EEOC v. Kronos Inc

Filing 920100907

Opinion

PRECEDENTIAL UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT _____________ No. 09-3219 _____________
E Q U A L EMPLOYMENT OPPORTUNITY COMMISSION, A p p e lla n t v. K R O N O S INCORPORATED O n Appeal from the United States District Court for the Western District of Pennsylvania C a se No. 2:09-mc-00079-AJS District Judge: Honorable Arthur J. Schwab ________________ A rg u e d February 26, 2010 B e f o re : CHAGARES, STAPLETON, and LOURIE * , Circuit Judg es.

(F ile d : September 7, 2010) _________________ C o rb e tt Anderson, Esq. (Argued) E q u a l Employment Opportunity Commission 1 3 1 M Street, N.E. W a sh in g to n , DC 20507

Honorable Alan D. Lourie, United States Circuit Judge for th e Federal Circuit, sitting by designation.

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L is a H. Hernandez, Esq. E q u a l Employment Opportunity Commission 1 0 0 1 Liberty Avenue P itts b u rg h , PA 15219 C o u n s e l for Appellant R o b e rt L. Ashe, Jr., Esq. (Argued) A sh e , Rafuse & Hill 1 3 5 5 Peachtree Street S u ite 500 A tla n ta , GA 30309 T e rra n c e H. Murphy, Esq. B u c h a n an Ingersoll & Rooney 3 0 1 Grant Street O n e Oxford Centre, 20th Floor P itts b u rg h , PA 15219 C o u n s e l for Appellee R a e T. Vann N o rris , Tysse, Lampley & Lakis, LLP 1 5 0 1 M Street, N.W. Ste. 400 W a sh in g to n , DC 2005 a m ic i curiae ________________ O P IN IO N ________________ C H A G A R E S , Circuit Judge. O n March 18, 2009, the Equal Employment Opportunity C o m m is s io n (the "EEOC" or the "Commission") filed a Subpoena E n f o rc e m e n t Application in the United States District Court for the W e ste rn District of Pennsylvania, seeking enforcement of a thirdp a r ty administrative subpoena it issued to Kronos Incorporated (" K ro n o s " ) pertaining to the EEOC's investigation into a charge of d is c rim in a tio n against Kroger Food Stores ("Kroger"). On June 1, 2 0 0 9 , the District Court issued an order narrowing the scope of the 2

su b p o e n a and directing the parties to negotiate a confidentiality o rd e r. On July 22, 2009, the District Court denied the EEOC's m o tio n to adopt its proposed confidentiality order, granted K ro n o s's motion for adoption of its order, and entered Kronos's p ro p o s e d order as the court's own, with slight modifications. The E E O C appeals from both of these orders. For the reasons stated b e lo w , we will affirm in part and reverse in part the District C o u rt's order of June 1, 2009 modifying the scope of the subpoena. W e will vacate the District Court's July 22, 2009 confidentiality o rd e r and remand for further proceedings. I. V ic k y Sandy, who is hearing and speech impaired, filed a c h a rg e of discrimination with the EEOC against Kroger on or about Ju n e 30, 2007. According to her charge, Sandy applied for work a s a cashier, bagger, and stocker in May 2007 at a Kroger in C lark sb u rg , West Virginia. She alleged that Kroger did not hire h e r because of her disability, in violation of the Americans with D isab ilities Act of 1990, 42 U.S.C. § 12101 et seq. ("ADA"). S a n d y alleged that "[i]n May, 2007, a management official (name u n k n o w n ) told me that I would not be a good fit for any openings b e c a u se of the way that I speak. After denying me employment, th e y continued to advertise for openings." Joint Appendix ("JA") 23. Kroger utilizes a Customer Service Assessment, created by K ro n o s (the "Assessment" or "Kronos Assessment"), in its hiring p ro c e ss .1 The Assessment purports to "measure[] the human traits th a t underlie strong service orientation and interpersonal skills, s u c h as: Controlling impatience; Showing respect; Listening

The Assessment consists of fifty statements, to which the a p p lic a n t must answer "strongly disagree," "disagree," "agree," or " stro n g ly agree." It includes statements such as the following: " Y o u have confidence in yourself"; "You are always cheerful"; " Y o u try to sense what others are thinking and feeling"; "You say w h a te v e r is on your mind"; and "It is easy for you to feel what o th e rs are feeling." JA 27. 3

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a tten tiv e ly; Working well on a team; [and] Being sensitive to o th e rs ' feelings." JA 25. According to Kronos, applicants who p e rf o rm well on the assessment are more likely to "[a]ct cheerful, p o lite , and friendly . . . [l]isten carefully . . . and . . . [c]ommunicate w e ll with customers." JA 26. Sandy's score on the Assessment w a s 40%. JA 33. According to Kroger's position statement in response to S an d y's charge, the store manager, Bob Bowers, interviewed Sandy f o r the open positions. Kroger alleged that during the interview, " B o w e rs had difficulty in understanding [Sandy's] verbal responses to questions" and found her responses to be "garbled and at times in a u d ib le and unintelligible." JA 39. Kroger also noted that B o w e rs discussed with Sandy her low score on the Kronos A s s e s s m e n t and her lack of job experience. Kroger provided the EEOC with a copy of Sandy's e m p lo ym e n t application summary. The portion summarizing the re su lts of the Kronos Assessment provides, inter alia, that Sandy " is less likely to . . . listen carefully, understand and remember." JA 33. The summary contains an "Interview Guide" that lists s u g g e ste d follow-up questions. Sandy's follow-up questions in c lu d e , "Describe the hardest time you've had understanding what s o m e o n e was talking about." Sandy's application summary also s u g g e sts observations the interviewer should make, such as "How d o e s the applicant speak during the interview[?] Listen for: C o rre c t lan g u a g e , cle a r e nu nciation , ap p ro p ria te v o lu m e /to n e /e x p re s s io n /s m ile /e ye contact." JA 33. After Kroger admitted in its position statement that it relied a t least in part on the Assessment in its hiring decision, the EEOC s e n t Kroger a request for information ("RFI"), dated January 16, 2 0 0 8 , seeking several categories of documents related to the A s s e ss m e n t and its use. Included was a request for copies of "any a n d all validity studies" and information pertaining to applications f o r the position of "Cashier Bagger" going back to January 1, 2007. J A 42. The RFI asked that Kroger provide the information on or b ef o re February 12, 2008 ­ the date of the EEOC investigator's p lan n e d site-visit.

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K ro g e r responded to the RFI on February 14, 2008, but f a iled to provide all of the information requested, including validity s tu d ie s . The EEOC contends that it was not sure at that point w h e th e r Kroger had access to Kronos's validity studies. JA 103 n .5 . On March 11, 2008, the EEOC issued a third-party a d m in istra tiv e subpoena to Kronos. The subpoena sought validity s tu d ie s related to the Kronos tests Kroger purchased, instruction m a n u a ls for the assessment tests Kroger used, documents related to Kroger, "and any validation efforts made regarding any or all jo b s " at Kroger, any documents related to potential adverse impact o n people with disabilities, and job analyses related to "any and all p o s itio n s " at Kroger. JA 48-49. The EEOC later notified Kroger that it was expanding the sc o p e of its ADA investigation: Based upon its authority, the [EEOC] hereby serves n o tic e that the above referenced charge has been e x p a n d e d to include the issue of disability with r e sp e c t to the use of assessment test in hiring (class) d u rin g the period August 1, 2006 to the present and f o r all facilities in the United States and its te r rito r ie s . J A 54. A c c o rd in g to the EEOC, around this time it discovered an a rtic le , co-written by a Kronos employee, which indicated that m in o rity applicants performed worse than non-minority applicants o n the Kronos Assessment administered by a large, geographically d iv e rs e retailer. Further, the EEOC maintains that its charge d a tab a se contained complaints against Kroger alleging failure to h ire based on disability and race. B as e d on these circumstances, the EEOC sent Kroger a le tte r informing it that the EEOC was expanding its investigation o n c e again, this time to include race:

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B a se d upon its authority, the [EEOC] hereby serves n o tic e that the above referenced charge has been e x p a n d e d to include the basis of disability and race (b la c k ) with respect to the issues of the use of a ss e ss m e n t tests . . . in hiring (class) for the period b eg in n in g from the date that such test(s) were im p le m e n te d by [Kroger] through the present and for a ll facilities in the United States and its territories. JA 56. The EEOC rescinded its original subpoena to Kronos and is s u e d a new subpoena directing that Kronos: 1 . Produce any and all documents and data c o n stitu tin g or related to validation studies or v a lid a tio n evidence pertaining to Unicru [a Kronos s u b s i d i a r y] and/or Kronos assessment tests p u rc h a s e d by The Kroger Company, including but n o t limited to such studies or evidence as they relate to the use of the tests as personnel selection or s c re e n i n g instruments. 2 . Produce the user's manual and instructions for the u s e of the Assessment Tests used by The Kroger C o m p a n y[ . ] 3 . Produce any and all documents and data, including b u t not limited to correspondence, notes, and data f ile s, relating to the Kroger Company; its use of the A s s e ss m e n t Tests; results, ratings, or scores of in d iv id u a l test-takers; and any validation efforts m a d e thereto. 4 . Produce any and all documents discussing, a n a lyz in g or measuring potential adverse impact on in d iv id u a ls with disabilities and/or an individuals [ sic ] race. 5 . Produce any and all documents related to any and a ll job analyses created or drafted by any person or e n tity relating to any and all positions at The Kroger 6

C o m p a n y. 6 . Furnish a catalogue which includes each and every a ss e ss m e n t offered by Unicru/Kronos. Additionally p ro v id e descriptions of each assessment.2 J A 51-52. Kronos filed a Petition to Revoke the Subpoena with the E E O C , objecting that the subpoena "requests information that is: (1 ) not relevant to any allegation made in [Sandy's] Charge, and (2) c o n stitu te s [sic] commercially valuable and trade secret property of K r o n o s , which the EEOC seeks without adequate protection." JA 5 9 . The EEOC denied the Petition to Revoke on January 7, 2009 a n d ordered Kronos to comply with the subpoena. The EEOC d e te rm in e d that the information the subpoena requested was d ire c tly relevant to its properly expanded investigation and "well w ith in the [EEOC]'s investigative authority." JA 108. It further c o n c lu d e d that Title VII of the Civil Rights Act of 1964 ("Title V II" ), the ADA, and the EEOC's regulations regarding c o n f id e n tia lity of information obtained during an investigation p ro v id e d sufficient protection against disclosure without a c o n f id e n tia lity agreement. When Kronos failed to comply with the subpoena, the E E O C filed a Subpoena Enforcement Action, which the District C o u rt granted in part and denied in part. The District Court c h a ra c ter ize d the subpoena's scope as "breathtaking ­ potentially in clu d in g most of Kronos' business documents, covering its entire c lie n t base, with no time, geographic, or job description lim itatio n s." JA 5 (footnotes omitted). The District Court d e te rm in e d that materials unrelated to Sandy's discrimination c h a r g e were not relevant to the investigation. The District Court m o d if ie d the subpoena to include only Kronos's work for Kroger lim ite d to the time period of January 1, 2006 to May 31, 2007, the state of West Virginia, and the job positions of bagger, stocker,

The EEOC no longer seeks enforcement of Paragraph 6 of th e subpoena. EEOC Br. at 16 n.5. 7

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a n d /o r cashier/checker. Specifically, the District Court ordered K r o n o s to comply with the following provisions: 1 . Produce any user's manual and instructions for th e use of the Assessment Tests provided to the K ro g e r Company. 2. Produce any and all documents and data, in c l u d in g but not limited to correspondence, notes, a n d data files, relating to The Kroger Company; The K r o g e r Company's use of the Assessment Tests; re su lts , ratings, or scores of individual test-takers at T h e Kroger Company; and any validation efforts p e rf o rm e d specific[ally] for and only for The Kroger C o m p a n y. 3 . Produce any and all documents discussing, a n a lyz in g or measuring potential adverse impact on in d iv id u a ls with disabilities, relating specifically to a n d only to the Kroger Company. 4 . Produce any and all documents related to any and a ll job analyses created or drafted by Kronos relating to the bagger, stocker, and/or cashier/checker p o s itio n s at The Kroger Company. 5 . Furnish any catalogue provided to The Kroger C o m p a n y. 6 . Items 1 through 5 are limited to the time period of Ja n u a ry 1, 2006 through May 31, 2007, in the state o f West Virginia, for the positions of bagger, s to c k e r, and/or cashier/checker. JA 5-6. The District Court also ordered the parties to enter into "any a p p r o p r i a te confidentiality order to protect any trade s e c re t/c o n f id e n tia l information of Kronos and the personal in f o rm a tio n of persons taking the Assessment Tests." JA 6. The 8

p a rtie s negotiated and agreed to certain provisions of a c o n f id e n tia lity order, but failed to arrive at an agreement regarding o th e r terms Kronos requested, including: 1) a limitation confining th e use of confidential material to the investigation of Sandy's a lle g a tio n s against Kroger and any subsequent charge she may file; 2 ) a restriction that during the investigation, confidential material m ay be disclosed only to EEOC employees with a "need to know" a n d any other person mutually agreed upon by Kronos and the E E O C ; and 3) a requirement that the EEOC return confidential m a te ria l within ten business days after concluding the Sandy in v e stig a tio n , and destroy any documents, including EEOC notes o r memoranda, that reflect or refer to the confidential material w ith in ten business days after a notice of right to sue. Both parties submitted proposed confidentiality orders to the D istrict Court. On July 22, 2009, the court denied the EEOC's m o tio n to adopt its proposed confidentiality order and granted K ro n o s's motion for entry of its proposed confidentiality order. T h e court added an additional term to the Kronos order: "Said c o n f id e n tia l material shall not be entered into a centralized d a ta b a s e ." JA 9. The EEOC appeals both decisions of the District Court. II. T h e District Court exercised jurisdiction under 29 U.S.C. § 1 6 1 (2 ) and 28 U.S.C. §§ 1331 and 1345. This Court has ju ris d ic tio n pursuant to 28 U.S.C. § 1291. We review a district c o u rt's decision to enforce an administrative subpoena for abuse of d iscretio n . Chao v. Cmty. Trust Co., 474 F.3d 75, 79 (3d Cir. 2 0 0 7 ). We also employ an abuse of discretion standard when re v ie w in g the grant of a confidentiality order. Pansy v. Borough of S tro u d s b u rg , 23 F.3d 772, 783 (3d Cir. 1994). "Abuse of d is c re tio n occurs when `the district court's decision rests upon a c le a rly erroneous finding of fact, an errant conclusion of law or an im p ro p e r application of law to fact.'" Chao, 474 F.3d at 79 (q u o tin g NLRB v. Frazier, 966 F.2d 812, 815 (3d Cir. 1992)).

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I I I. A. T h e ADA prohibits, inter alia, use of employment tests that " sc re e n out or tend to screen out an individual with a disability or a class of individuals with disabilities unless the . . . test . . . , as u s e d by the [employer], is shown to be job-related for the position in question and is consistent with business necessity." 42 U.S.C. § 12112(b)(6); see also 42 U.S.C. § 12112(b)(7) (defining " d i s c r im in a t e " to include "failing to select and administer tests co n ce rn in g employment in the most effective manner to ensure th a t, when such test is administered to a job applicant or employee w h o has a disability that impairs sensory, manual, or speaking s k ills , such test results accurately reflect the skills, aptitude, or w h a t e v e r other factor of such applicant or employee that such test p u rp o rts to measure, rather than reflecting the impaired sensory, m an u al, or speaking skills of such employee or applicant . . . ."). "B o th disparate treatment and disparate impact claims are c o g n iz a b le under the ADA." Raytheon Co. v. Hernandez, 540 U.S. 4 4 , 53 (2003). T h e EEOC is empowered to investigate charges of d isc rim in a tio n to determine whether there is reasonable cause to b e lie v e that an employer has engaged in an unlawful employment p ra c tic e .3 See 42 U.S.C. §§ 2000e-5(b), 12117(a) (expanding the E E O C ' s power to investigate and address discrimination on the b a s is of disability). In connection with its investigation, the EEOC m a y issue administrative subpoenas. See id. § 2000e-9; 29 U.S.C. § 161(1). However, the EEOC's statutory investigative authority i s not plenary; the EEOC is entitled to access only evidence

In addition to investigating charges of discrimination filed b y or on behalf of an individual, the EEOC has the authority to file a n d investigate a commissioner's charge alleging unlawful e m p lo ym e n t practices, pursuant to 42 U.S.C. §§ 2000e-5(b) and 2 0 0 0 e -6 (e ). 10

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" re le v a n t to the charge under investigation." 42 U.S.C. §§ 2000e8 (a).4 T h e relevance requirement is not particularly onerous. C o u rts have given broad construction to the term "relevant" and h a v e traditionally allowed the EEOC access to any material that " m ig h t cast light on the allegations against the employer." EEOC v . Shell Oil Co., 466 U.S. 54, 68-69 (1984); see also EEOC v. D i ll o n Cos., Inc., 310 F.3d 1271, 1274 (10th Cir. 2002) ("The S u p r e m e Court has explained that the `relevancy' limitation on the E E O C 's investigative authority is `not especially constraining.'" (q u o tin g Shell Oil, 466 U.S. at 68)); EEOC v. Ford Motor Credit C o ., 26 F.3d 44, 47 (6th Cir. 1994) (noting that "Congress intended [ th e EEOC] to have broad access to information relevant to in q u irie s it is mandated to conduct"); EEOC v. Franklin & M a rs h a ll Coll., 775 F.2d 110, 116 (3d Cir. 1985) ("The concept of relev an cy is construed broadly when a charge is in the investigatory s t a g e ." ) . Nonetheless, the EEOC's power of investigation is a n c h o re d to the charge of discrimination, and courts must be c a r e f u l not to construe the charge and relevance requirements so b ro a d ly as to confer "unconstrained investigative authority" upon th e EEOC. Shell Oil, 466 U.S. at 64-65; see also EEOC v. United A ir Lines, Inc., 287 F.3d 643, 653 (7th Cir. 2002). The relevance re q u ire m e n t "is designed to cabin the EEOC's authority and p re v e n t fishing expeditions." United Air Lines, 287 F.3d at 653 (q u o t a ti o n marks omitted). The EEOC bears the burden of d e m o n s tr a tin g relevance. See EEOC v. S. Farm Bureau Cas. Ins. C o ., 271 F.3d 209, 211 (5th Cir. 2001).

To obtain enforcement of an administrative subpoena, an a g e n c y must demonstrate that 1) its investigation has a legitimate p u r p o s e , 2) the inquiry is relevant to that purpose, 3) the agency d o e s not already possess the information requested, 4) the agency h a s complied with relevant administrative requirements, and 5) the d e m a n d is not "`unreasonably broad or burdensome.'" Univ. of M ed . & Dentistry of N.J. v. Corrigan, 347 F.3d 57, 64 (3d Cir. 2 0 0 3 ) (quoting FDIC v. Wentz, 55 F.3d 905, 908 (3d Cir. 1995)). It is the second requirement, that the inquiry be relevant to a le g itim a te purpose, that is at issue here. 11

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O n c e the EEOC begins an investigation, it is not required to ig n o re facts that support additional claims of discrimination if it u n c o v e rs such evidence during the course of a reasonable in v e s tig a t i o n of the charge. See, e.g., Gen. Tel. Co. of the N.W., In c . v. EEOC, 446 U.S. 318, 331 (1980) ("Any violations that the E E O C ascertains in the course of a reasonable investigation of the c h a rg in g party's complaint are actionable."); EEOC v. Cambridge T i l e Mfg. Co., 590 F.2d 205, 206 (6th Cir. 1979) (per curiam) (e n f o rc in g EEOC subpoena seeking information related to sex d is c rim in a tio n in job classification after EEOC uncovered evidence o f such discrimination during investigation of allegations of sex a n d race discrimination in termination); EEOC v. Gen. Elec. Co., 5 3 2 F.2d 359, 364-65 (4th Cir. 1976) ("[T]he original charge is s u f f ic ie n t to support action by the EEOC . . . for any discrimination sta ted in the charge itself or developed in the course of a reasonable in v e stig a tio n of that charge . . . ."). Rather, the EEOC has the p o w e r to investigate a "a broader picture of discrimination which u n f o ld s in the course of a reasonable investigation of a specific c h a rg e ." Cambridge Tile, 590 F.2d at 206. B. T h e EEOC argues on appeal that, by narrowing the s u b p o e n a 's scope rather than enforcing it as written, the District C o u r t abused its discretion. The EEOC contends that the in f o rm a tio n it sought in the subpoena is relevant because it might c a st light on Sandy's allegations against Kroger, and thus meets the lib e ra l standard of relevance the Supreme Court espoused in Shell O il. In particular, the EEOC argues that the scope of Kroger's use o f the Kronos Assessment ­ "nationwide (not just `the state of W e s t Virginia'), for all retail jobs (not just for `baggers, stockers, a n d /o r cashiers/checkers'), from whatever date Kroger began using th e test to the present (not just from `January 1, 2006 through May 3 1 , 2007'" ­ is relevant as to whether Kroger discriminated against S a n d y individually and/or as a member of a class of individuals w ith disabilities adversely impacted by the Kronos Assessment test. E E O C Br. at 19. The EEOC also asserts that Kronos Assessment in s tru c tio n s and manuals are relevant (regardless of whether K ro n o s actually provided them to Kroger), as are materials related 12

to validation studies and potential adverse impact based on d is a b ility, even if such materials are not specific to Kroger's use of th e test. We agree. The District Court applied too restrictive a sta n d a rd of relevance in limiting the information related to g e o g ra p h y, time, and job position. Further, the District Court erred in limiting the EEOC's access to user's manuals and instructions, v a lid a tio n information, and materials pertaining to potential a d v e r se impact on individuals with disabilities. S a n d y's charge alleges failure to hire based on her disability. K ro g e r admitted to relying at least in part on the Kronos A ss e s s m e n t in evaluating Sandy.5 In order for the EEOC to d e te rm in e whether Kroger's failure to hire Sandy was d isc rim in a to ry, it is entirely appropriate for the EEOC to in v e stig a te Kroger's use of the Assessment. The EEOC is entitled to information that "may provide a useful context" for evaluating e m p l o ym e n t practices under investigation, in particular when such in f o rm a tio n constitutes comparison data. EEOC v. Univ. of P itts b u rg h , 643 F.2d 983, 985-86 (3d Cir. 1981) (holding EEOC re q u e st for faculty employment records of four related schools was re le v a n t to charge of sex discrimination in the School of Nursing, e s p e c ia lly because the School of Nursing faculty was almost e n tir e ly female); see also EEOC v. Associated Dry Goods Corp., 4 4 9 U.S. 590, 604 (1981) ("Statistics and other information about a n employer's general practices may certainly be relevant to in d iv id u a l charges of discrimination . . . ."); Franklin & Marshall C o ll., 775 F.2d at 116-17 (holding materials related to other tenure c a n d id a te s in a "similar time frame" were "relevant and not o v e rb ro a d " in EEOC's investigation of charge alleging d is c rim in a to ry denial of tenure because they might provide useful

According to Kroger, "Bowers also discussed with C h a rg in g Party the low score on the Customer Service Assessment s h e had completed as part of the application process. Bowers noted f r o m the Customer Service Assessment that Charging Party p o te n tia lly might be less inclined to deliver great customer service . . . . Bowers ended the interview by informing Charging Party that h e was concerned about her qualifications, including her low C u s to m e r Service Assessment . . . ." JA 38-39. 13

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co m p ariso n data and help determine whether there was a "pattern o f discrimination"). In this case, information pertaining to K ro g e r's actual use of the Kronos Assessment may provide "useful co n tex t" and important comparative data for the EEOC's in v e s tig a tio n into Sandy's charge of discrimination. The District Court's decision to narrow the subpoena to in c lu d e only bagger, stocker, and/or cashier/checker positions was a n abuse of its discretion. Kroger purportedly uses the Kronos A s s e ss m e n t in hiring for every retail position. JA 104. Under the S h e ll Oil relevance standard, there is no reason to confine the su b p o en a to Kroger's use of the Assessment for bagger, stocker, a n d /o r cashier/checker positions. Information related to other job d e sc rip tio n s may shed light on whether the Assessment has an ad v erse impact on persons with disabilities. Such data, at the very le a st, provides comparative information on the Assessment, which is "absolutely essential to a determination of discrimination." E E O C v. Roadway Express, Inc., 261 F.3d 634, 642 (6th Cir. 2001) (q u o tatio n marks omitted) (holding that the EEOC was entitled to in f o rm a tio n related to job positions other than those at issue in the c h a rg e because such information met the Shell Oil standard of re le v a n c e ). For the same reason, the District Court misapplied the relev an ce standard when it limited the EEOC's access to Kroger's in f o rm a tio n related only to the state of West Virginia. Kroger uses th e Kronos Assessment in hiring nationwide. JA 104. An e m p l o ye r's nationwide use of a practice under investigation s u p p o rts a subpoena for nationwide data on that practice. EEOC v . United Parcel Serv. Inc., 587 F.3d 136, 139 (2d Cir. 2009) (per c u ria m ) (enforcing EEOC subpoena seeking information on how e m p lo ye r applied appearance guidelines nationwide in EEOC in v e stig a tio n of two complaints of religious discrimination). Here, n a tio n w id e materials could provide important comparison data, as w e ll as a "useful context" for evaluating whether Kroger's use of t h e Assessment violates the ADA. See Univ. of Pittsburgh, 643 F .2 d at 985-86. The District Court also too narrowly circumscribed the s u b p o e n a when it instituted the temporal limitation of January 1, 14

2 0 0 6 through May 31, 2007. Although the relevance requirement d o e s impose temporal limits on the scope of the EEOC's inquiry, th e duration of Kroger's use of the Kronos test falls within the s c o p e of information that might cast light on the practice under in v e stig a tio n . Evidence related to the employment practice under in v e stig a tio n prior to and after Sandy's charge provides valuable c o n te x t that may assist the EEOC in determining whether d is c rim in a tio n occurred. Roadway Express, 261 F.3d at 642 (e n f o rc in g EEOC subpoena for information both before the alleged d iscrim in atio n took place and after the charge of discrimination). Kronos argues that the EEOC is not entitled to the in f o rm a tio n it seeks because Sandy's charge is completely devoid o f any allegations of nationwide discrimination and discrimination in job positions other than those for which she applied. Kronos's a rg u m e n t fails to recognize that the EEOC's investigatory power is broader than the four corners of the charge; it encompasses not o n ly the factual allegations contained in the charge, but also any in f o rm a tio n that is relevant to the charge. Thus, the EEOC need n o t cabin its investigation to a literal reading of the allegations in th e charge. As we have acknowledged, "[t]he concept of relevancy is construed broadly when a charge is in the investigatory stage." F r a n k lin & Marshall Coll., 775 F.2d at 116; see also Univ. of P itts b u rg h , 643 F.2d at 986 ("The investigatory powers of the E E O C should be interpreted broadly."). The EEOC does not seek " in f o rm a tio n or materials related to assessment tests Kroger has n e v e r purchased and has never used." EEOC Reply Br. at 12. The re q u e st e d materials are not so broad as to render the relevance re q u ire m e n t a "nullity." See Shell Oil, 466 U.S. at 69 (noting that c o u rts must not interpret the standard of relevance so broadly that it becomes a "nullity"). We decline Kronos's invitation to cabin th e EEOC's investigation such that it is unable to access materials th a t meet the Shell Oil relevance standard ­ that is, materials that m ig h t cast light on Sandy's charge of discrimination. The District Court's decision denying the EEOC access to p a rtic u la r materials unless they relate only to Kroger was an im p ro p e r use of its discretion. The District Court limited p ro d u c tio n of "documents discussing, analyzing, or measuring p o te n t ia l adverse impact on individuals with disabilities" to those 15

" re la tin g specifically to and only to The Kroger Company." JA 6. T h e court also modified the subpoena to limit production of v a lid a tio n study information to validation efforts "performed s p e c if ic [ ally] for and only for Kroger." JA 5-6. Such information, re g a rd le ss of whether it was "performed specifically for" or " re la t[ e s] specifically to and only to" Kroger, certainly might shed lig h t on the charge of discrimination. If Kronos has information re la tin g to whether its Assessment has an adverse impact on d is a b le d people, that information is clearly relevant to whether K ro g e r violated the ADA by using the Assessment. Additionally, in f o rm a tio n pertaining to the validity of the test, even if it was not " p e rf o rm e d specific[ally] for and only for Kroger," could assist the E E O C in evaluating whether Kroger's use of the test constituted an u n la w f u l employment action. Modifying the subpoena to exclude th e se materials was a misapplication of the broad relevance s ta n d a rd that accompanies the EEOC's subpoena authority.

Kronos argues that Sandy alleged disparate treatment in her charge but failed to allege disparate impact, and thus the EEOC is not entitled to investigate whether Kroger's use of the Assessment has an adverse impact on people with disabilities. We disagree. Sandy's charge does not contain a legal theory, nor was she required to assert one. See 29 C.F.R. § 1601.12(a)-(b) (requiring, inter alia, a "clear and concise statement of the facts" related to the alleged unlawful employment practices and noting that a charge that "describe[s] generally the action complained of" is sufficient). We have recognized that the individuals who draft charges are often "not well vested in the art of legal description" and as a result, "the scope of the original charge should be liberally construed." Hicks v. ABT Assocs., Inc., 572 F.2d 960, 965 (3d Cir. 1978); see also Sanchez v. Standard Brands, Inc., 431 F.2d 455, 462-63 & n.4 (5th Cir. 1970) (noting that a layperson filling out a charge of discrimination might have difficulty articulating legal basis for alleged discrimination); EEOC v. E.I. DuPont de Nemours & Co., 373 F. Supp. 1321, 1335 (D. Del. 1974) (explaining that the "precise language of the charge . . . provides less guidance for subsequent proceedings than the general character of the grievances to which the charge alludes" and that the charge is often drawn by a layperson who "perceives only dimly the nature and cause of the discrimination"), aff'd on other
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grounds, 516 F.2d 1297 (3d Cir. 1975). It is entirely possible that Sandy was not fully aware of the extent to which Kroger relied on the test in evaluating her application, and thus did not perceive the potential impact the test had on Kroger's decision not to hire her. In any event, it is up to the EEOC, not Sandy, to investigate whether and under what legal theories discrimination might have occurred. Finally, the District Court abused its discretion in limiting Kronos's production of the user's manual and instructions for the Assessment to those materials only actually provided to Kroger. We agree with the EEOC that regardless of whether Kronos actually provided Kroger with user's manuals and instructions, the materials may aid the EEOC in understanding the Assessment's potential for disparate impact on the disabled. For the foregoing reasons, we will reverse the District Court's judgment insofar as it limited the scope of the EEOC's subpoena in terms of geography, time, and job description. We will also reverse to the extent that the District Court's order limits the EEOC's access to validation efforts conducted solely on behalf of Kroger, documents relating to potential adverse impact on disabled individuals to those relating specifically and only to Kroger, and user's manuals and instructions for the Assessment that were actually provided to Kroger. C. We now turn to the EEOC's request for "documents discussing, analyzing or measuring potential adverse impact . . . [on the basis of] race." JA 52. The EEOC argues that it is entitled to this information as part of a properly expanded investigation of Sandy's charge and that the District Court abused its discretion in modifying its subpoena to exclude such materials. We disagree.6

We understand the EEOC's argument in support of its re q u e st for information related to potential adverse impact based on ra c e to be premised on a reasonable expansion of its investigation o f the Sandy charge. However, to the extent that the EEOC asserts 17

6

According to the EEOC, it expanded the investigation to include potential race discrimination because it discovered a scholarly article, co-written by a Kronos employee, suggesting that minority applicants performed worse than non-minorities on the Kronos Assessment. The EEOC also contends that it discovered in its database charges against Kroger alleging race discrimination in hiring. According to the EEOC, this constitutes evidence that the Assessment might be a potential "root source of discrimination" against people with disabilities and African Americans, and is thus a legitimate basis for it to expand its investigation into discrimination based on race. See Gen. Elec. Co., 532 F.2d at 366 n.9 ("`The Commission need not confine itself to the particular symptom of discrimination identified by a charge if a reasonable investigation of that charge uncovers a root source of discrimination responsible for that and other violations of Title VII.'" (quoting DuPont de Nemours & Co., 373 F. Supp. at 1335)). For support, the EEOC cites to General Electric Co., 532 F.2d at 364-66, in which the Court of Appeals for the Fourth Circuit held that the original charge of race discrimination supported EEOC action (including a lawsuit) to address sex discrimination that the EEOC uncovered while investigating the race discrimination charge. Kronos responds that the District Court did not abuse its discretion in limiting the subpoena to exclude information related to adverse impact based on race. Kronos cites to EEOC v. Southern Farm Bureau Casualty Insurance Co., 271 F.3d 209 (5th Cir. 2001), in support of its argument. In Southern Farm, an employee filed a charge with the EEOC alleging that Southern Farm had discriminated against him based on race. During the EEOC's investigation, Southern Farm provided the EEOC with a list of employees by name, position, and race. Based on this list,

that the information related to race is relevant to Sandy's charge u n d er the Shell Oil standard, we decline to hold that the EEOC's re q u e s t for materials concerning whether the Kronos Assessment h a s an adverse racial impact is relevant to, or might shed light on, S a n d y's charge that Kroger discriminated against her based on d is a b ility. 18

the EEOC suspected potential sex discrimination, and issued a subpoena requesting certain information related to possible unlawful employment practices based on sex. Id. at 211. The Court of Appeals for the Fifth Circuit affirmed the district court's refusal to enforce the EEOC subpoena for information relating to potential sex discrimination. In affirming the district court's decision, the Southern Farm court noted that when the EEOC discovered what it considered to be evidence of sex discrimination, it could have exercised its authority under 42 U.S.C. §§ 2000e-5(b) and 2000e-6(e) to file a commissioner's charge alleging sex discrimination. At that point, the EEOC would have been free to request information relevant to Southern Farm's employment of women. Id. While the EEOC is not required to ignore facts it uncovers in the course of a reasonable investigation of the charging party's complaint, that standard does not justify the expansion of the investigation undertaken here. The charging party is a disabled white female who has complained of disability discrimination. We are unprepared to hold that a reasonable investigation of that charge can be extended to include an investigation of race discrimination. We conclude that the inquiry into potential race discrimination is not a reasonable expansion of Sandy's charge. Instead, the EEOC's subpoena for materials related to race constitutes an impermissible "fishing expedition." See United Air Lines, 287 F.3d at 653. The EEOC's attempt to rely on an article in the public domain and purported charges of race discrimination in its database that are not a part of this record do not convince us otherwise. We acknowledge that the EEOC's investigatory powers are expansive; however, the EEOC is still not permitted to "wander[] into wholly unrelated areas." See Cambridge Tile, 590 F.2d at 206. In this case, the EEOC's inquiry into discrimination based on race is wholly unrelated to Sandy's charge and does not

19

fall within the ambit of a reasonable expansion.7 For these reasons, we will affirm the District Court's judgment to the extent that it declines to enforce the portion of the EEOC's subpoena requesting information related to potential discrimination based on race. IV. Courts have "inherent equitable power" to grant orders of confidentiality upon a showing of good cause. Pansy, 23 F.3d at 785-86. The party seeking confidentiality establishes good cause by showing that "`disclosure will work a clearly defined and serious injury to the party seeking closure. The injury must be shown with specificity.'" Id. at 786 (quoting Publicker Indus., Inc. v. Cohen, 733 F.2d 1059, 1071 (3d Cir. 1984)). "`Broad allegations of harm, unsubstantiated by specific examples or articulated reasoning,' do not support a good cause showing." Id. (quoting Cipollone v. Liggett Group, Inc., 785 F.2d 1108, 1121 (3d Cir. 1986)). The burden of justifying confidentiality remains at all times on the party seeking the order. Pearson v. Miller, 211 F.3d 57, 72 (3d Cir. 2000). In Pansy, we held that courts deciding whether a party has established good cause should balance public interests against private interests. Pansy, 23 F.3d at 787. We recognized several factors that courts may consider as part of this "good cause balancing test": 1) whether disclosure will violate any privacy interests; 2) whether the information is being sought for a

Because we conclude that the EEOC has not reasonably e x p a n d e d its investigation to include race, we decline to address K ro n o s's argument that the EEOC lacks the authority to expand its d is c rim in a tio n investigation based on one anti-discrimination s ta tu te (the ADA) to include charges arising under a different s ta tu te (Title VII). 20

7

legitimate purpose or an improper purpose; 3) whether disclosure of the information will cause a party embarrassment; 4) whether confidentiality is being sought over information important to public health and safety; 5) whether the sharing of information among litigants will promote fairness and efficiency; 6) whether a party benefitting from the order of confidentiality is a public entity or official; and 7) whether the case involves issues important to the public. Glenmade Trust Co. v. Thompson, 56 F.3d 476, 483 (3d Cir. 1995) (citing Pansy, 23 F.3d at 787-91). Under the good cause balancing test, there is a strong presumption against entering an order of confidentiality whose scope would prevent disclosure of information that would otherwise be accessible under a relevant freedom of information law. Pansy, 23 F.3d at 791. When a district court fails to conduct a good cause balancing test before issuing an order of confidentiality, that court has failed to exercise properly its discretion. Id. at 792. In this case, the District Court entered a wide-reaching confidentiality order which defines "Confidential Material" as: any documents or information in any form produced by Kronos pursuant to [the subpoena] or any information or documents that refer to or reflect information obtained from the documents or refer to or reflect information provided by Kronos pursuant to the Subpoena, including copies, notes or memoranda made by the EEOC during the Commission's investigation into the allegations made by Vicky Sandy and any subsequent or amended charge she may file.

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JA 8. The order limits the use of Confidential Material solely for the purpose of Sandy's charge. It permits disclosure only to EEOC employees with a "need to know" and other individuals Kronos and the EEOC agree upon in writing. The District Court prohibited the EEOC from entering Confidential Material into a centralized database. The order prohibits the EEOC from disclosing the documents Kronos produces, and the information contained therein, to the charging party or her agents. The order also provides that: All Confidential Material, including copies thereof, will be returned by EEOC to Kronos within ten (10) business days after the investigation into [Sandy's charge] is concluded by EEOC. Any information or documents that reflect or refer to Confidential Material, including any notes or memoranda made by EEOC shall be destroyed by EEOC within ten (10) business days after a notice of right to sue is issued by EEOC, and such destruction shall be so certified to Kronos. JA 9. The EEOC appeals entry of the confidentiality order.8 The EEOC argues that sufficient statutory and regulatory protection exists to safeguard confidential material without the confidentiality order and that the order's definition of Confidential Material is overbroad. In addition, the EEOC urges that the order is contrary to the EEOC's disclosure obligations under the Freedom of Information Act, 5 U.S.C. §§ 551-559, and its limitations on the

We note that the EEOC does not challenge the portion of th e order prohibiting it from disclosing subpoenaed material to S a n d y or her agents during the investigation. EEOC Br. at 41 n.11. F u r th e r, the EEOC has represented that it "would honor the portion o f the confidentiality order stating that the EEOC would disclose m a te ria ls covered by the subpoena to individuals outside the C o m m is s io n (including but not limited to expert witnesses) when m u tu a lly agreed upon in writing." Id. 22

8

EEOC's use of the subpoenaed material impermissibly interferes with the EEOC's law enforcement function. The District Court did not articulate its reasoning for granting the order and its rationale for exercising its broad discretion to fashion the order by imposing the specific terms it chose to include. See Pansy, 23 F.3d at 791 ("Courts have discretion to fashion such orders according to the needs and circumstances of each case."). Without any indication that the District Court conducted the required good cause balancing test before entering this order, we must conclude that the entry of the order does not reflect the proper exercise of discretion. See id. at 792; cf. EEOC v. Nat'l Children's Ctr., Inc., 98 F.3d 1406, 1410 (D.C. Cir. 1996) (remanding when the district court's failure to articulate its reasoning for sealing portions of the record rendered the court's decision unreviewable). Accordingly, we will vacate the order and remand to the District Court to conduct a good cause balancing test. On remand, the District Court should be mindful of the statutory scheme governing disposal of government records. The Federal Records Disposal Act ("FRDA") prohibits destruction of government records except according to its requirements. 44 U.S.C. § 3314 ("[R]ecords of the United States Government may not be alienated or destroyed except under this chapter."). The FRDA defines "records" as "documentary materials . . . made or received by an agency of the United States Government under Federal law or in connection with the transaction of public business and preserved or appropriate for preservation . . . as evidence of the organization, function, policies, decisions, procedures, operations, or other activities of the Government." 44 U.S.C. § 3301. Courts must exercise caution when issuing confidentiality orders so as not to demand that the EEOC destroy government documents, including notes and memoranda, in conflict with the EEOC's duty to obey the requirements of the F RD A . Based on the aforementioned reasons, we will vacate the District Court's confidentiality order and remand to permit the District Court to conduct a good cause balancing test.
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V. For the reasons stated above, we will reverse in part and affirm in part the District Court's judgment of June 1, 2009 narrowing the scope of the subpoena. We will vacate and remand the District Court's July 22, 2009 confidentiality order.

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