Pursuant to this Court’s September 1, 2016, order [ECF 48], the Equal Employment Opportunity Commission submits this Reply to Dignity Health’s (Chandler’s) Response to EEOC’s Brief as Amicus Curiae. In its initial brief, the Commission argued that Defendant’s motion to dismiss should be denied because Robinson stated a plausible claim for relief under T itle VII when he alleged that Defendant discriminates on the basis of sex by refusing to cover medically necessary treatment for his gender dysphoria, where the plan would cover medically necessary treatment for other serious health conditions. The Commission also addressed arguments Defendant made to support its motion to dismiss the complaint.

As is apparent from the absence of relevant citations to EEOC’s Brief, Dignity Health’s Response largely ignores EEOC’s actual arguments. Instead, Defendant distorts arguments EEOC did make, addresses arguments EEOC did not make, and quotes at length from cases even Defendant has trouble linking to the case at hand. Nothing in the Response undermines the Commission’s bottom-line position that Defendant’s motion to dismiss should be denied because the complaint states a plausible claim for relief.

I. ARGUMENT

A. Dignity Health’s Response Distorts EEOC’s Arguments and Addresses Arguments EEOC Did Not Make

Dignity Health’s principal discussion of the substance of EEOC’s Brief begins on page 8 of its Response. [See ECF 47, at pp. 8:6-12:27] Dignity Health makes two arguments, neither of which has merit. [1]

1. EEOC Never Argued that this Court Should Find that Robinson is Covered Under a New T itle VII Classification Called “Transgender Status”

According to Dignity Health, EEOC takes the position that “transgender status” is or should be a separate category of coverage under Title VII. Defendant argues that EEOC attempts to “force a transgender status theory into the sex stereotyping mold” that courts have recognized and adopted. But, Defendant continues, “[n]othing in Price Waterhouse [or other cases cited by the Commission] supports extending [the] holding or reasoning outside the stereotyping context.” [ECF 47, at pp. 8:18-19, 9:2, 10:24-25, 11:11-12]

This argument responds to arguments Dignity Health may wish EEOC had made, rather than ones it actually did make. In fact, the Commission has not argued that “transgender status” is a separate protected category that this Court should create in resolving Robinson’s suit. Indeed, EEOC’s Brief uses the term “transgender status” only six times, three times referring to Plaintiff’s complaint [ECF 43-1, at pp. 3:8, 4:28, 12:5] and three times responding to Defendant’s use of the term [id., at pp. 3:13, 6:25, 8 n.4]. It is not a term that EEOC used in an affirmative argument.

What EEOC did argue, consistently throughout its brief, is that the allegations in the complaint state a plausible claim of coverage under a sex stereotyping/gender nonconformity theory that flows directly from Price Waterhouse v. Hopkins, 490 U.S. 228, 240 (1989). The Commission stated, “discrimination against transgender individuals” such as Robinson “because of their gender nonconformity is discrimination on the basis of sex.” [ECF 43-1, at p. 1:15-17] As authority, the Commission cited a series of cases that fully support what EEOC is arguing. For example, EEOC cited Schwenk v. Hartford, 204 F.3d 1187, 1202 (9th Cir. 2000). [See ECF 43-1, at pp. 4:23, 6:2-4] Schwenk describes Price Waterhouse, 490 U.S. at 240, as holding that Title VII barred “discrimination based on the fact that [plaintiff] failed ‘to act like a woman’ — that is, to conform to socially-constructed gender expectations.” Schwenk further explains that Title VII prohibits discrimination “because one fails to act in the way expected of a man or woman” — as is true for transgender individuals such as Robinson. EEOC also cited Smith v. City of Salem, 378 F.3d 566, 572 (6th Cir. 2004) [ECF 43-1, at p. 6:7], which, in holding that the transgender plaintiff was covered by Title VII’s ban on sex discrimination, states that “[s]ex stereotyping based on a person’s gender non-conforming behavior is impermissible discrimination.” In our view, to the extent Robinson alleges that he was the victim of discrimination because, as a transgender man, he fails to “conform to socially constructed gender expectations” — by seeking to change his female-appearing body to match his male gender identity — those allegations state a plausible claim that the discrimination is because of sex.

The Commission further relied on Glenn v. Brumby, 663 F.3d 1312, 1316 (11th Cir. 2011), which refutes the notion that there is some necessary distinction between sex stereotyping and “transgender status.” Glenn explained that “[a] person is defined as transgender precisely because of the perception that his or her behavior transgresses gender stereotypes. ‘[T]he very acts that define transgender people as transgender are those that contradict stereotypes of gender-appropriate appearance and behavior.’” Id. at 1316 (citation omitted). The Court continued, “There is thus a congruence between discriminating against transgender and transsexual individuals and discrimination on the basis of gender-based behavioral norms” (id.). [ECF 43-1, at p. 11:5-10] Finally, the Commission cited Macy v. Holder, Appeal No. 0120120821, 2012 WL 1435995 (EEOC April 20, 2012), which analyzed Price Waterhouse, Schwenk, Smith, and Glenn, as well as Schroer v. Billington, 577 F.Supp.2d 293 (D.D.C. 2008), and concluded, in accordance with those cases, that “discrimination against a transgender individual because he or she is transgender is, by definition, discrimination ‘based on ... sex,’” and therefore violates Title VII. [ECF 43-1, at p. 6:10-14 (quoting Macy)]

Dignity Health argues that those cases do not stand for the proposition that Title VII prohibits discrimination against transgender individuals outside the context of a sex stereotyping/gender nonconformity theory. [ECF 47, at pp. 8:18-9:1-21] The Commission agrees that the cases do not hold that transgender status is a separate category of Title VII coverage. Our point is that discrimination against transgender individuals is inherently a form of sex stereotyping. The cases apply Price Waterhouse’s sex stereotyping analysis to plaintiffs who, because they are transgender, fail to conform to socially constructed gender expectations. See, e.g., Glenn, 663 F.3d at 1316 (noting “congruence” between discriminating against transgender individuals and discrimination based on gender-based behavioral norms). Defendant’s attempts to explain why the cases do not support EEOC’s argument are unpersuasive. [See, e.g., ECF 47, at p. 5:10-13 (citing Schwenk); p. 8:12-17 (citing ECF 43-1, at p. 4:19-21) (”Discrimination against an individual like Plaintiff based on the fact that, although assigned the female sex at birth, he fails to act in the way expected of a woman[,] constitutes discrimination on the basis of sex”) (emphasis added by Defendant). There is no discrepancy between EEOC’s position and the parentheticals in Defendant’s list of cases. [ECF 47, at pp. 8:18-9:21]

Nor does Dignity Health cite anything suggesting that EEOC is seeking to create a new category for coverage under Title VII. Defendant seems to assume that Plaintiff’s use of the term “transgender status” in his complaint and EEOC’s statement that the complaint states a plausible claim for relief mean that Plaintiff — and, so, EEOC — are asking the court to add a new category for “transgender status” to Title VII’s list of protected classifications. [See, e.g., ECF 47, at pp. 10:23-25, 11:9-12; see also p. 6:5-9 (quoting EEOC v. RG&GR Harris Funeral Homes, 2:14-cv-13710, 2016 WL 4396083, at *20 & n.15 (E.D. Mich. Aug. 18, 2016))] Any such assumption is unfounded. As EEOC understands it, Plaintiff is using the term “transgender status” as a shorthand for the fact that Plaintiff is transgender and therefore by definition does not “conform to socially-constructed gender expectations.” Schwenk, 204 F.3d at 1201-02. Indeed, the complaint uses the term interchangeably with “gender nonconformity.” [See, e.g., ECF 1, at ¶54 (“transgender status or gender nonconformity”)] As Schwenk, Smith, and Glenn all recognize, discrimination against a transgender individual because of his gender nonconformity — his transgender status — is discrimination on the basis of sex. There is no need to create a new protected classification.

Dignity Health further stresses that “a court cannot read Title VII to protect a category that Congress has not acted to protect.” [ECF 47, at p. 10:9-10] That is beside the point since EEOC is not arguing that the Court should create a new “category.” EEOC cited numerous cases where courts interpreted existing classifications to encompass subsets of that classification, as, for example, unfeminine women and unmanly men as subsets of “sex.” [ECF 43-1, at pp. 7:13-8:5 (citing, e.g., Price Waterhouse, 490 U.S. at 251; Nichols v. Azteca Rest. Enters., 256 F.3d 864, 874 (9th Cir. 2001))] Defendant attempts to distinguish these cases, asserting that “interpreting existing categories is a different exercise from adding new categories, as the EEOC ... ask[s] the Court to do.” [ECF 47, at p. 10:23-25] To repeat, EEOC is not asking the court to add new categories — there is no need to do so. Transgender/gender nonconformity fits comfortably within the existing category of “sex.” [2]

Based on the allegations in the complaint, there can be no doubt that Plaintiff here “fail[s] to conform to sex stereotypes concerning how a [woman — Plaintiff’s birth-assigned sex —] should look and behave.” Glenn, 663 F.3d at 1318 (citation omitted). According to the complaint, he has been taking male hormones, has had a double mastectomy, and is seeking medically necessary phalloplasty surgery. [ECF 1, at ¶¶ 38-42] That is not behavior stereotypically associated with individuals of Plaintiff’s birth-assigned sex. Defendant never explains why it does not fall squarely into the category of gender non-conforming behavior.

2. Dignity Health Does Not Respond to EEOC’s Arguments Concerning
the Exclusion in the Health Plan for “Sex-Transformation”-Related Treatment

Regarding the exclusion in Dignity Health’s employee health plan for treatment, drugs, and services for or leading to “sex transformation surgery,” EEOC mainly argued that the allegations of disparate treatment in Plaintiff’s complaint state a plausible claim for relief under Title VII. The Commission noted that the exclusion is not facially neutral since it targets and is limited to persons seeking “sex transformation surgery,” all of whom are transgender. [ECF 43-1, at p. 12:15-18 & n.6] The Commission also analogized to Glenn, noting that this Court could reasonably infer that, like the decisionmaker in that case (663 F.3d at 1320-21), Dignity Health is, at the very least, “uncomfortable” with employees’ gender non-conformity and the fact that they seek to change their bodies to conform to their gender identity. [ECF 43-1, at pp. 9:14-10:1]

Dignity Health takes issue with the latter suggestion, stressing that Plaintiff does not allege that he has suffered any adverse treatment at work because of his gender identity. [ECF 47, at p. 12:18-27] That is beside the point. EEOC’s focus — and Plaintiff’s — is on the plan exclusion that singles out and denies coverage for medically necessary treatment, including surgery, for “sex transformation purposes.” Title VII prohibits discrimination in employee benefits as well as in hiring and firing.

Dignity Health further argues that EEOC “fail[ed] to meaningfully address [Dignity Health’s] neutral policy.” [ECF 47, at p. 11:17-18] As noted above, EEOC argued that the allegations in the complaint state a plausible claim that the plan exclusion is not facially neutral. Defendant notes that Plaintiff did not allege a disparate impact claim [Id., at p. 12:4-5] — a non-sequitur to the extent the exclusion is facially discriminatory — but otherwise does not respond to EEOC’s argument. Repeatedly characterizing the exclusion as facially neutral adds nothing to the analysis. We therefore stand on our brief. [ECF 43-1, at pp. 12-13]

B. Dignity Health’s Other Arguments Do Not Suggest that Dismissal
is Appropriate

Dignity Health also addresses two arguments that Defendant acknowledges EEOC did not make.

First, Defendant argues that the Court should accord little or no deference to Macy, 2012 WL 1435995, an EEOC federal sector decision holding that discrimination against a transgender employee based on her gender nonconforming conduct is actionable under Title VII. Defendant points out that this decision represents a change from earlier EEOC decisions when “EEOC emphatically took the opposite position.” [ECF 47, at p. 2:1-2 (listing cases from 1994)] In light of this inconsistency with EEOC’s prior pronouncements, Defendant asserts, Macy should be given little weight. [Id., at p. 3 (citing, e.g., In re Union Pac. R.R. E’ment Practices Litig., 479 F.3d 936, 943 (8th Cir. 2007)]

It is true that in the last five years — which Defendant considers “recent” — the Commission has reevaluated its understanding of Title VII’s protection of transgender individuals. See Macy, 2012 WL 1435995 at *11 n.16. Since issuance of the 1994 decisions cited by Defendant, three Circuits including the Ninth, as well as a number of district courts including Schoer, 577 F.Supp.2d 293, have held that discrimination against transgender individuals based on their gender nonconformity constitutes discrimination on the basis of sex. And while Congress may not have been considering the problems of discrimination faced by transgender individuals, “‘statutory prohibitions often go beyond the principal evil [they were passed to combat] to cover reasonably comparable evils, and it is ultimately the provisions of our laws, rather than the principal concerns of our legislators by which we are governed.’” Macy, 2012 WL 1435995, at *10 (quoting Oncale v. Sundowner Offshore Servs., 523 U.S. 75, 79-80 (1998) (alterations in Macy)). Based on this authority, Macy concluded that Title VII’s prohibition on discrimination “because of ... sex” should logically extend to sex-based discrimination of any kind that meets the statutory requirements, including discrimination against transgender individuals. 2012 WL 1435995 at *10. Thus, the Commission changed its position for the same reason EEOC here urges this Court to reject Defendant’s motion to dismiss — because the developments in the law made the continued carve-out for transgender individuals unsupportable.

But in any event there is no need for this Court to decide how much, if any, deference to accord this federal sector decision. [3] As Defendant concedes, the Commission has not “argue[d] that its present view” — presumably, Macy — “is entitled to deference.” [ECF 47, at p. 3:6] For good reason. Like Macy, EEOC’s position here is based largely on cases such as Schwenk, Smith, and Glenn which, in our view, correctly interpret Title VII. Thus, we believe that the Court should reach the result we advocate not because it is entitled to deference but because it is correct. Based on Schwenk, Smith, Glenn, and the other decisions — including Macy — cited in EEOC’s brief, this Court should find that the allegations in the complaint state a plausible claim for relief under Title VII.

Second, Dignity Health faults the Commission for “omit[ting] mention of recent rulings rejecting its view” as well as “recent developments in transgender discrimination cases.” [ECF 47, at pp. 4:1-8:5] Defendant uses this discussion to expound on decisions that have, at best, marginal relevance. Indeed, Defendant never explains why they matter to the issues actually raised in EEOC’s brief.

Initially, Dignity Health asserts that the Commission should have cited an out-of circuit district court decision, Harris, 2016 WL 4396083. [ECF 47, at pp. 4:2-6:18] In Defendant’s view, it is “telling” that the Commission never mentioned that the Harris court “rejected the theory of transgender status discrimination that the EEOC’s brief asserts is the definitive law of the United States.” [Id., at p. 4: 10-11]

In fact, the decision would have added nothing to the Commission’s discussion of Title VII coverage in this case. As Defendant acknowledges [ECF 47, at p. 5:21-22], Harris was decided on a ground not relevant to Defendant’s motion. 2016 WL 4396083 at *14-16 (Religious Freedom Restoration Act). And no matter how many times Defendant baldly asserts that it does, the Commission’s brief does not advocate for a “theory of transgender status discrimination.” Thus, whatever Harris had to say on that point, the discussion is not relevant here. And, as even Defendant recognizes [ECF 47, at p. 5:6-7], the Harris court accepted the position that EEOC is advocating — that the charging party was in fact covered by Title VII under a Price Waterhouse sex/gender-nonconformity theory. See Harris, 2016 WL 4396083 at *1.

Defendant also argues that the Commission should have mentioned that the Supreme Court agreed to stay the mandate in G.G. ex rel. Grimm v. Gloucester County School Board, 822 F.3d 709 (4th Cir. 2016), so as to allow the defendant school district time to file a petition for certiorari. EEOC cited Grimm in a footnote noting that the Court there found “unpersuasive” Johnston v. University of Pittsburgh, 97 F.Supp.3d 657 (W.D. Pa. 2015), an out-of-circuit case on which Defendant frequently relied. [ECF 43-1, at p. 7 n.3]

The main point of the footnote, however, was that Johnston, which concerns a student and use of sex-segregated bathrooms, does not resemble this case factually, and Defendant made no attempt to reconcile it with Schwenk (204 F.3d at 1201), which rejected the authority on which Johnston relies (97 F.Supp.3d at 671-78 & n.14 (citing Ulane v. E. Airlines, 742 F.2d 1081, 1085 (7th Cir. 1984)). [See ECF43-1, at p. 7 n.3] That is still true. While criticizing EEOC for its “neglect,” Defendant itself neglects to reconcile Johnston and Schwenk — or to explain why such out-of-circuit decisions addressing sex-segregated bathroom use [see also ECF 43-1, at pp. 7-8 & n.10 (citing Texas v. U.S., No. 7:16-cv-00054-O, 2016 WL 4426495 (N.D.Tex. Aug. 21, 2016), Carcano v. McCrory, No. 1:16-cv-00236, 2016 WL 4508192 (M.D.N.C. Aug. 26, 2016)] should undermine EEOC’s argument that Defendant’s motion to dismiss Plaintiff’s facially plausible Title VII complaint should be denied.

II. CONCLUSION

Plaintiff’s complaint adequately alleges that he was denied coverage for medically necessary treatment based on his sex, in violation of Title VII. None of Defendant’s arguments undermine EEOC’s position. This Court should therefore hold that the complaint withstands Defendant’s motion.

Respectfully submitted,

DATED: September 8, 2016

EQUAL EMPLOYMENT OPPORTUNITY

COMMISSION

P. DAVID LOPEZ

General Counsel

JENNIFER S. GOLDSTEIN

Associate General Counsel

BARBARA L. SLOAN

Attorney

Office of General Counsel

131 M Street N.E., 5th Floor

Washington, D.C. 20507

(202) 663-4721

FAX: (202) 663-7090

By: /s/ Peter F. Laura

PETER F. LAURA

Senior Trial Attorney

San Francisco District Office

Phillip Burton Federal Building

450 Golden Gate Ave., Suite 5000

San Francisco, CA 94102

415-522-3077

[1] Dignity Health asserts that in addition to the arguments in its Response, Defendant “incorporates by reference” the arguments in its reply to Robinson’s opposition because “EEOC’s brief largely repeats points already made by Robinson.” [ECF 47, at p. 8 n.12] Neither this Court nor the Commission should be expected to dig through a separate brief and guess which arguments there relate to something in EEOC’s Brief. If it believes it has a response to a point in EEOC’s Brief, Dignity Health must identify that point and make the argument in its Response. See Civ. L.R. 7-4(a)(5).

EEOC also observes that Defendant’s assertion that EEOC’s arguments are the same as Robinson’s contradicts the highly improper — and false — suggestion in Defendant’s Opposition to EEOC’s Motion to File that EEOC’s Brief was “the result of a strategic arrangement” — essentially, collusion — between the EEOC and Robinson to divide up the arguments. [ECF 44, at p. 2:11-18] In fact, as per its custom, the Commission did not share its brief or arguments with either party in advance. Rather, both parties were informed of EEOC’s decision to submit a brief at the same time, on Friday August 19, and until the brief was filed on Monday August 22, neither party knew what it would say.

[2] Defendant asserts that EEOC’s “policy arguments are for Congress, not courts.” [ECF 47, at pp. 10:7-11:12] Other than noting EEOC’s statement that courts interpret Title VII liberally, Defendant points to no policy argument that EEOC has made. The cited paragraph [ECF 43-1, at p. 10:15-23] simply describes the district court decision in Christiansen v. Omnicom Group, No. 1:15-cv-003440 (KPF), 2016 WL 951581 (S.D.N.Y. March 9, 2016).

[3] Macy is not a policy guidance; it is an EEOC decision in a federal sector case. The Commission’s role in the federal sector differs significantly from its role in the more familiar private sector, where EEOC investigates charges, conciliates, and, occasionally, files suit. In the federal sector, the Commission acts as an adjudicator. See 42 U.S.C. §2000e-16(b) (EEOC “shall have the authority to enforce the provisions [of the federal sector provisions]”). Macy resolved a Title VII claim brought by a federal employee (Mia Macy) against the employing federal agency (Department of Justice). It sets out EEOC’s position on transgender coverage and is precedential within the federal sector.

I. ARGUMENT

A. Dignity Health’s Response Distorts EEOC’s Arguments and Addresses Arguments EEOC Did Not Make

1. EEOC Never Argued that this Court Should Find that Robinson is Covered Under a New Title VII Classification Called “Transgender Status”

2. Dignity Health Does Not Respond to EEOC’s Arguments Concerning the Exclusion in the Health Plan for “Sex-Transformation”-Related Treatment

B. Dignity Health’s Other Arguments Do Not Suggest that Dismissal is Appropriate

II. CONCLUSION

1. EEOC Never Argued that this Court Should Find that Robinson is Covered Under a New T itle VII Classification Called “Transgender Status”

2. Dignity Health Does Not Respond to EEOC’s Arguments Concerning
the Exclusion in the Health Plan for “Sex-Transformation”-Related Treatment

B. Dignity Health’s Other Arguments Do Not Suggest that Dismissal
is Appropriate