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We previously reported on a case where the EEOC was hit with a $4.7 million judgment in attorneys’ fees and costs for pursuing a frivolous class action. (See blog post EEOC Silent on Sanctions) This week the Eighth Circuit Court of Appeals reversed that ruling, in part. EEOC v. CRST Van Expedited, Inc., No. 13-3159 (8th Cir. Dec. 22, 2014)  

The EEOC sued CRST claiming that it subjected roughly 270 female employees to sexual harassment.  The trial court ultimately dismissed almost all of the claims for a variety of reasons.  The EEOC ultimately settled the case for $50,000 on behalf of only one of the claimants.  The trial court then entered judgment on CRST’s behalf for $4.6 million in attorneys’ fees and costs.

In a highly technical ruling, the Appeals Court first found that CRST was not entitled to recover attorneys’ fees with respect to (1) 67 of the purported class members because their claims were dismissed on purely procedural grounds, and (2) the EEOC’s pattern and practice claim, which never appeared in the EEOC’s Complaint.  The Appeals Court sent the rest of the case back to the trial court for that court to specifically identify each and every individual frivolous claim (of the remaining 90 or so), and how much of CRST’s $4.6 million in fees and costs were incurred exclusively in defense of those claims.  This is no small feat for any trial court, and it promises to dramatically reduce CRST’s judgment.  It also unfortunately promises much mischief in the future by giving the EEOC a clever way to game the system and jettison multiple claims on procedural grounds to avoid judgments like this one.