The Philadelphia District Office of the Equal Employment Opportunity Commission brought this lawsuit against Spitzer Management, Inc., an auto dealership, in September 2006 in the U.S. District Court for the Northern District of Ohio. The complaint alleged that Spitzer management had created a hostile work environment for employees by harassing a Nigerian complainant, a Korean complainant, and other employees based on their national origin. The complaint also alleged that Spitzer constructively discharged the Korean employee on the basis of his ethnicity. The EEOC sought injunctive and monetary relief for the complainants.

Very little litigation occurred during the first few years of the case. The parties conducted discovery from January 2009 to September 2010. During that time, two individuals intervened as plaintiffs. Judge Ann Aldrich granted this request on February 24, 2009.

The two intervenors filed an amended complaint on April 12, 2010. This complaint alleged that the defendants discriminated, based on race and national origin, and retaliated against the intervenor plaintiffs. These plaintiffs, represented by their own private counsels, sought injunctive, monetary, and declaratory relief, claiming violations of Title VII, 42 U.S.C. § 1981,Ohio Revised Code § 4112, and abuse of process. The plaintiffs’ abuse of process claim alleged that the defendants brought lawsuits against these plaintiffs to dissuade them from engaging in protected activity such as opposing illegal discrimination and retaliation.

On May 6, 2010, John R. Adams replaced Judge Aldrich on the case. And then, on October 20, 2010, the court ordered that this lawsuit be consolidated with three other cases, all of which were brought by the EEOC alleging that the defendant's Motor City dealership had engaged in discrimination in violation of Title VII. This case, however, served as the leading case.

On January 14, 2013, jury trial began. During the course of trial, the plaintiff objected to certain documents presented by the defendants. On January 22, the plaintiff moved for a default judgment against the defendants, alleging the defendants had engaged in 'gamesmanship' through the "last-minute production and misrepresentation
regarding the investigatory notes" that had been central to the case.

On May 22, 2013, the court denied the plaintiff’s request for default judgement, however, the court awarded attorney fees and costs to the plaintiffs as sanctions against the defendants. The court arrived at this sanction after coming to three conclusions. First, the defendants’ failure to produce the original documents to the plaintiffs during discovery was not an act of negligence. It was intentional. The court arrived at this conclusion when it observed that in less than 24 hours, only after the court demanded the documents, the defendants were able to locate and produce the documents. These documents were documents that the plaintiff requested during discovery. The defendants gave no reasons for withholding the documents.

Second, the defendants’ misconduct deprived the plaintiffs of meaningful discovery, which prevent the plaintiffs from being able to meaningfully prepare for trial. The withheld documents were files that the defendants had on their employees. More specifically, these documents contained information on employee evaluations, hiring and firing information. The court deemed these documents as relevant for discovery and the trial.

And finally, the court declared that the sanction of attorney fees and costs was more appropriate than granting a default judgment. The court reasoned that a default judgment would have constituted a windfall in favor of the plaintiffs. In other words, the judgment would benefit the plaintiffs more than they deserved. To the court, the evidence that the court observed was not strong enough to grant the plaintiffs a default judgment.

The court ordered the following attorney fees and costs for the defendant to pay: the defendant was made to pay $49,000 to the EEOC, pay $148,920 to one plaintiff, and $115,395 to another (this amount was later corrected to $130,415).

The parties then began preparing for pretrial, with a special master overseeing discovery.

Before the second attempt at a trial, the parties reached a settlement. On September 12, 2013, the court approved of the parties’ consent decree. This decree was set for five years and the court retained jurisdiction. The consent decree had the following terms:
1) the defendants were prohibited from engaging in employment discrimination and retaliation;
2) the defendants had to pay $100,000.00 to the plaintiff;
3) the defendants had to develop anti-discrimination policies, anti-harassment policies and complaint procedures;
4) the defendants had to provide management accountability concerning discrimination and retaliation;
5) the defendants were required to offer anti-discrimination training;
6) the defendants had to report to the EEOC on any employment discrimination and/or retaliation complaints filed to the defendants;
7) and the defendants had to post a notice of the decree in all their employment establishments and be visible to all its employees.

There has been no further litigation after the approval of the consent decree. Nonetheless, the five years are not yet complete, and so the case is ongoing.

Shankar Viswanathan - 05/29/2008
Sean Whetstone - 05/29/2018


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