Fincher v. Depository Trust and Clearing Corp., No. 08-5013 (2d Cir. May 14, 2009)

By Paul Mollica

Does an employer’s deliberate failure to investigate a complaint of discrimination constitute a stand-alone act of retaliation? The Second Circuit holds that it does not.

Fincher v. Depository Trust and Clearing Corp., No. 08-5013 (2d Cir. May 14, 2009): The plaintiff alleged that she complained to her employer’s human resources professional about unfair, racially biased treatment in the plaintiff’s department:  “In late March 2006, Fincher had a conversation with Charles Smith, the Senior Director of Employee Relations at DTCC, in the lobby of their office building. They were professional and social acquaintances who occasionally lunched together. According to Fincher, she complained to Smith that ‘black people were set up to fail at [the Auditing] department because they were not provided and given the same training opportunities as the white employees.’ ” Also allegedly, one week later, Smith admitted to the plaintiff that he was not going to open up an investigation of her claim of race discrimination. Fincher resigned and filed her § 1981 and New York state and city law claims for retaliation.

Affirming summary judgment, the panel holds that the employer’s alleged failure to investigate discrimination was not in itself an “materially adverse action” subject to retaliation liability. Under Burlington N. & Santa Fe Ry. Co. v. White, 548 U.S. 53, 67-8 (2006), “a plaintiff must show that a reasonable employee would have found the challenged action materially adverse, which in this context means it well might have dissuaded a reasonable worker from making or supporting a charge of discrimination.” The panel holds that not investigating a complaint does not fall into this category:

“An employee whose complaint is not investigated cannot be said to have thereby suffered a punishment for bringing that same complaint: Her situation in the wake of her having made the complaint is the same as it would have been had she not brought the complaint or had the complaint been investigated but denied for good reason or for none at all. Put another way, an employee’s knowledge that her employer has declined to investigate her complaint will not ordinarily constitute a threat of further harm, recognizing, of course, that it would hardly provide a positive incentive to lodge such a further challenge.

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“[A] reasonable employee in Fincher’s place had nothing to lose by bringing this complaint, or another one following it, because the result of bringing the complaint and not bringing the complaint under the conditions alleged was the same: the complaint would not be investigated. No action has been attributed to the defendant here except for the disposition — or lack thereof — of the same complaint that allegedly provoked the retaliatory response.”

The panel expresses concern that a contrary rule would give the employee a claim even if the underlying complaint of discrimination were false, and the employer knew it was false:  “If the miffed accused employer were, because of his or her anger, to decline to investigate what was in fact a false claim, the employee might have a viable suit for retaliatory failure to investigate.” The panel goes on to hold that the result would be the same under the New York state and city anti-discrimination laws.

So presumably, an employer’s failure to follow up on a complaint of harassment — even if direcly motivated by the manager’s resentment that the employee made a complaint in the first place — cannot be retaliation as a matter of law.  Of course, for a union, it has long been the case that a failure to grieve a complaint can violate the discrimination provisions of Title VII (Goodman v. Lukens Steel Co., 482 U.S. 656 (1987)), and thus constitutes an “adverse action,” but this example is not cited or distinguished in the opinion.