In August, I posted
about an interesting Cat’s Paw theory case, Gray
v. State Farm Mutual Auto. Ins. Co., (6th Cir.
2025), where the Sixth Circuit reversed an employer's summary judgement due to possible selective enforcement of a time card fraud policy by a manager in retaliation for the plaintiff's prior protected conduct.
As I briefly explained:
In July, the Sixth Circuit reversed
an employer’s summary judgment on a retaliation claim where the plaintiff
claimed that she was investigated and then fired in retaliation for assisting a
co-worker assert her rights under the ADA and be transferred away from her
discriminatory supervisor. Gray
v. State Farm Mutual Auto. Ins. Co., 145 F.4th 630 (6th Cir.
2025). When her co-worker’s discriminatory supervisor filled in for
the plaintiff’s supervisor shortly after the protected conduct, he launched an
unprompted and unprecedented investigation into the plaintiff’s time cards by
comparing them to her computer use. No other employee was investigated –
despite similar discrepancies -- and the plaintiff was ultimately fired for
time card abuse.
The Court agreed that the evidence
aligned with its precedent holding that “employees can establish prima facie
causation by showing that their employer began scrutinizing them more heavily
shortly after they engaged in protected activity, and then used its findings to
justify termination.” The plaintiff was able to show that the discriminatory
supervisor knew of her assistance to her co-worker and his retaliatory intent
under a “cat’s paw” theory of vicarious liability.
While the employer may have avoided
direct liability under an honest belief theory, the supervisor’s actions could
not. A “supervisor does not have to lie in order to be biased. As we have
repeatedly recognized, a supervisor can cause an employee’s termination by
reporting true yet selective information.” Moreover, although “an
employer can escape liability by conducting ‘an in-depth and truly independent
investigation’ into an otherwise biased report, . . . when a supervisor
reports true but selective information, an investigation will always confirm
the supervisor’s allegation.” In this case, the employer and HR failed to
take the plaintiff’s complaint of retaliation seriously or to compare her
misconduct to other employees before terminating her employment.
The Court then held a re-hearing and amended its decision
and dissent in December. Gray v.
State Farm Mutual Auto. Ins. Co., 159
F.4th 1024 (6th Cir. 2025).
Here is some of the additional
text that was then added to its decision (emphasis added):
A simple example illustrates why.
Imagine a workplace where five employees were engaged in the same pattern of
misconduct. If a supervisor made a true but selective report of wrongdoing
against one of the five employees because of that employee's race, they would
be attempting to use the company's human resources as the "conduit"
for their bias. See Romans v. Michigan Dep't of Hum.
Services, 668 F.3d 826, 835 (6th Cir. 2012). If human resources then opened
an independent investigation into that one employee, it would confirm the
biased report, but it would not necessarily negate the supervisor's bias in
singling out one employee based on race. That's why the Supreme Court
"declined to adopt [] a hard-and-fast rule" that "an independent
investigation has a claim-preclusive effect" or "somehow relieves the
employer of 'fault.'" Staub, 562 U.S. at 420-21.
Our decision today does not
impose a bright-line rule that a supervisor's true-but selective report will
always be the proximate cause of any subsequent adverse employment action. Rather, we simply echo Staub's holding that
a subsequent investigation that does nothing more than confirm a
supervisor's true-but-selective report is by itself insufficient to break the
chain of proximate causation. . . . . An employer can still negate
causation by establishing that "the employer's investigation result[ed] in
an adverse action for reasons unrelated to the supervisor's original biased
action." . . . . . Put another way, an employer
will not be liable if its investigation uncovers a superseding "cause of independent
origin that was not foreseeable" from the supervisor's biased action .
. .
We have previously held that the
existence of a superseding cause is a question of fact. . . .
Here,
the undisputed record shows that [the manager] reported [the plaintiff] for
"manually changing" her time entries and identified three
discrepancies as proof of that fact. [The employer’s] HR employee, . . . , thereafter conducted her own
investigation that revealed additional discrepancies beyond the three
identified by [the manager], including instances where [the plaintiff] reported
working while she was not in the building. [The employer] claims that it fired [her]
based on these additional out-of building discrepancies. On summary judgment, the
question that we must answer is whether [her] termination based on these
additional discrepancies was so "unrelated" to [his] original report
and so "not foreseeable" by him that no reasonable factfinder could
find proximate causation.
We
hold that this question cannot be answered as a matter of law. [The manager]
reported generally that [the plaintiff] was "manually changing" her
time, not that she had done so only in the three instances that he identified.
He also falsely informed [HR] that [she] had previously been reprimanded for
similar conduct, suggesting that his report concerned a broad pattern of
timekeeping issues. And he suggested in his report to HR that an investigation
of [her] would uncover additional timekeeping errors. Given that [his] report
and [her] termination both related to [her] timekeeping entries, a reasonable jury
could find that the former improperly influenced—and was a proximate cause
of—the latter.
Our decision in Romans does
not counsel otherwise. Romans does not stand for
the proposition that an independent investigation always breaks the chain of
causation. Nor could it after
the Supreme Court's rejection of that argument in Staub. It instead held that the
independent investigation broke the causal chain because of the particular
facts at issue in that case. There, the decisionmaker expressly disclaimed
reliance on an allegedly biased report and conducted a separate investigation into
the plaintiff's alleged misconduct. . . . . The separate investigation found
that the plaintiff had "violated four work rules, only one of which was
related to [the allegedly biased] report, and each of which would have
individually supported a termination." . . . Therefore, Romans falls
comfortably within the scenario delineated in Staub where an independent
investigation "results in an adverse action for reasons unrelated to the
supervisor's original biased action." . . .
By contrast, here, [the employer] relied
on [the manager’s] report and opened an investigation that confirmed his
allegations. [It] then took the adverse action that [his] report was
"designed and intended" to produce by firing [her] for timekeeping
discrepancies. . . . . So a jury could conclude that [its]
investigation took into account [his] biased report and failed to determine
that the adverse action was justified apart from his recommendation. . . . . Romans supports rather than
undermines this analysis.
The dissent continued
to elaborate why the independent
investigation by HR, which uncovered additional and more sever timekeeping
violations, should have resulted in summary judgment as breaking the cat’s paw causation.
NOTICE: This summary is designed merely to inform and alert
you of recent legal developments. It does not constitute legal advice and does
not apply to any particular situation because different facts could lead to
different results. Information here can change or be amended without notice.
Readers should not act upon this information without legal advice. If you have
any questions about anything you have read, you should consult with or retain
an employment attorney.
