         “If the defendant satisfies its burden of production, the trier of fact must then determine, by a preponderance of the evidence, whether the employer engaged in a pattern or practice of intentional discrimination.” Reynolds v. Barrett, 685 F.3d 193, 203 (2d Cir. 2012). “If an employer fails to rebut the inference that arises from the Government's prima facie case, a trial court may then conclude that a violation has occurred and determine the appropriate remedy. Without any further evidence from the Government, a court's finding of a pattern or practice justifies an award of prospective relief.” Teamsters, 431 U.S. at 361.

         UNDISPUTED MATERIAL FACTS RELATED TO BOTH MOTIONS

         Where a statement of fact is admitted by the opposing party, the court will only reference the initiating document. For purposes of resolving both parties' motions for summary judgment, the following material facts are undisputed.

         DSS is a governmental agency created pursuant to the laws of the state of South Dakota. (Docket 26 at p. 2). DSS has offices throughout South Dakota, including an office on the Pine Ridge Reservation, which primarily serves Native Americans living on the reservation. Id. The Pine Ridge Reservation is home to the Oglala Lakota Sioux Tribe. (Docket 47 ¶ 1). About 90 percent of the Reservation's population self-identified as Native American in the 2010 decennial census and most of the residents are members of the Tribe. Id.

         The DSS Pine Ridge Office has approximately thirty to forty staff members at a given time, including the regional manager, supervisors, lead Benefits Specialist, Benefits Specialists, Employments Specialists, ASA Specialists, and clerical positions such as secretaries. (Docket 49 ¶ 12). Each Specialist reports to a supervisor. Id. ¶ 24. During the relevant time period, the DSS Pine Ridge Office had one Supervisor of Employment Specialists, one Supervisor of ASA Specialists, and two Supervisors of Benefits Specialists. Id.

         Each supervisor reports to a regional manager. Id. ¶ 32. There are two regional managers with management responsibilities for the DSS Pine Ridge Office. Id. The regional manager for the Division of Economic Assistance (“DEA Regional Manager”) oversees the Employment Specialist Supervisor and the Benefits Specialist Supervisor, along with the Employment Specialists and Benefits Specialists. Id.

         A Benefits Specialist processes a client's data to determine eligibility for government assistance programs such as the Supplemental Nutrition Assistance Program (“SNAP”), Electronic Benefits Transfers (“EBT”), Medicaid, and refers qualified clients to the Temporary Assistance for Needy Families (“TANF”) program. Id. ¶ 15. A Benefits Specialist is primarily engaged in interviewing clients to obtain the requisite information needed to determine eligibility, but visits homebound clients to understand their household. Id. ¶ 16; see also Docket 55 ¶ 16.

         An Employment Specialist primarily administers the conditions of the TANF program. That program requires individuals to spend approximately twenty hours a week attempting to find employment, obtaining further education, or performing community service. (Docket 49 ¶ 17). An Employment Specialist also attempts to find employment and educational opportunities for TANF recipients. Id. ¶ 18. Employment Specialists meet with clients applying for TANF to identify barriers to employment, and then through referrals, counseling, and other processes, help the individual to address those barriers. Id. ¶ 19. Field work was a substantial portion of an Employment Specialist's job duties. Id. ¶ 20.

         An ASA Specialist determines eligibility for in-home services primarily to the elderly, with the goal of keeping individuals in their home communities for as long as possible to avoid nursing home placement. Id. ¶ 21. Eligibility for ASA services is based on age and income. Id. ¶ 22. An ASA Specialist spends substantial time in the field performing in-home visits, delivering equipment and doing in-person eligibility assessments. Id. ¶ 23.

         Jim Treloar was the DEA Regional Manager from 2003 until October 2015. Id. ¶ 33. Keith Kearns was the Employment Specialist Supervisor from 1999 to October 2015. Id. ¶ 25. Mr. Kearns replaced Mr. Treloar and remains the DEA Regional Manager. Id. ¶ 34.

         Cheryl White was a Benefits Specialist Supervisor from 2004 until her retirement in November 2013. Id. ¶ 26. Ms. White was replaced by Rhonda Barker, who remains a Benefit Specialist Supervisor. Id. ¶ 27. Ron Shedeed was a Benefits Specialist Supervisor from the mid-1990's until his retirement in 2009. Id. ¶ 29. Michael Bakley replaced Mr. Shedeed and has been a Benefits Specialist Supervisor since 2010. Id. ¶¶ 28-29.

         The Regional Manager for the Division of Adult Services and Aging (“DASA Regional Manager”) oversees the ASA Specialist Supervisor and the ASA Specialists. Id. ¶ 35. Tammy Kabris was the DASA Regional Manager from 2011 until 2015. Id. Nancy Sletto was the ASA Specialist Supervisor from the mid-2000s until 2010. Id. ¶ 30. Rogine Page replaced Ms. Sletto and has been the ASA Specialist Supervisor since July 2011. Id. ¶ 31.

         Normally there are a static No. of Specialist positions at the DSS Pine Ridge Office and the opportunity to hire a new employee only arises when a vacancy in an existing Specialist position occurs. Id. ¶ 36. When a vacancy occurs the supervisor of that position (the “Hiring Supervisor”) informs the regional manager and prepares a requisition request asking that the position be advertised. Id. ¶ 37. DSS assigns each requisition a unique number. (Docket 47 ¶ 13). The requisition includes the job title, the position number, to whom the requisition list should be sent, whether the position was full-time or part-time, a description of an ideal candidate, a description of the knowledge, skills and abilities (“KSA's”) being sought and a list of any additional requirement questions. (Docket 49 ¶ 38). This information is incorporated into the formal job posting which includes a description of the position, the ideal candidate, the required KSA's and any supplemental questions. Id. ¶ 39.

         Job postings are advertised through the South Dakota Bureau of Human Resources (“BHR”), formerly the South Dakota Bureau of Personnel. Id. ¶ 40. Application materials are available online for viewing and printing. Id. ¶ 42. A candidate applying for a DSS position submits all application materials electronically to BHR. Id. ¶¶ 41 & 42.

         After a position is advertised, the Hiring Supervisor receives a certification list and has access through BHR's online system to the job candidates' application materials and supporting materials.[2] Id. ¶¶ 43-45. The Hiring Supervisor considers an applicant's materials in light of the KSA's and preferred qualifications of higher education, prior case management experience, and familiarity with the geography and culture of the Pine Ridge Reservation, to determine those qualified for an interview. Id. ¶ 48; see also Docket 55 ¶ 48. Depending on the No. of applicants, a Hiring Supervisor will conduct initial phone interviews to screen out applicants. (Docket 49 ¶ 46). If a smaller applicant pool is involved, the Hiring Supervisor may conduct only in-person interviews. Id. ¶ 47.

         In-person interviews are conducted by the Hiring Supervisor with assistance from another supervisor and occasionally the regional manager. Id. ¶ 49. The Hiring Supervisor creates a list of questions and the interviewers rotate through the questions with the applicant. Id. ¶ 50. The same questions are asked of each interviewee in a given requisition, with the interviewers asking follow-up questions which varied from interview to interview. Id. ¶ 51; see also Docket 55 ¶ 51.

         After reviewing the application, completing interviews and completing reference checks, if there was no applicant the Hiring Supervisor felt comfortable recommending for hire, the Hiring Supervisor has the discretion to have BHR cancel a requisition and re-advertise the position.[3] (Dockets 49 ¶ 52 & 55 ¶ 52). If the Hiring Supervisor finds a qualified applicant who had a successful interview and reference check, the applicant is recommended to the Regional Manager for hire.[4] (Docket 49 ¶ 53). The Regional Manager sends the final selection to the Division Director who passes the selection onto BHR for final approval. Id. ¶ 54. While additional clarifications regarding salary or requests for information are occasionally requested by the Division Director, there is no evidence a Hiring Supervisor's recommendation was ever rejected. Id. ¶ 55.

         From January 1, 2007 to December 31, 2013, the DSS Pine Ridge Office hired twenty white applicants and two Native American applicants as Specialists. (Dockets 49 ¶ 58 & 55 ¶ 58). During the same time period, the DSS Pine Ridge Office posted 35 open and competitive requisitions for Specialist positions.[5] Id. DSS's applicant-flow data for each requisition includes a list of all applicants with each applicant's self-identified racial classification and each applicant's individual status disposition for that requisition. Id. DSS maintains its applicant-flow data with the BHR. (Docket 47 ¶ 35).

         DEFENDANT'S MOTION FOR SUMMARY JUDGMENT

         In addition to the facts stated above, for purposes of addressing defendant's motion for summary judgment the following recitation consists of the material facts developed from the defendant's statement of undisputed material facts (Docket 49), plaintiff's response to defendant's statement of undisputed facts (Docket 55), and other evidence where indicated. Where a statement of fact is admitted by the opposing party, the court will only reference the initiating document. These facts are “viewed in the light most favorable to the [party] opposing the motion.” Matsushita Elec. Indus. Co., 475 U.S. at 587.

         UNDISPUTED MATERIAL FACTS

         In addition to the facts stated above, the undisputed facts pertinent to defendant's motion for summary judgment are as follows. In 2010-11, DSS maintained 64 offices within nearly every county in South Dakota.[6] (Docket 49 ¶ 4). Of those 64 offices, 35 were full-time offices and 29 were itinerant offices staffed for a few days each week or month. Id. In 2010, DSS employed 535 Specialists statewide. Id. ¶ 6. In 2010, DSS hired 234 new employees, including 37 new Specialists, statewide. Id. ¶ 8. In 2011, DSS had over 1, 800 employees statewide and employed 516 Specialists. Id. ¶¶ 5 & 7. In 2011, DSS hired 285 new employees statewide including 44 new Specialists. Id. ¶ 9.

         Prior to 2014, the individual Hiring Supervisors at the DSS Pine Ridge Office had discretion to conduct interviews and hiring in a non-uniform way. (Docket 55 ¶ 57). The Specialist hiring criteria was individualized to include non-statewide criteria, such as familiarity with the Native American culture. Id.

         “Statistical significance tests are used to decide whether a disparity, such as a disparity between the hiring rates of two groups (e.g., Native American applicants and white applicants), is or is not likely due to normally-occurring chance variation.” (Docket 47 ¶ 59). “A disparity can be described in terms of standard deviations, which correspond to the likelihood that an observed disparity at least as large as the one obtained would occur by chance. For example, a 5% likelihood equates to slightly less than two (1.96) units of standard deviation.” Id. ¶ 60. “Statisticians and other social scientists normally consider a disparity to be ‘statistically significant' if there is a 5% or lower likelihood (i.e., probability) that so large a disparity would occur by chance.”[7] Id. ¶ 61.

         The United States disclosed an expert report by Dr. Juliet Aiken to present a statistical analysis of the differences in hiring rates between Native American and white applicants for Specialist positions at the DSS Pine Ridge Office.[8] (Docket 49 ¶ 62). Dr. Aiken separated her analyses into three periods: (1) 2005-06; (2) 2007-13 (Pre-Competency); and (3) 2014-15 (Post-Competency). Id. ¶ 63. Dr. Aiken combined her statistical analyses of the three Specialist positions and concluded the difference in hiring rates was statistically significant, 3.47 standard deviations, for the Specialist positions in 2007-13. Id. ¶ 64. Dr. Aiken concluded the disparity was practically significant, projecting that if DSS had hired Native Americans at the same rate as all applicants, the DSS Pine Ridge Office would have hired eight more Native Americans as Specialists during the period of 2007-13. Id. ¶ 65.

         DSS disclosed an expert report from Dr. Janet Thornton in which she identified a No. of criticisms of Dr. Aiken's report. (Docket 49 ¶ 66). In both her report and in her deposition testimony, Dr. Thornton acknowledged there were statistically significant differences in the Native American composition of the offers extended to those ...


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