Title VII of the Civil Rights Act of 1964 prohibits employers from discriminating on the bases of race, color, national origin, religion, and sex. Federal circuits are currently split on whether discrimination based on sexual orientation falls within the scope of discrimination based on sex (and therefore within the scope of Title VII’s prohibition). On February 26, 2018, the en banc Second Circuit Court of Appeals found in Zarda v. Altitude Express that Title VII’s prohibition of discrimination based on sex does in fact cover discrimination based on sexual orientation, overturning its own precedent holding from almost twenty years prior. This result signals increased viability for challenges advocating a broader interpretation of Title VII to remedy sexual orientation discrimination, as well as a potential pushback by the Jeff Sessions-helmed Justice Department as these challenges arise.

Zarda involved a skydiving instructor (Zarda) who alleged that his employer (Altitude Express) fired him in response to a customer telling them of his sexual orientation. The U.S. District Court for the Eastern District of New York granted summary judgment in favor of Altitude Express on Zarda’s claim, finding that Title VII failed to cover sexual orientation discrimination, and that Zarda failed to establish the type of gender-stereotyping claim covered by the act. The District Court considered itself bound by the Second Circuit’s 17-year-old decision in Simonton v. Runyon, and held that, absent an en banc review by the Second Circuit reversing Simonton, Second Circuit precedent required dismissal. Zarda appealed the summary judgment to the Second Circuit, which granted an en banc review. Writing the majority opinion, Judge Robert Katzmann wrote in the majority opinion that sexual orientation discrimination necessarily involves sex discrimination, as it means discrimination against someone based on their own sex in relation to the sex of those to whom they are sexually attracted. Katzmann noted that although Congress had not sought to address sexual orientation discrimination in Title VII, laws like Title VII “often go beyond the principal evil to cover reasonably comparable evils,” which in this case included sexual orientation discrimination. The Second Circuit thus reversed Simonson, vacated the summary judgment, and remanded the Title VII claim to the District Court.

By allowing such a claim to proceed under Title VII, the Second Circuit joined the Seventh Circuit, which found last April that Title VII covers sexual orientation discrimination in its decision in Hively v. Ivy Tech Community College of Indiana. Hively concerned an adjunct professor who alleged that her employer passed her up for full employment because she was openly gay. Hively argued that she faced discriminated for failing to conform to female stereotypes, and because she publicly identified as a lesbian. The Seventh Circuit reversed and remanded the summary judgment in favor of her employer. It found that “discrimination on the basis of sexual orientation is a form of sex discrimination” and that “a person who alleges that she experienced employment discrimination on the basis of her sexual orientation has put forth
Continue Reading Developments in Sexual Orientation Discrimination Claims under Title VII

A California appellate court recently ruled that Tinder’s age-based pricing strategy violated the state’s Unruh Civil Rights Act, which broadly outlaws discrimination based on sex, race, sexual orientation, age, and other classes. California’s Second District Court of Appeal in Los Angeles reversed the trial court’s dismissal of a class action brought by a putative group of customers over 30 years of age, who claim Tinder improperly charged them more for a premium service than it did users in the 18-29 age range.

This case, which has drawn a great deal of publicity, may appear to signal the beginning of a judicial push against age-based price differences, but the implications outside California are likely limited.

In March 2015, the free dating service switched to a “freemium” pricing model. Users could still join Tinder without cost, but for a fee, they could upgrade their membership to Tinder Plus and receive additional features, including the ability to undo mistaken swipes or expand their geographic filter for potential matches. For this membership upgrade, users over 30 paid a $20 subscription fee, while users under 30 paid only $14.99 (or $9.99, depending on any promotions in effect).

Tinder claimed that before setting the price, it conducted market research that showed that users under 30 were more likely to be “budget constrained” and were less likely to pay an increased fee. The named plaintiffs (one of whom previously sued a women-only networking event to allow the inclusion of men) argued that this stated basis failed to justify what amounted to a surcharge on older customers, some of whom might actually have had less disposable cash than younger users.

The court found that, under the Unruh Civil Rights Act, Tinder’s stated basis failed to justify what amounted to age discrimination. The court acknowledged that while this practice might make business sense, it violated the spirit of California’s law, which treats people equally unless the legislature provides an explicit basis to do otherwise (as it has for discounts for elderly persons and minor children). The court found no such legislative basis for young adults generally.

Many other products lend themselves well to different pricing tiers like the one challenged in the Tinder case: software licenses, content subscriptions, club memberships, etc. This scrutiny of Tinder’s pricing suggests that potential plaintiffs may scrutinize any pricing benefitting a non-elderly or minor age group. However, because the age-based claim that will now proceed in California is cutting-edge and largely untested, the full impact of this ruling remains to be seen. In several states (California, Maryland, Pennsylvania, and Wisconsin), courts have found that ladies’ nights violate state discrimination laws, but have not clearly addressed age-based pricing in a similar context.  Regardless, the case law in California and elsewhere will continue to develop. For example, it remains an open question whether student discounts would pass the Appeal Court’s “legislative-findings” standard as applied in the Tinder case.

 
Continue Reading Tinder No Match for CA’s Second District Court of Appeal in Allegedly Ageist Pricing Case