Equal Employment Opportunity Commission v. North Gibson School Corportation 00-3117 UNITED STATES COURT OF APPEALS FOR THE SEVENTH CIRCUIT No. 00-3117 EQUAL EMPLOYMENT OPPORTUNITY COMMISSION, Plaintiff-Appellant, v. NORTH GIBSON SCHOOL CORPORATION, Defendant-Appellee. On Appeal from the United States District Court for the Southern District of Indiana, Evansville Division Honorable Larry J. McKinney, Judge REPLY BRIEF OF THE EQUAL EMPLOYMENT OPPORTUNITY COMMISSION AS APPELLANT GWENDOLYN YOUNG REAMS Associate General Counsel PHILIP B. SKLOVER Associate General Counsel CAROLYN L. WHEELER Assistant General Counsel PAULA R. BRUNER Attorney EQUAL EMPLOYMENT OPPORTUNITY COMMISSION 1801 L Street, N.W., Rm. 7044 Washington, DC 20507 (202) 663-4731 TABLE OF CONTENTS TABLE OF AUTHORITIES ii ARGUMENT 1 CONCLUSION 22 CERTIFICATE OF COMPLIANCE CERTIFICATE OF SERVICE TABLE OF AUTHORITIES CASES Albermarle Paper Co. v. Moody, 422 U.S. 405 (1975) 7 Alden v. Maine, 527 U.S. 706 (1999) 20 Bailey v. Canan, 82 F.Supp.2d 966 (S.D. Ind. 2000) 21 Board of Trustees Hamilton v. Landry, 638 N.E.2d 1261 (Ind.App.1994) 20 Braaksma v. Wells Community Hosp., 98 F.Supp.2d 1026 (N.D. Ind. 2000) 21 Barnes v. Anne Arundel Cty. Bd. of Educ., 2000 WL 979108 (D.Md. July 14, 2000) 21 Chakonas v. City of Chicago, 42 F.3d 1132 (7th Cir. 1994) 19 EEOC v. American & Efird Mills, Inc., 964 F.2d 300 (4th Cir. 1992) 6, 19 EEOC v. City of Colleges of Chicago, 944 F.2d 339 (7th Cir. 1991) 19 EEOC v. ElginTeachers Ass'n, 658 F.Supp. 624 (N.D. Ill. 1987) 14 EEOC v. Gladieux Refinery Inc., 631 F. Supp. 927 (N.D. Ind. 1986) 5 EEOC v. Harris Chernin, Inc., 10 F.3d 1286 (7th Cir. 1993) 5, 6, 13 EEOC v. Harvey L. Walner & Assocs., 1995 WL 470233 *3 (N.D. Ill. 1995), aff'd, 91 F.3d 963 (7th Cir. 1996) 4 EEOC v. Harvey L. Walner & Assocs., 91 F.3d 963 (7th Cir. 1996) 6, 18 EEOC v. Hickman Mills Consolidated School District No. 1, 99 F.Supp.2d 1070 (W.D. Mo. 2000) 21 EEOC v. Ilona of Hungary, Inc., 108 F.3d 1569 (7th Cir. 1997) 9, 12, 14 EEOC v. Johnson & Higgins, Inc., 91 F.3d 1529 (2d Cir. 1996) 5 EEOC v. Kidder Peabody, 156 F.3d 298 (2d Cir. 1998) 12, 14 EEOC v. Maryland Cup, 785 F.2d 471 (4th Cir. 1986) 18 EEOC v. New York Times Broadcasting Serv., Inc., 542 F.2d 356 (6th Cir. 1976) 9, 13 EEOC v. Tire Kingdom Inc., 80 F.3d 449 (11th Cir.1996) 3, 6 EEOC v. United Ins. Co. of Am., 666 F. Supp. 915 (S.D. Miss. 1986) 4 EEOC v. Waffle House, 193 F.3d 805 (4th Cir. 1999) 18, 19 Gary A. v. New Trier High School Dist., 796 F.2d 940 (7th Cir.1986) 21 General Tel. Co. v. EEOC, 446 U.S. 318 (1980) 7 Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20 (1991) 5 Henn v. National Geographic Society, 819 F.2d 824 (7th Cir.), cert. denied, 484 U.S. 964 (1987) 17, 18 Holman v. State of Indiana, 211 F.3d 399 (7th Cir. 2000) 12 Horowitz v. Board of Educ. of Avoca, 2000 WL 1100858 (N.D. Ill. June 7, 2000) 19, 21 International Bhd. of Teamsters v. United States, 431 U.S. 324 (1977) 7 Jenkins v. McKeithen, 395 U.S. 411 (1969) 12 Kimel v. Florida Board of Regents, 528 U.S. 62, 120 S.Ct. 631 (2000) 2, 20 Lorance v. AT&T Technologies, Inc., 490 U.S. 900 (1989) 8 Martin v. Consultants & Administrators, Inc., 966 F.2d 1078 (7th Cir. 1992) 15, 17 McKennon v. Nashville Banner Pub. Co., 513 U.S. 352 (1995) 7, 8 Mt. Healthy City School Dist. Bd. of Educ. v. Doyle, 429 U.S. 274 (1977) 21 Narin v. Lower Merion School Dist., 206 F.3d 323 (3d Cir.2000) 21 Solon v. Gary Community School Corp., 180 F.3d 844 (7th Cir. 1999) 1, 9, 11, 12, 17, 18 Sprogis v. United Air Lines, 444 F.2d 1194, 1202 (7th Cir.), cert. denied, 404 U.S. 991 (1971) 9 Weihoff v. GTE Directories Corp., 61 F.3d 588 (8th Cir. 1995) 4 STATUTES 29 U.S.C. § 217 10 29 U.S.C. §255 3 42 U.S.C. § 2000e-5(b) 4 42 U.S.C. § 2000e-8(a) 4 Pub.L.No. 102-166, §115,105 Stat. 1071,1079 (1991) 3 ARGUMENT In its opening brief, the Commission argued that the district court erred in granting summary judgment for North Gibson School Corporation ("North Gibson") on its ADEA claims for monetary damages. The Commission contended that the district court erred in holding that the filing of a timely charge was necessary for the Commission to seek and obtain damages for seven individuals. We argued that the agency has the authority to litigate claims under the ADEA independent of the filing of a charge, timely or otherwise, and that monetary relief for individuals, particularly when they could not have obtained such relief themselves, does serve the public interest. EEOC Br. at 17-25. The Commission also contended that even if a timely charge were required, a reasonable jury could find that a timely charge had been filed since retirement benefits were paid pursuant to North Gibson's 1995 discriminatory retirement plan ("ERP") as late as October 1997, two months prior to the filing of EEOC charges by Fred Anthis and Lewis Schleter in December 1997. Id. at 25-28. Finally, the Commission contended that the district court erred in dismissing its claims for injunctive relief to prevent future age discrimination against Anthis and Schleter who remain in North Gibson's employ. The Commission argued that not only does the ADEA, through its incorporation of Fair Labor Standards Act provisions, expressly grants district courts the authority to enjoin an employer from withholding amounts owing to an individual aggrieved by a violation of the ADEA, but this Court reaffirmed the availability of that form of injunctive relief in Solon v. Gary Community School Corp., 180 F.3d 844, 848-49 (7th Cir. 1999). Id. at 28-31. In response, North Gibson asserts that the district court's dispositions of EEOC's requests for injunctive and monetary relief were correct. It argues that the district court properly dismissed the Commission's injunctive relief claim as moot. North Gibson ("NG") Br. at 14-21. It argues, however, as an alternative basis for affirmance, that the court erred in finding that there is no statute of limitations applicable to the ADEA claims for relief brought by the EEOC. Id. at 22-25. With respect to the summary judgment disposition, North Gibson contends that the district court correctly found that the EEOC cannot pursue monetary damages on behalf of individuals who have filed untimely charges or have waived their right to seek relief by not filing a charge at all because an action for monetary relief does not serve the public interest. Id. at 26-31. It also contends that a reasonable jury could not have concluded that Anthis and Schleter filed timely charges because there are no disputed issues of fact for a jury to decide and the district court properly determined that no events following the discontinuance of the challenged plan extended the charge-filing period. Id. at 31-33. Finally, in attacking the Commission's authority to bring this ADEA action at all, North Gibson offers two legal arguments to support summary judgment against the EEOC that were either rejected or ignored by the district court. First, North Gibson argues that the EEOC's ADEA claims should be barred by laches because the agency's delay in exercising its enforcement powers was unreasonable and prejudicial. Id. at 34-41. Second, North Gibson argues that the EEOC's action is barred by Kimel v. Florida Board of Regents, 120 S.Ct. 631 (2000), because after the Supreme Court invalidated Congress's amendment extending the ADEA's coverage to states and its political subdivisions, "an ADEA claim cannot be brought against a local governmental entity." Id. at 41-42. Thus, it asserts that the district court erred in denying its second motion to dismiss and summary judgment can be upheld on this ground. For the reasons discussed below (and in its main brief), the Commission urges this Court to reverse the district court's erroneous decisions and remand the Commission's ADEA claims for further proceedings. 1. No Statute of Limitations Governs the EEOC's ADEA Action Although the district court correctly resolved this issue, North Gibson insists that the EEOC's ADEA suit should be dismissed because there must be some statute of limitations governing EEOC suits. NG Br. at 23. As stated in the Commission's opening brief, there is no statute of limitations governing EEOC suits enforcing the ADEA. EEOC Br. at 18-20. The 1991 Civil Rights Act plainly eliminated the two and three-year statute of limitations provisions that governed the Commission's (and private individuals') right to file an ADEA suit. See Pub.L.No. 102-166, §115,105 Stat. 1071,1079 (1991). The 180-day charge filing period in Section 7(d)(1) of the ADEA applies only to an individual's right to file a civil suit. EEOC v. Tire Kingdom, Inc., 80 F.3d 449, 451 (11th Cir. 1996). Despite the plain language of the statute, North Gibson argues that Congress's decision to eliminate the reference to the statute of limitations provision found in 29 U.S.C.§255 because of its concern over the confusion created by different procedures for individuals asserting violations under Title VII and the ADEA does not support a determination that the EEOC is not subject to limitations. NG Br. at 23. According to North Gibson, support for its position can be derived from "a simple reading"of the 1990 amendment to the Age Discrimination Claims Assistance Act of 1988 (ADCAA), and from two Title VII cases cited in its brief. Id. at 23-25. Nothing in ADCAA or its 1990 amendments imposes an independent and overriding statute of limitations on the EEOC's authority to enforce the ADEA. Congress amended ADCAA in 1990 to restore ADEA claims which were lost due to delays in investigations conducted by the EEOC or state agencies. While ADCAA was in effect, ADEA claims were subject to the two or three year limitations period for filing complaints that governed the EEOC and individual claimants. Weihoff v. GTE Directories Corp., 61 F.3d 588, 590 & n.2 (8th Cir. 1995). Thus, references in the legislative history to provisions then in effect are unsurprising, and certainly cannot bear the interpretation North Gibson imputes to them of an intent to override the plain text of a subsequent statutory enactment. Further, the Title VII district court opinions cited by North Gibson are unavailing. These cases stand for the unremarkable proposition that the EEOC must adhere to substantive requirements of the statutes it enforces. See NG Br. at 25. There, the courts merely declared that under Title VII the charge-filing requirement is a substantive requirement. EEOC v. Harvey L. Walner & Assoc., 1995 WL 470233 *3 (N.D.Ill. 1995), aff'd, 91 F.3d 963 (7th Cir. 1996); EEOC v. United Ins. Co. of Am., 666 F.Supp. 915, 918 (S.D.Miss. 1986). Unlike the ADEA, Title VII requires that a charge be filed before the EEOC can exercise its authority to investigate or file a lawsuit. 42 U.S.C.§§ 2000e-5(b), 2000e-8(a). This charge-filing limitation on the EEOC's enforcement authority in Title VII cases has no bearing on the Commission's enforcement authority under the ADEA and the cited decisions expressing the courts' views that the charge-filing requirement implicates substantive rather than procedural rights cannot create an analogous right under the ADEA where Congress did not impose such a requirement. Thus, the district court correctly stated the law on this issue and North Gibson's arguments to the contrary are patently frivolous. 2. The EEOC's Damages Claim is not Dependent on Timely Charges Although it disputes the district court's determination on the statute of limitations issue, North Gibson contends that the district court properly granted summary judgment on the EEOC's claims for monetary relief on behalf of individuals who had not filed timely charges or any charges at all. The school corporation asserts that when the EEOC is seeking relief for such individuals, there is privity between the EEOC and the individuals and thus, an agency action on their behalf must be "in the public's interest because it unfairly affects substantive rights of the employer." NG Br. at 27; 26-29. Applying that reasoning, North Gibson argues that the court properly concluded that the EEOC's action did not serve the public interest. These arguments must fail. As discussed in the Commission's opening brief, the district court erred when it decided that the Commission's claims for monetary relief were time-barred because the action was not supported by timely charges. EEOC Br. at 21-25. As the Supreme Court and this Court have recognized, the Commission's authority to investigate and secure relief for violations of the ADEA is not dependent on the filing of a charge of discrimination, timely or otherwise. See Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20, 28 (1991) (upholding EEOC's authority to investigate individual's age discrimination claim even though individual was barred from bringing private action because his claim was subject to arbitration); EEOC v. Harris Chernin, Inc., 10 F.3d 1286, 1291 (7th Cir. 1993) ("EEOC has right to sue independent of any private plaintiff's rights"); EEOC v. Gladieux Refinery Inc., 631 F.Supp. 927 (N.D.Ind. 1986) (EEOC's investigatory power under the ADEA is unaffected by untimely filed employee charges). Other federal courts have reached this same conclusion. See EEOC v. Johnson & Higgins, Inc., 91 F.3d 1529, 1536-37 (2d Cir. 1996) (holding that EEOC was authorized to file suit to recover monetary and injunctive relief for individuals who had retired under a discriminatory retirement plan, but had not filed charges and did not consider themselves victims of discrimination); Tire Kingdom, 80 F.3d at 451 (EEOC has power to investigate under ADEA even if underlying age discrimination charge is untimely since no language in the statute conditions its investigatory power on filing of a charge); EEOC v. American & Efird Mills, Inc., 964 F.2d 300, 303 (4th Cir. 1992) ("[n]othing in the language of [the ADEA], or in the incorporated language of the other statutes, hinges EEOC authority on the filing of a valid employee charge"). Acknowledging this independent authority, this Court has only limited the EEOC's authority to seek monetary relief and reinstatement on behalf of individuals under the ADEA to instances where the individuals have previously litigated their discrimination claims and further relief was barred by principles of res judicata. Harris Chernin, 10 F.3d at 1291. To date, this Court has not extended its decision in Harris Chernin to encompass individuals who have settled, arbitrated or waived their claims. Consequently, North Gibson's reliance on Harris Chernin to bar this action is misplaced because none of the claimants have filed private actions for monetary damages against North Gibson. EEOC Br. at 21-22. Finally, even if Harris Chernin were read to create a requirement that an EEOC claim for damages must be justified by independent proof of a "public interest" to be served by such relief, the district court erred in holding that there could be no such interest in this case. See NG Br. at 30-31. As this Court observed in a Title VII case, through its enforcement, "EEOC acts both for the benefit of specific individuals and 'to vindicate the public interest in preventing employment discrimination.'" Harvey Walner, 91 F.3d 963, 968 (7th Cir. 1996) (quoting General Tel. Co. v. EEOC, 446 U.S. 318, 326 (1980)). Compensating victims for losses suffered as a result of the defendant's discrimination is one of the primary goals of enforcing anti-discrimination statutes. McKennon v. Nashville Banner Pub. Co., 513 U.S. 352, 358 (1995) (deterrence is one object of these [anti-discrimination] statutes; compensation for injuries caused by the prohibited discrimination is another); International Bhd. of Teamsters v. United States, 431 U.S. 324, 364 (1977) (deterrence and compensatory purposes are "equally important"); Albermarle Paper Co. v. Moody, 422 U.S. 405, 417-18 (1975)(noting that monetary damages encourages compliance and making discrimination victims whole). Such make-whole relief restores the victim to the position he would have been in but for the discrimination. McKennon, 513 U.S. at 362 (object of compensation is to restore the employee to the position he or she would have been in absent the discrimination). Hence, contrary to North Gibson's assertions, the fact that the EEOC seeks compensation for seven victims who were subject to discrimination because of North Gibson's ERP does not make the Commission's enforcement efforts insignificant to the public interest. Notably, the Supreme Court has stated that the remedial objectives of the ADEA are furthered when it is established that the employer has discriminated against even one employee. Id. at 358. ("[t]he private litigant who seeks redress for his or her injuries vindicates both the deterrence and the compensation objectives of the ADEA"). Having brought this ADEA action on behalf of seven individuals who suffered compensable injuries, the EEOC's enforcement of the ADEA and vindication of their rights would greatly serve the public interest. This litigation has disclosed "patterns of noncompliance resulting from a misappreciation of the Act's operation or entrenched resistance to its commands, either of which can be of industry-wide significance." Id. at 358-59 ("incidents or practices that violate national policies respecting nondiscrimination in the work force is itself important"). In addition, compensation of these victims would further the remedial aim of the ADEA. In contrast, having determined that North Gibson has violated the law and affected the rights of many, barring recovery of monetary relief for them on the mistaken belief that such remedy does not serve the public interest would undermine "the ADEA's objective of forcing employers to consider and examine their motivations, and of penalizing them for employment decisions that spring from age discrimination." Id. at 362. Alternatively, even if the EEOC's monetary claims had to be based on timely charges, the Commission has identified discrete instances of alleged discrimination within the relevant time period upon which it can base its complaint. On summary judgment, the facts are to be viewed in the light most favorable to the nonmovant, in this case the EEOC. Anthis and Schleter filed their ADEA charges with the EEOC on December 31, 1997. To be timely, North Gibson's discriminatory plan must have been in operation at least 180 days prior to the filing of their charges, which means discrimination must have occurred on or around June 30, 1997. To show that their charges were timely, the EEOC submitted evidence that North Gibson's discriminatory plan may have been still in effect on or after July 1, 1997. The EEOC offered evidence that the union negotiator believed that the terms of the plan would remain in effect until a new plan was approved. EEOC Br. at 27. Additionally, because it is settled law that a facially discriminatory policy discriminates each time it is applied, Lorance v. AT&T Technologies, Inc., 490 U.S. 900, 912 n.5 (1989), and North Gibson concedes that David Specht was paid retirement benefits pursuant to its unlawful age-based retirement plan as late as October 1997, NG Br. at 32; A12, a reasonable jury could conclude that discrimination was ongoing. Further, as the Commission argued in its opening brief, a reasonable jury also find that the benefits paid to Noel Loftin after he retired on June 30, 1997 were effectively payments under the discriminatory plan. EEOC Br. at 27-28. Thus, summary judgment on this basis was inappropriate. 3. Anthis and Schleter are Entitled to Injunctive Relief The Commission acknowledges that North Gibson no longer has a discriminatory ERP in effect, but maintains that injunctive relief is still warranted. "[T]he express language of the ADEA, as well as this Court's precedent, establishes that a court may award injunctive relief to ensure that employees who choose not to retire because of the discriminatory terms of an early retirement plan receive the full amount of benefits available under the plan." EEOC Br. at 29. Since Anthis and Schleter chose not to retire under North Gibson's discriminatory ERP, despite their eligibility, the Commission is entitled to injunctive relief on their behalf consistent with the remedy upheld by this Court in Solon v. Gary Community School Corp., 180 F.3d 844 (7th Cir. 1999). EEOC Br. at 30-31. Several factors weigh in favor of imposing this injunction. In addition to the fact that the elimination of the discriminatory policy did not afford the claimants full relief, there is a strong possibility that North Gibson and the union could engage in future discrimination. Key officials, such as the union chief negotiator Cathy Heck and North Gibson's superintendent Sandy Nixon, were central to the development and implementation of the discriminatory plan, are still in control of the negotiation process for future retirement plans, and have aided North Gibson's efforts to avoid the remedial consequences of the discriminatory plan. EEOC v. Ilona of Hungary, Inc., 108 F.3d 1569, 1579 (7th Cir. 1997) (injunctive relief is particularly appropriate where the "individuals who were found to have discriminated remain the defendant's primary decision-makers"). Accord See EEOC v. New York Times Broadcasting Serv., Inc., 542 F.2d 356, 361 (6th Cir. 1976) ("we agree with the EEOC that the voluntary changes effectuated by the defendant, as salutary as they may be, do not render moot the questions presented in the litigation or make judicial sanctions inappropriate"); Sprogis v. United Air Lines, 444 F.2d 1194, 1202 (7th Cir.), cert. denied, 404 U.S. 991 (1971) (injunctive relief is proper to erase problems that elimination of discriminatory policy did not accomplish). In rebuttal, North Gibson contends that EEOC is now pressing a "new" argument for injunctive relief--namely that the court should order North Gibson to pay to Anthis and Schleter the maximum benefits to which they would have been entitled under the discriminatory plan when they do retire--and that the EEOC waived that argument since it was not raised in the district court and EEOC did not cite or argue Solon to the district court. NG Br. at 17-19. However, the Commission's request for an injunction to protect the retirement benefits to which Anthis and Schleter would have been entitled but for North Gibson's discriminatory ERP, is not new. At all times during the course of this litigation, the EEOC has made clear that it sought relief necessary to make whole those individuals whose early retirement benefits were or are being unlawfully withheld as a result of the discriminatory ERP. Make-whole relief includes restraining the continued withholding of amounts owing, with prejudgment interest, and providing affirmative relief to all individuals adversely affected by the discriminatory plan necessary to eradicate the effects of its unlawful practices. See, e.g., R.1 at 3; R.20 at 5. Moreover, the Commission expressly stated in its opposition to North Gibson's first dismissal motion, that it was seeking relief pursuant to section 217 of the ADEA because it authorizes a district court to restrain an employer from "any withholding payment of minimum wages or overtime compensation." R.20 at 5 (quoting 29 U.S.C. § 217). Thus, the Commission's current argument for injunctive relief for Anthis and Schleter is identical to the claims it pressed in the district court. Next, North Gibson asserts that the EEOC's "new" argument is without merit because Solon is factually distinguishable. It argues that Solon is irrelevant to this case because the Gary school corporation in Solon had not abandoned its ERP, as North Gibson had, and thus the district court in that case was not faced with a situation where there was no current discriminatory plan in effect. NG Br. at 19. In addition, it asserts that the Gary School Corporation did not challenge on appeal the injunction imposed by the district court, thus the Solon Court did not address the issue raised by the EEOC in this appeal. Id. Despite those differences, Solon remains instructive on the type of relief available to Anthis and Schleter as current North Gibson employees and thus, the distinguishable aspects of Solon do not make it inapplicable to the instant case or undermine the Commission's argument that injunctive relief for Anthis and Schleter is not moot. Similar to Anthis and Schleter, the claimants in Solon included teachers who opted to continue to work even though they were eligible to retire and receive the maximum benefits. This Court noted that while "teachers and administrators who choose not to retire suffer no loss in position, salary, or other benefits, . . . and almost certainly earn more in salary and benefits by continuing to work than they have forfeited by declining to retire at 58," Solon, 180 F.3d at 853, the point is "not that they were never eligible for the incentives, but that the terms of the plans put them to an unlawful choice" of either retiring sooner than they had planned or continuing to work and forfeiting some of the early retirement incentives. Id. Thus, Solon makes clear in this case that Anthis and Schleter could have suffered a cognizable and redressable injury as a result of North Gibson's ERP even though they did not retire while it was still in effect. Further, to the extent that Gary School Corporation complained that the plaintiffs who had not retired under discriminatory plan had been given a "windfall" because they were awarded "the right to receive the benefits" offered by its discriminatory ERP, this Court stated that such relief "may simply be the price Gary Schools has to pay . . . for establishing an early retirement plan which turns on the employee's age." Id. at 855-56. In other words, this Court resolved that the injunctive relief ordering the payment of damages was appropriate. Applying those conclusions to this case, the Solon Court's analysis strongly suggests that the Commission's claim for injunctive relief on behalf of Anthis and Schleter is viable and thus cannot be moot. Ilona of Hungary, 108 F.3d at 1578-80 (once employment discrimination has been shown, district judges have broad discretion to issue injunctions addressed to the proven conduct and recreate the conditions and relationships that would have existed if the unlawful discrimination had not occurred). Accord EEOC v. Kidder Peabody, 156 F.3d 298, 303 (2d Cir. 1998) (under ADEA, "the EEOC remains armed with the power to seek injunctive relief which calls in many cases for continuing judicial oversight of employers"). Finally, North Gibson also argues that injunctive relief for Anthis and Schleter is unavailable because the EEOC has not proven they chose not to retire while the discriminatory plan was in effect. NG Br. at 20. Of course this argument relies on a fundamental misreading of the Commission's burden in response to a motion to dismiss. See Jenkins v. McKeithen, 395 U.S. 411, 421 (1969) ("[f]or purposes of a motion to dismiss, the material allegations of the complaint are taken as admitted[; a]nd, the complaint is to be liberally construed in favor of plaintiff"); Holman v. State of Indiana, 211 F.3d 399, 402 (7th Cir. 2000) (same). Even though, as North Gibson contends, in 1995 neither Anthis nor Schleter informed North Gibson of its desire to retire<1> or filed a grievance with the union or the EEOC challenging the discriminatory plan, NG Br. at 20, accepting the factual allegations as true and making all reasonable inferences in favor of the EEOC, the Commission's injunctive relief claim on their behalf still should have survived dismissal. Indeed, North Gibson concedes that its challenged plan was in effect during Anthis and Schleter's employment and has never contended they were not eligible to retire in 1995. Id. Further, both teachers alleged that they would have retired in 1995 but for the discriminatory plan and in fact continued to work despite being retirement-eligible. Finally, both ultimately raised their concerns in a formal fashion because they eventually filed charges with the EEOC alleging that North Gibson's ERP discriminated on the basis of age. Hence, viewing the facts in the light most favorable to the EEOC, Anthis and Schleter could have been victims of discrimination entitled to the same injunctive relief the district court awarded to the Solon claimants and the EEOC should have been given a chance to prove their entitlement, despite the fact that North Gibson discontinued its discriminatory plan. See Harris Chernin, 10 F.3d at 1292 (reversing summary judgment on injunction claim because EEOC is entitled to prove "Chernin discriminated against Rosenthal and whether, if it did, it acted willfully or under such circumstances that an injunction would be appropriate"); cf. New York Times, 542 F.2d at 362 (upholding issuance of injunctive relief despite employer's voluntary elimination of discriminatory practices and fact that claimant on whose behalf case was brought "was not damaged by defendant's refusal to hire her even assuming that the decision was based upon sex"). This conclusion is not defeated by North Gibson's argument that the EEOC has conceded in other cases that when the alleged discrimination discontinues, injunctive relief is not available or because, damages in the form of payment of those retirement benefits that were unlawfully withheld would be the appropriate relief. Id. at 20-21. Indeed, North Gibson's argument that the EEOC cannot distinguish its concession in EEOC v. ElginTeachers Ass'n, 658 F.Supp. 624 (N.D.Ill. 1987), from the facts of this case misses the mark. In Elgin, the Commission acknowledged that the Association was no longer discriminating against pregnant teachers through the challenged provisions of the Association's collective bargaining agreement, and thus the court concluded that EEOC's claim for injunctive relief was moot. Id. at 626. In this case, despite the discontinuance of North Gibson's ERP, the EEOC has never conceded that school corporation is not still discriminating against its former and current teachers because it still withholds full retirement benefits from those who did and could have retired under the discriminatory plan. Similarly, North Gibson's reliance on Kidder Peabody is misplaced. In Kidder, the EEOC sought monetary relief and reinstatement for investment bankers who had been terminated on the basis of age. 156 F.3d at 300. When Kidder discontinued its investment banking operations, the EEOC stipulated that it no longer sought injunctive relief since a nonexistent division cannot discriminate. Id. Here, even though the discriminatory retirement policy has been abandoned, the union and the school corporation that participated in its development and enforcement still exist. Further, two of the individuals on whose behalf the Commission has brought suit remain employed by the school district. See Ilona of Hungary, 108 F.3d at 1579 (injunctive relief is justified where the individuals who discriminated remain the defendant's primary decision-makers and the victim remains in the defendant's employ). Therefore, these cases do not negate the Commission's position that Anthis and Schleter are entitled to an injunction that protects them from future discrimination in the form of reduced payments rather than the maximum benefits to which they would have been entitled under the challenged plan but for discrimination. 4. The Commission's Claims Are Not Barred by Laches Although the district court apparently rejected this argument, North Gibson urges this Court to hold that this action is barred by the doctrine of laches in that the monetary relief the EEOC sought would only benefit private individuals. It argues that the EEOC's lawsuit was unreasonably delayed and prejudicial because the EEOC knew or should have known that North Gibson had a discriminatory ERP earlier than December 1997, and it "did nothing to educate Indiana School Corporations or prevent them from adopting and/or using alleged discriminatory ERPs." NG Br. at 34. In addition, it argues that the "EEOC's interests in this litigation are purely self-centered without regard for a just result, the public's interest or the promotion of the principles embodied in the ADEA." Id. at 40. Accordingly, it concludes, the doctrine of laches should apply. Id. at 41. This argument lacks merit. The defense of laches requires a showing of (1) unreasonable delay on the part of the plaintiff in filing suit and (2) harm or prejudice to the defendant's ability to present an adequate defense. Martin v. Consultants & Administrators, Inc., 966 F.2d 1078, 1091 (7th Cir. 1992). Here, the elements of laches cannot be satisfied because there was no unreasonable delay in filing the EEOC's ADEA action against North Gibson.<2> In December 1997, the EEOC received charges from Anthis and Schleter alleging that North Gibson had a retirement plan that discriminated on the basis of age. See A45-46. Following an investigation and conciliation efforts, the EEOC filed this ADEA action against North Gibson on September 3, 1998, less than a year after the filing of the charges. Prior to the discrimination charges filed by Anthis and Schleter, the EEOC had no information or knowledge about the discriminatory early retirement provisions used by North Gibson. In dispute, North Gibson argues the EEOC delayed unreasonably in filing suit because the EEOC knew or should have known that North Gibson had a discriminatory ERP earlier than December 1997 since the agency was involved in litigation challenging the ERPs of other Indiana school corporations since May 1992 and since in June 1996, Ira Horall, a teacher employed by North Gibson, filed an ADEA charge alleging that he was being forced to retire and the school board allegedly was offering a "good deal" for those at retirement age. NG Br. at 34-38. Contrary to North Gibson's assertions, neither the Commission's knowledge of discriminatory ERPs used by other Indiana school corporations nor Horall's EEOC charge provided such information. Indeed, nothing in the Crown Point litigation implicated North Gibson's ERP, and the court's ruling that Crown Point's ERP violated the ADEA did not issue until January 2, 1997, only eleven months prior to the EEOC's investigation of Anthis' and Schleter's charges. Further, North Gibson's contention that the EEOC should have prevented other Indiana school corporations from adopting or using discriminatory ERPs because it knew that Crown Point's superintendent had shared its contract with his colleagues in Locke and Porter Township and that the plan was a "prototype" in the area lacks logic. The sharing of the discriminatory plan with two school corporations does not necessarily lead to the conclusion that the plan was shared with or adopted by North Gibson and the existence of a discriminatory prototype is not in itself an ADEA violation. Moreover, even if "by the end of 1995, the EEOC had filed its Complaint in Crown Point" and had charges pending against Middlebury, Hanover, and Gary Community School Corporations, these distinct violations, even lumped together, do not provide notice that overall Indiana school corporations, and particularly North Gibson, had early retirement plans that discriminated on the basis of age. Cf. Martin, 966 F.2d at 1086 (information that suggests "something is awry" does not constitute actual or constructive knowledge of a violation). Indeed, the absence of any evidence that the adoption of this illegal language by Indiana school corporations was common practice is demonstrated by the fact that when Cathy Heck, a UniServ Director for the Indiana State Teachers Association ("ISTA") received a memorandum about the Crown Point decision, she reviewed the collective bargaining agreements of the ISTA affiliates she represented and only found two affiliates, one of which was North Gibson, with ERPs similar to the one in Crown Point. NG Br. at 9-10. Finally, Horall's ADEA charge against North Gibson provided no basis upon which the EEOC could conclude North Gibson used a discriminatory ERP. In contrast to the charges filed by Anthis and Schleter, Horall's complaint that he had been "forced to retire" or that he had been told North Gibson offered a "good deal" for retirees did not suggest that the terms of the ERP itself were themselves discriminatory or age-based. Rather, his claim of age discrimination suggested that North Gibson "'manipulated the options so that [he] was driven to early retirement not by its attractions but by the terror of the alternative.'" Solon, 180 F.3d at 851 (quoting Henn v. National Geographic Soc'y, 819 F.2d 824, 829 (7th Cir.), cert. denied, 484 U.S. 964 (1987)). Hence, Horall's allegations were not equivalent to the claims raised in this case, where the EEOC is not contending that anyone was pressured to retire early or suffered a detriment in their employment conditions, such as a loss in pay or position, because they chose to continue to work rather than retire. Rather, the Commission's claim "is that the way in which eligibility for participation in the [ERPs] is defined by age is in itself discriminatory." Solon, 180 F.3d at 851. Therefore, there was no reason to request North Gibson's ERP during the investigation of Horall's 1996 charge and no reason to suspect that the ERP violated the ADEA until Anthis' and Schleter's charges were filed in December 1997. Cf. Henn, 819 F.2d at 828 (because an "offer of early retirement is beneficial to the recipient, there is no reason to treat every early retirement as presumptively an act of age discrimination"). Even if there was a reason to request the ERP when investigating Horall's charge, the filing of a suit a mere 18 months after that charge was filed does not constitute an unreasonable delay. Given these circumstances, the filing of the Commission's action against North Gibson in September 1998, nine months after the 1997 charges were filed and less than two years after the first court ruling on this issue, cannot be reasonably viewed as unreasonable. Congress gave the EEOC the authority to litigate selectively those cases which it believes will have the most significant public impact, EEOC v. Waffle House, 193 F.3d 805, 810 (4th Cir. 1999), and this Court discourages EEOC investigations that appear to be "fishing expeditions. Cf. Harvey Walner, 91 F.3d at 971-72 ("discovery is not to be used as a fishing expedition"); EEOC v. Maryland Cup, 785 F.2d 471, 479 (4th Cir.1986) (Congress did not intend EEOC to use its investigatory subpoena powers to conduct fishing expeditions). Accordingly, the Commission's decision to investigate North Gibson after it received charges explicitly alleging that its ERP was discriminatory was prudent because, as this Court has acknowledged: workers rely on early retirement programs, just as they rely on the validity of seniority systems. Early retirement is a valued contractual right, something many employees work for and look forward to. A suit challenging an early retirement system could result - as this suit did - in an employer's decision to scuttle its early retirement plan rather than face more litigation and greater potential liability. This would deprive long-term employees of a valuable benefit they had every right to expect to receive. EEOC v. City of Colleges of Chicago, 944 F.2d 339, 343 (7th Cir. 1991). Therefore, because any "delay" the EEOC incurred in filing its action is justified, the inconveniences North Gibson suffered in defending against this suit should not bar the EEOC's claims.<3> 5. Kimel is Inapplicable North Gibson argues that the EEOC's action is barred by Kimel because the Supreme Court invalidated Congress's 1974 Amendment to the ADEA, and thus local government entities, such as school corporations in the state of Indiana, cannot be sued for ADEA violation. See NG Br. at 41-42. This argument is completely baseless.<4> First, Kimel precluded private individuals, and in particular state employees, not federal agencies from suing states for ADEA violations. Kimel, 120 S.Ct. at 650 (holding that "in the ADEA, Congress did not validly abrogate the States' sovereign immunity to suits by private individuals"). Thus, Kimel does not apply to ADEA suits by the EEOC. See Alden v. Maine, 527 U.S. 706, 755 (1999) ("[i]n ratifying the Constitution, the States consented to suits brought by other states or by the Federal Government"). If, however, the EEOC's claims for monetary relief were somehow deemed "private" in nature because only seven claimants would be compensated, and thus the Commission's action were treated as if it were a suit by private individuals (a result that would be erroneous for all the reasons discussed herein and in the Commission's opening brief), North Gibson would have to demonstrate that it is entitled to Eleventh Amendment immunity to avoid liability for damages arising from the ADEA violations. This it cannot do. See Alden, 527 U.S. at 756 (sovereign immunity bars suits against States but not against lesser entities, such as municipal corporations); Board of Trustees Hamilton v. Landry, 638 N.E.2d 1261, 1263 (Ind.App.1994) (Indiana school corporation was not arm of state entitled to Eleventh Amendment immunity). In like manner, North Gibson cannot draw any support from what it considers the "well reasoned opinion" in Bailey v. Canan, 82 F.Supp.2d 966, 978 (S.D.Ind. 2000) based on its holding that, with respect to ADEA suits, "federal courts do not have jurisdiction over local government entities." NG Br. at 42. Unlike the instant action, Bailey was a private ADEA suit against a city, and its holding that, based on Kimel, it "appear[ed]" to lack jurisdiction to decide a private individual's age discrimination claims, Bailey, 82 F.Supp.2d at 978, falls far short of "well reasoned." In fact, because the opinion lacks any substantive analysis, another district court in Indiana declined to follow its holding. See Braaksma v. Wells Community Hosp., 98 F.Supp.2d 1026, 1030 (N.D.Ind. 2000) (declining to adopt holding in Bailey because that "court did not engage in any analysis before concluding that it did not have jurisdiction over an ADEA suit against the City of Muncie"). Moreover, contrary to the holding in Barnes v. Anne Arundel Cty. Bd. of Educ., 2000 WL 979108 (D.Md. July 14, 2000), that a local county board education was immune from an ADEA suit, most courts, including this Court, have declined to extend Eleventh Amendment immunity to local school districts and boards. See, e.g., Mt. Healthy City School Dist. Bd. of Educ. v. Doyle, 429 U.S. 274, 280 (1977) (holding that an Ohio city school board did not enjoy Eleventh Amendment immunity, because the board was "more like a county or city than ... like an arm of the State" and under state law, school districts were "political subdivisions," which were not included in the legal definition of "State"); Gary A. v. New Trier High School Dist., 796 F.2d 940, 945 (7th Cir.1986) (Illinois school district and board); Horowitz, 2000 WL 1100858*3 (despite Kimel, school boards in Illinois do not enjoy Eleventh Amendment protection); also see Narin v. Lower Merion School Dist.,206 F.3d 323, 331, n.6 (3d Cir.2000) (Pennsylvania school district); EEOC v. Hickman Mills Consolidated School District No. 1, 99 F.Supp.2d 1070, 1080 (W.D. Mo. 2000) (Kimel is inapplicable because school districts are not entitled to Eleventh amendment immunity). Therefore, considering North Gibson's assertion of Eleventh Amendment immunity largely relies on its misapprehension of the Supreme Court's decision in Kimel, the district court properly rejected North Gibson's claim of sovereign immunity and denied its motion to dismiss. CONCLUSION It is the function of the jury as the traditional factfinder in ADEA cases to weigh conflicting evidences and inferences. Therefore, this Court should reverse the district court's erroneous decisions granting summary judgment on and dismissing the EEOC's ADEA claims and remand the case for further proceedings. Respectfully submitted, C. GREGORY STEWART General Counsel PHILIP B. SKLOVER Associate General Counsel CAROLYN L. WHEELER Assistant General Counsel PAULA R. BRUNER Attorney EQUAL EMPLOYMENT OPPORTUNITY COMMISSION 1801 L Street, N.W. Rm. 7044 Washington, D.C. 20507 (202) 663-4731 CERTIFICATE OF COMPLIANCE I certify that this brief complies with the type-volume limitation set forth in Fed. R. App. R. 3(a)(7)(B). The brief contains 6,980 words. Paula R. Bruner CERTIFICATE OF SERVICE This is to certify that on December 27, 2000, two copies of the foregoing reply brief were mailed first class, postage prepaid, to the following counsel of record: Mary Lee Schiff, Esq. Wm. Michael Schiff, Esq. ZEIMER, STAYMAN, WEITZEL & SHOULDERS P.O. Box 916 Evansville, Indiana 47706 PAULA R. BRUNER Attorney EQUAL EMPLOYMENT OPPORTUNITY COMMISSION 1801 L Street, N.W., 7th Floor Washington, D.C. 20507 (202) 663-4731 December 27, 2000 1 North Gibson's contention that the failure of Anthis and Schleter to notify North Gibson of their desire to retire under the 1995 plan suggests they had no such intention is lacking. According to Sandra Nixon, superintendent of North Gibson, such notification was required if an employee were electing to retire, not if an employee were foregoing the opportunity because he was deterred by the discriminatory terms of the plan. R.15, Nixon Aff. at 3. 2 To demonstrate prejudice, North Gibson mentions that because of the EEOC's delay in bringing this action its liability for damages increased, "witnesses' memories have faded, witnesses have either passed away or moved out of town, and documents have either been destroyed or lost." NG. Br. at 39. 3 North Gibson's reliance on Chakonas v. City of Chicago, 42 F.3d 1132, 1136 (7th Cir. 1994), for the proposition that the law does not permit a plaintiff who is aware of his injury to wait until a court ruling is handed down, is ill-placed. Chakonas refers to private individuals who are victims of discrimination and fail to pursue their rights within the statute of limitations period for filing a charge. Despite North Gibson's contentions to the contrary, "the EEOC and charging parties are not interchangeable plaintiffs." Waffle House, 193 F.3d at 810-11. Unlike a private individual, the EEOC is not bound by any charge-filing period, and it has the power to investigate claims and bring actions independent of the statutory authority of individual employees to bring claims. American & Efird Mills, Inc., 964 F.2d at 301. Thus, Chakonas has no application to this case. 4 North Gibson's argument that the Supreme Court invalidated the entire 1974 Amendment is also erroneous. NG Br. at 41. As the district court in Horowitz v. Board of Educ. of Avoca, 2000 WL 1100858, *2-*3.(N.D. Ill. June 7, 2000), so aptly stated in rejecting a similar argument: In the instant case, Defendants would have us understand that the Kimel Court nullified the entire 1974 Amendment, . . . [and] urge us to interpret the Supreme Court's analysis of the limits placed by the Enforcement Clause on Congress's power to abrogate state immunity, as a general limitation on Congress's ability to apply the ADEA to government employers. Such a contention stretches the bounds of creative argumentation. While Kimel has announced that the Act is not a valid exercise of Congress's Enforcement Power, it does not follow that the Act is not valid at all, or that, as Defendants here inexplicably argue, the ADEA is invalid as it applies to local governments and school boards. * * * Individuals cannot sue a state perceived to be in violation of the ADEA. However, the other corners of this law remains as written, and employers who cannot claim Eleventh Amendment immunity can be held accountable to the substantive provisions of the Act by private cause of action.