On September 9, 2008, in response to charges filed by 18 women, the Equal Employment Opportunity Commission (EEOC) filed suit against Sterling Jewelers, Inc., alleging violation of Title VII of the Civil Rights Act of 1964 through sex-discriminatory employment practices. Specifically, the EEOC claimed that Sterling Jewelers intentionally discriminated against female sales employees by maintaining a system of excessively subjective promotion and compensation decisions and thereby permitting or encouraging managers to deny equal access to promotion and compensation to female employees. The EEOC claimed in the alternative that Sterling Jewelers maintained an excessively subjective system that had an illegal disparate impact on female retail sales employees. The EEOC sought injunctive and monetary relief, including back pay, promotion, compensation for lost benefits and emotional suffering, and development of policies and programs to provide equal opportunities to women and eliminate the effects of past discrimination. The EEOC also sought to recoup the cost of its litigation. The litigation was brought on behalf of the 18 charging parties and all other similarly situated female employees.

The progress of the case has been slow because of numerous disputes over procedure and discovery.

On January 6, 2010, the Court (Judge Richard J. Arcara) denied Sterling's motion to dismiss all claims for conduct preceding the statute of limitations period for the first party to file charges with the EEOC. 2010 WL 86376 (W.D.N.Y. 2010) (holding that the EEOC was not bound by the statute of limitations, which applied only to individuals).

On July 15, 2010, the Court (Magistrate Judge Jeremiah J. McCarthy), among other things, allowed the charging parties to intervene in the proceedings to participate in argument over the scope of a protective order. 2010 WL 2803017 (W.D.N.Y. 2010). For contractual reasons the charging parties were pursuing their claims separately in a class-action arbitration and wanted to be able to receive discovery information from the EEOC, though they were prohibited from sharing information with the EEOC. See Jock v. Sterling Jewelers, Inc., linked below (Clearinghouse ID: EE-NY-0237). The protective order was issued on July 23, 2011.

On April 25, 2011, the Court (Richard J. Arcara) bifurcated trial and discovery into two phases, liability (Stage I) and damages (Stage II). Stage I generally covers the issue of whether there was a disparate impact on female retail employees at Sterling to establish a pattern or practice of discrimination, while Stage II, would occur only if the EEOC prevails at phase I, and covers the individual aspects of each employee's case and whether there was a legitimate business reason for the disparity. The EEOC sought to have the punitive damages determination included in phase I, but the Court rejected that approach. 788 F.Supp.2d 83 (W.D.N.Y. 2011).

The bifurcation was followed by extensive discovery dispute. The case has not left the Stage I discovery process and is ongoing.

Kenneth Gray - 06/14/2013


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