A one-of-a-kind clash between the U.S. EEOC and a California civil rights agency over allegations of sexual harassment and prejudice against
The California Department of Fair Employment and Housing, which accused Activision of a toxic work culture in a July lawsuit, is clashing with the Equal Employment Opportunity Commission over the proposed the federal agency to settle similar claims for $ 18 million.
State regulators have sought to block the deal, saying it will hurt their case, while the federal agency has hit back with ethical concerns about California lawyers. A federal judge has scheduled a hearing for Monday on the state agency’s request to intervene in the EEOC case.
It’s never great when you see two government agencies fighting, because they are using public resources to essentially have a “turf war,” said Elizabeth Tippett, associate professor of law at the University of Law School. Oregon. “And typically, the primary beneficiary of fights between two agencies is the company’s employer – in this case, Activision.”
The unusual skirmish between two civil rights agencies can harm employees at the company and elsewhere in California, as it can drag out litigation and delay potential settlements, lawyers said.
“I have never seen anything like this before between the EEOC and state enforcement agencies,” said Mark Girouard, president of labor and employment practice at Nilan Johnson Lewis PA. is going to be this concern in the background that the state agency is going to step in and try to step in or undermine the “resolution with the EEOC.”
The commission “attaches great importance” to its cooperative relationship with state and local agencies to enforce federal anti-discrimination laws, spokesman Victor Chen said in a statement. He said the EEOC had deals with 91 state and local agencies nationwide, including California, and dealt with more than 42,000 accusations of bias in fiscal year 2021.
The DFEH did not respond to Bloomberg Law’s request for comment.
Volatility for employers
Prior to filing their separate complaints, the EEOC and DFEH conducted multi-year investigations into the allegations of Activision’s toxic workplace culture and pay and promotions bias.
Lawyers say the battle between the two will cause volatility for other employers facing discrimination complaints in California.
An employer sued by multiple entities will usually want to quickly settle with one of them if they can, Tippett said. “And if they suspect that an early settlement would create a conflict, that gives them an added incentive to try to do so,” she said.
Activision tried to use the EEOC’s ethical concerns about California lawyers – allegedly based on their previous involvement in the commission’s investigation before taking on leadership roles at DFEH – to its own advantage, suggesting that there might have been an issue with the state’s lawsuit, said Rick Hoeg, corporate attorney at law firm Hoeg PLLC.
The court declined to stay the state’s case on these grounds, and while Activision could potentially pursue this argument, it does not see the company gaining an advantage.
“In a vacuum, what you have is a delay, and Activision doesn’t necessarily want it,” Hoeg said. “He probably wants to start putting some of these lawsuits to bed.”
Girouard added: “I would say for employers in California, just to keep an eye on the fact that the other agency can wait behind the scenes to guess what you are doing.”
Impact on workers
The intra-agency disagreement can affect where employees file their initial bias charges, lawyers said.
“Most of the time, if you are a California employee, you will likely be better off and have more legal options available to you if you pursue your case under state law and through the DFEH rather than of the EEOC, “said Eric Bachman, director of Bachman Law in Washington, which represents workers in discrimination cases.
Additionally, he said, litigation and settlements could be delayed in future high-profile cases depending on how the Activision case unfolds.
The aim is for all those who defend workers “to row in the same direction,” Hoeg said.
“We don’t see these kinds of territorial battles very often, but it doesn’t do anything for developers on the ground,” he said, referring to video game workers. “In fact, I think the feud between the agencies is probably not great for the overall push to clean things up.”
Tippett said she expects both agencies to move forward with their cases and “Activision will face settlements with both.”
This conflict also makes lawyers wonder how it could affect agency relationships and future cases they would traditionally team up on.
“I don’t see the EEOC having as much of an interest in dividing up the work with the DFEH after this, and so I suspect that will result in a reduction in resources for the two agencies in California,” Girouard said. The result of this could be “less coordinated enforcement”.
The most recent work-sharing agreement between the two agencies was extended until September 30, 2021, but no new agreements or extensions have been filed.
Previously, the biggest lawsuits against employers were in private litigation, but due to class-action waivers signed by workers, the main avenue remaining for potentially costly judgments is government agencies, Tippett said.
“So the stakes are very high because this is the main remaining space where these class-based claims occur,” Tippett said.
Lawyers added, however, that this type of confrontation between the federal government and the states is more likely to occur in California than in other states.
“The DFEH has always taken, I think, a more aggressive stance than the EEOC, and like in many other areas, California is setting its own course and therefore will likely continue to do so,” said Girouard. “I would be surprised to see this type of conflict with other state agencies.”
He added that this type of government disagreement is likely to occur in high class cases and not for individual claims, which constitute the vast majority of federal and state discrimination charges.
Bachman said he hoped that because the Activision case is so unique it won’t necessarily be “a glimpse of an issue to come in future enforcement actions.”
“I really hope that the leaders of these agencies can understand this and that at the end of the day they are all on the same side – they should be there to protect the rights of the employees,” he said.