July 5, 2022

Volume XII, Number 186

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Seventh Circuit Expands § 1981 Coverage to Include Individual Liability for Retaliation Under “Cat’s Paw” Theory

The Seventh Circuit has held that an employee with an unlawful retaliatory motive may be individually liable under § 1981 for causing an employer to retaliate against a co-worker.  Section § 1981 prohibits racial discrimination in contractual relations and has been held applicable to employment matters. 

In Smith v. Bray, the Seventh Circuit tackled this issue of first impression by looking to recent Supreme Court precedent endorsing the “cat’s paw” theory of employer liability under Title VII and the holdings of five circuits that the “cat’s paw” theory supports individual liability under § 1983, which provides redress for individuals whose federally protected rights have been violated.  As such, the Court held that “recognizing cat’s paw liability under § 1981 is consistent with our parallel approaches to these [non-discrimination] statutes.” 

The “cat’s paw” theory, which was recognized by the Supreme Court in Staub v. Proctor Hosp., 131 S. Ct. 1186 (2011), says that an employer may be liable for discrimination under Title VII where an adverse employment decision is based on a biased or improperly motivated recommendation by a subordinate or supervisor.  “Cat’s paw” liability may be established where a plaintiff can show that an employee with a discriminatory purpose or bias provided information that may have affected an adverse action.  The theory comes from a French fable wherein a monkey (the biased employee) convinces a cat (the employer) to pull chestnuts from a hot fire.  The cat’s paw is then burned and the monkey enjoys the fruits of the cat’s labor.  In holding that the “cat’s paw” theory can support individual liability under § 1981, the court inquired, “Why should the ‘hapless cat’ (or at least the employer) get burned but not the malicious ‘monkey’?”

This decision is noteworthy not just because it endorses individual liability under § 1981, but also because it provides an arrow in a plaintiff’s quiver which is not available under Title VII as most circuits have held that an individual cannot be liable under Title VII.  As far as race discrimination is concerned, however, Smith v. Bray opens the door for suits against supervisors and co-workers under a “cat’s paw” theory.

© 2022 Faegre Drinker Biddle & Reath LLP. All Rights Reserved.National Law Review, Volume II, Number 183
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Drinker Biddle’s Labor and Employment Practice provides businesses with a full range of employment-related legal services. Our clients include a broad range of foreign and domestic corporations, including industrial manufacturers, retailers, nonprofit educational and public institutions, health care organizations, financial services providers and consulting firms. For many of these clients, we serve as national counsel for labor and employment matters, especially in the retail and financial services industries. We are committed to providing real-time, real-world...

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