Labor & Employment Law Daily SCOTUS rules Section 1981 demands a but-for causation pleading standard,
Thursday, March 26, 2020

SCOTUS rules Section 1981 demands a but-for causation pleading standard,

By Joy P. Waltemath, J.D.

Under Section 1981, a plaintiff has the burden of showing that the plaintiff’s race was a but-for cause of its injury, and that burden remains constant over the life of the lawsuit—including at the pleading stage.

In a case arising outside the employment context but with big employment law implications, the U.S. Supreme Court ruled that the African-American owner of Entertainment Studios Network (ESN) must plead (and has the ultimate burden of showing) that race was the but-for cause of Comcast’s decision not to carry channels produced by ESN and thus amounted to racial discrimination in violation of Section 1981(Comcast Corp. v. National Association of African American Owned-Media, March 23, 2020, Gorsuch, N.).

Make and enforce a contract. The case was unusual in that it arrived at the High Court on the appeal from a motion to dismiss. Below, Entertainment Studios Network (ESN), an African American-owned television-network operator, wanted to contract with Comcast Corporation to carry its channels on cable TV, but Comcast refused, citing “lack of programming demand, bandwidth constraints, and a preference for programming not offered by ESN.” ESN and the National Association of African American-Owned Media sued under 42 U. S. C. §1981, which guarantees “[a]ll persons the same right to make and enforce contracts as is enjoyed by white citizens.”

What role did race play? Although the district court dismissed the complaint for failing plausibly to show that, “but for” racial animus, Comcast would have contracted with ESN, the Ninth Circuit reversed. It held that ESN needed only to plead facts plausibly showing that race played “some role” in the defendant’s decision-making process and that, under this standard, ESN had pleaded a viable claim.

But-for causation must be pleaded. In its nearly unanimous ruling (Justice Ginsburg concurred but for just one footnote), the Court reasoned that a tort plaintiff typically must prove but-for causation, and normally the burdens as to the essential elements of a claim remain constant throughout the lawsuit. The Court remained unconvinced by ESN’s argument that §1981 creates an exception to one or both of these general principles.

Section 1981 follows the usual rules, said the Court, reasoning that the statute’s text itself suggests but-for causation. “If the defendant would have responded the same way to the plaintiff even if he had been white, an ordinary speaker of English would say that the plaintiff received the ‘same’ legally protected right as a white person. Conversely, if the defendant would have responded differently but for the plaintiff’s race, it follows that the plaintiff has not received the same right as a white person.” Nothing in the text suggests that the test should be different in the face of a motion to dismiss, either.

Further, when it was enacted, Section 1981 did not provide a private enforcement mechanism for violations. When that right was judicially created, the Court “usually insisted on legal elements at least as demanding as those Congress specified for analogous causes of action actually found in the statutory text.”

Here a neighboring section of the 1866 Act establishing criminal sanctions uses the terms “on account of” and “by reason of” race—terms the Court has often held indicate a but-for causation requirement. “This Court’s precedents confirm all that the statute’s language and history indicate. When it first inferred a private cause of action under §1981, this Court described it as ‘afford[ing] a federal remedy against discrimination on the basis of race,’ language (again) strongly suggestive of a but-for causation standard,” reiterated the Court.

Title VII is not the model. As for looking to Title VII as a model (including Congressional amendments that recognized its motivating factor test), the Court said, “To accept ESN’s invitation to consult, tinker with, and then engraft a test from a modern statute onto an old one would thus require more than a little judicial adventurism, and look a good deal more like amending a law than interpreting one.”

Accordingly, the Court vacated the judgment of the Ninth Circuit and remanded for further proceedings to allow the Ninth Circuit “the chance to determine the sufficiency of ESN’s pleadings under the correct legal rule.”

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