Wis.LIRC ER Decision: Smith, Arline - May 20, 1999 - Voluntary dismissal - with prejudice or without prejudice; Remedy

STATE OF WISCONSIN
LABOR AND INDUSTRY REVIEW COMMISSION
P O BOX 8126, MADISON, WI 53708-8126 (608/266-9850)

ARLINE SMITH, Complainant

RACINE UNIFIED SCHOOL DISTRICT, Respondent

FAIR EMPLOYMENT DECISION
ERD Case No. 199702274

An administrative law judge (ALJ) for the Equal Rights Division of the Department of Workforce Development issued a decision in this matter. A timely petition for review was filed.

The commission has considered the petition and the positions of the parties, and it has reviewed the evidence submitted to the ALJ. Based on its review, the commission agrees with the decision of the ALJ, and it adopts the findings and conclusion in that decision as its own.

DECISION

The decision of the administrative law judge (copy attached) is affirmed.

Dated and mailed May 20, 1999
smithar.rsd : 125 : 9

/s/ David B. Falstad, Chairman

/s/ Pamela I. Anderson, Commissioner

James A. Rutkowski, Commissioner

MEMORANDUM OPINION

The complainant's claims of discrimination on the basis of race with respect to her terms and conditions of employment and discrimination because she opposed a discriminatory practice under the Fair Employment Act were scheduled for a hearing on the merits on December 1 and 2, 1998. On December 1, the complainant conducted examination (apparently adversely) of several witnesses and lastly presented testimony herself on her claims of discrimination. The respondent declined to question any of the witnesses, including the complainant, instead reserving its right to call the witnesses when it presented its case.

Apparently, after completion of the complainant's testimony, counsel for the complainant stated that the complainant wished to voluntarily withdraw her complaint with the Equal Rights Division without prejudice and to pursue her complaint in federal court. The respondent objected, and moved to have the complaint dismissed on the merits and with prejudice. The ALJ issued an order which states that "The ERD complaint in this matter is dismissed without prejudice to any rights that the complainant may have to pursue this matter in another forum."

On appeal from the ALJ's order of dismissal, the respondent asks that the commission dismiss the complainant's complaint on the merits with prejudice, and to award the respondent costs and reasonable attorney's fees associated with its preparation for and participation in the hearing.

In support of its request that the complainant's complaint be dismissed on the merits with prejudice, the respondent asserts that it relied on the affirmative statements of complainant's counsel that complainant intended to pursue the matter through the hearing and therefore expended considerable time, money and resources preparing for the hearing. The respondent asserts that after the completion of its case, complainant's counsel stated that he had not intended to complete the Equal Rights Division hearing, but that he had used the hearing process for discovery purposes related to the complainant's federal claims. The respondent argues that prehearing discovery procedures were available to the complainant to use and that to use the hearing for discovery for a federal court claim is an abuse of process that should not be rewarded. Further, the respondent argues that based on the fact that complainant had fully exercised her right to present evidence at the hearing, its motion for dismissal should at least be considered on its merits. The respondent maintains that the complainant was unable to present a scintilla of evidence to create even an inference of discrimination, that the respondent was entitled to findings to that effect, and that by not granting its motion to dismiss on the merits the respondent has been stripped of its opportunity to have potentially conclusive findings on the complainant's allegations.

Wisconsin Administrative Code, Sec. DWD 218.03 provides as follows: "A complaint may be withdrawn at any time. A request for withdrawal shall be in writing and shall be signed by the complainant or by the complainant's duly authorized representative. Upon filing of a request for withdrawal, the department shall dismiss the complaint by written order. Such dismissal shall be with prejudice unless otherwise expressly stated in the order."

First of all, based on the language of the ALJ's order, it would appear that the complainant is effectively foreclosed from pursuing her complaint before the division. The order states that the complaint is "dismissed without prejudice to any rights that the complainant may have to pursue this matter in another forum." (emphasis in bold text added) The dismissal order does not address the complainant's right to again pursue her claim before the division. Absent an express statement that the complainant's complaint before the division is dismissed without prejudice, it is presumed to be with prejudice.

Second, while the respondent's assertions that at different times while proceeding before the division opposing counsel gave different statements about his intentions to proceed before the Equal Rights Division, if true, certainly suggests inappropriate and improper conduct on the part of counsel, even had the complainant proceeded with her case before the ALJ to its conclusion and the ALJ issued a decision on the merits adverse to the complainant, as long as there was no state court review of her claim the complainant would still be entitled to pursue her claims in federal court. Congress did not intend unreviewed state administrative determinations to have preclusive effect on a plaintiff's Title VII claims. University of Tennessee v. Elliot, 478 U.S. 788, 41 FEP Cases 1771 (1986). A plaintiff who pursues a Title VII action in federal court following an unreviewed state administrative determination is entitled to a trial de novo. Id. In Elliot, where the plaintiff was allowed to proceed on his Title VII claim, there had been extensive evidence presented in the administrative proceedings and a ruling that the employe's discharge had not been racially motivated. See also, Pugh v. Wisconsin DNR, 54 FEP Cases 337, 749 F. Supp. 205 (E.D. Wis. 1990)(A state administrative determination that has not been reviewed by a state court has no preclusive effect on a plaintiff's Title VII complaint, even if the plaintiff's Title VII complaint is based on the same issue or issues which were adjudicated by the state administrative agency). In Pugh, the court did note that the administrative agency's decision on the plaintiff's claim was admissible as evidence in the Title VII proceeding and could be accorded as much weight as the court deemed appropriate. However, to issue findings on the complainant's evidence before the ALJ now, when the complainant has made it known that she will pursue her claims in federal court and there is no assurance as to what weight the federal court would accord such findings in any event, is not something that seems warranted.

The respondent's bases for its request for costs and attorney's fees are as follows: 1) That the complainant presented her complete case at the hearing and failed to present a prima facie case of discrimination; and 2) that the expenses incurred by the respondent were the direct result of the complainant's abuse of the Equal Rights Division's process. However, even assuming for purposes of argument that the complainant had failed to present a prima facie case of discrimination, thus making the respondent the prevailing party, this fact would not entitle the respondent to an award for costs and attorney's fees. The Wisconsin Fair Employment Act does not authorize an award of costs and attorney's fees to a prevailing employer. Tatum v. LIRC, 132 Wis. 2d 411, 392 N.W.2d 840 (Ct. App. 1986). Secondly, while the respondent cites Dobbs v. Super 8 Motel (LIRC, 10/15/96), as authority for ordering payment of attorney's fees in this case as an available sanction for an "abuse of process" under the Fair Employment Act, the sanction in that case (award of attorney's fees) was ordered in connection with the complainant's failure twice to appear at a deposition. Under the administrative rules of the Equal Rights Division, Wisconsin Administrative Code, sec. DWD 218.14(4), express authority exists for the imposition of sanctions for failure to comply with discovery orders the same as a court has under ch. 804 Wis. Stats. However, except as provided in matters relating to discovery, neither the rules nor the Act provide any authority for awarding attorney's fees to an employer as a sanction for an alleged abuse of process by a complainant.

Given the above, the commission need not dismiss the complainant's complaint on the merits with prejudice, and no basis exists for the respondent's request for attorney's fees and costs associated with its preparation and participation in the hearing before the division.

cc: Willie J. Nunnery
Robin Van Harpen

NOTE: On June 15, 1999, the commission set aside this decision pending further consideration. [Subsequent decision]

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