Using Artificial Intelligence and Algorithms

 

Using Artificial Intelligence and Algorithms

 

By: Andrew Smith, Director, FTC Bureau of Consumer Protection

April 8, 2020

Republication

 

AI, Algorithms, Consumer, Privacy, Data, Bogus “Likes”, Chatbot, Facial Recognition, Voice-cloning Technologies, Title VII, Disparate Impact

 

How companies can manage the consumer protection risks of AI and algorithms.

 

 

 

BE TRANSPARENT.

 

Don’t deceive consumers about how you use automated tools. Oftentimes, AI operates in the background, somewhat removed from the consumer experience. But, when using AI tools to interact with customers (think chatbots), be careful not to mislead consumers about the nature of the interaction. The Ashley Madison complaint alleged that the adultery-oriented dating website deceived consumers by using fake “engager profiles” of attractive mates to induce potential customers to sign up for the dating service. And the Devumi complaint alleged that the company sold fake followers, phony subscribers, and bogus “likes” to companies and individuals that wanted to boost their social media presence. The upshot? If a company’s use of doppelgängers – whether a fake dating profile, phony follower, deepfakes, or an AI chatbot – misleads consumers, that company could face an FTC enforcement action.

 

Be transparent when collecting sensitive data. The bigger the data set, the better the algorithm, and the better the product for consumers, end of story…right? Not so fast. Be careful about how you get that data set. Secretly collecting audio or visual data – or any sensitive data – to feed an algorithm could also give rise to an FTC action. Just last year, the FTC alleged that Facebook misled consumers when it told them they could opt in to facial recognition – even though the setting was on by default. As the Facebook case shows, how you get the data may matter a great deal.

 

If you make automated decisions based on information from a third-party vendor, you may be required to provide the consumer with an “adverse action” notice. Under the FCRA, a vendor that assembles consumer information to automate decision-making about eligibility for credit, employment, insurance, housing, or similar benefits and transactions, may be a “consumer reporting agency.” That triggers duties for you, as the user of that information. Specifically, you must provide consumers with certain notices under the FCRA. Say you purchase a report or score from a background check company that uses AI tools to generate a score predicting whether a consumer will be a good tenant. The AI model uses a broad range of inputs about consumers, including public record information, criminal records, credit history, and maybe even data about social media usage, shopping history, or publicly-available photos and videos. If you use the report or score as a basis to deny someone an apartment, or charge them higher rent, you must provide that consumer with an adverse action notice. The adverse action notice tells the consumer about their right to see the information reported about them and to correct inaccurate information.

 

EXPLAIN YOUR DECISION TO THE CONSUMER.

 

If you deny consumers something of value based on algorithmic decision-making, explain why. Some might say that it’s too difficult to explain the multitude of factors that might affect algorithmic decision-making. But, in the credit-granting world, companies are required to disclose to the consumer the principal reasons why they were denied credit, and it’s not good enough simply to say “your score was too low” or “you don’t meet our criteria.” You need to be specific (e.g., “you’ve been delinquent on your credit obligations” or “you have an insufficient number of credit references”). This means that you must know what data is used in your model and how that data is used to arrive at a decision. And you must be able to explain that to the consumer. If you are using AI to make decisions about consumers in any context, consider how you would explain your decision to your customer if asked.

 

If you use algorithms to assign risk scores to consumers, also disclose the key factors that affected the score, rank ordered for importance. Similar to other algorithmic decision-making, scores are based on myriad factors, some of which may be difficult to explain to consumers. For example, if a credit score is used to deny someone credit, or offer them less favorable terms, the law requires that consumers be given notice, a description of the score (its source, the range of scores under that credit model), and at least four key factors that adversely affected the credit score, listed in the order of their importance based on their effect on the credit score.

 

If you might change the terms of a deal based on automated tools, make sure to tell consumers. More than a decade ago, the FTC alleged that subprime credit marketer CompuCredit violated the FTC Act by deceptively failing to disclose that it used a behavioral scoring model to reduce consumers’ credit limits. For example, if cardholders used their credit cards for cash advances or to make payments at certain venues, such as bars, nightclubs, and massage parlors, they might have their credit limit reduced. The company never told consumers that these purchases could reduce their credit limit – neither at the time they signed up nor at the time they reduced the credit limit. That decade-old matter is just as important today. If you’re going to use an algorithm to change the terms of the deal, tell consumers.

 

ENSURE THAT YOUR DECISIONS ARE FAIR.

 

Don’t discriminate based on protected classes. Cavalier use of AI could result in discrimination against a protected class. A number of federal equal opportunity laws, such as ECOA and Title VII of the Civil Rights Act of 1964, may be relevant to such conduct. The FTC enforces ECOA, which prohibits credit discrimination on the basis of race, color, religion, national origin, sex, marital status, age, or because a person receives public assistance. If, for example, a company made credit decisions based on consumers’ Zip Codes, resulting in a “disparate impact” on particular ethnic groups, the FTC could challenge that practice under ECOA. You can save yourself a lot of problems by rigorously testing your algorithm, both before you use it and periodically afterwards, to make sure it doesn’t create a disparate impact on a protected class.

 

Give consumers access and an opportunity to correct information used to make decisions about them. The FCRA regulates data used to make decisions about consumers – such as whether they get a job, get credit, get insurance, or can rent an apartment. Under the FCRA, consumers are entitled to obtain the information on file about them and dispute that information if they believe it to be inaccurate. Moreover, adverse action notices are required to be given to consumers when that information is used to make a decision adverse to the consumer’s interests. That notice must include the source of the information that was used to make the decision and must notify consumers of their access and dispute rights. If you are using data obtained from others – or even obtained directly from the consumer – to make important decisions about the consumer, you should consider providing a copy of that information to the consumer and allowing the consumer to dispute the accuracy of that information.

 

ENSURE THAT YOUR DATA AND MODELS ARE ROBUST AND EMPIRICALLY SOUND.

 

If you provide data about consumers to others to make decisions about consumer access to credit, employment, insurance, housing, government benefits, check-cashing or similar transactions, you may be a consumer reporting agency that must comply with the FCRA, including ensuring that the data is accurate and up to date. You may be thinking: We do AI, not consumer reports, so the FCRA doesn’t apply to us. Well, think again. If you compile and sell consumer information that is used or expected to be used for credit, employment, insurance, housing, or other similar decisions about consumers’ eligibility for certain benefits and transactions, you may indeed be subject to the FCRA. What does that mean? Among other things, you have an obligation to implement reasonable procedures to ensure maximum possible accuracy of consumer reports and provide consumers with access to their own information, along with the ability to correct any errors. RealPage, Inc., a company that deployed software tools to match housing applicants to criminal records in real time or near real time, learned this the hard way. The company ended up paying a $3 million penalty for violating the FCRA by failing to take reasonable steps to ensure the accuracy of the information they provided to landlords and property managers.

 

If you provide data about your customers to others for use in automated decision-making, you may have obligations to ensure that the data is accurate, even if you are not a consumer reporting agency. Companies that provide data about their customers to consumer reporting agencies are referred to as “furnishers” under the FCRA. They may not furnish data that they have reasonable cause to believe may not be accurate. In addition, they must have in place written policies and procedures to ensure that the data they furnish is accurate and has integrity. Furnishers also must investigate disputes from consumers, as well as disputes received from the consumer reporting agency. These requirements are important to ensure that the information used in AI models is as accurate and up to date as it can possibly be. And, the FTC has brought actions, and obtained big fines, against companies that furnished information to consumer reporting agencies but that failed to maintain the required written policies and procedures to ensure that the information that they report is accurate.

 

Make sure that your AI models are validated and revalidated to ensure that they work as intended, and do not illegally discriminate. Again, more lessons from the world of consumer lending, where credit-grantors have been using data and algorithms for decades to automate the credit underwriting process. The lending laws encourage the use of AI tools that are “empirically derived, demonstrably and statistically sound.” This means, among other things, that they are based on data derived from an empirical comparison of sample groups, or the population of creditworthy and noncreditworthy applicants who applied for credit within a reasonable preceding period of time; that they are developed and validated using accepted statistical principles and methodology; and that they are periodically revalidated by the use of appropriate statistical principles and methodology, and adjusted as necessary to maintain predictive ability.

 

HOLD YOURSELF ACCOUNTABLE FOR COMPLIANCE, ETHICS, FAIRNESS, AND NONDISCRIMINATION.

 

Ask questions before you use the algorithm. Going back to the 2016 Big Data report, the Commission warned companies that big data analytics could result in bias or other harm to consumers. To avoid that outcome, any operator of an algorithm should ask four key questions:

• How representative is your data set?
• Does your data model account for biases?
• How accurate are your predictions based on big data?
• Does your reliance on big data raise ethical or fairness concerns?

 

Protect your algorithm from unauthorized use. If you’re in the business of developing AI to sell to other businesses, think about how these tools could be abused and whether access controls and other technologies can prevent the abuse. For instance, just last month, the FTC hosted a workshop on voice-cloning technologies. Thanks to machine learning, these technologies enable companies to use a five-second clip of a person’s actual voice to generate a realistic audio of the voice saying anything. This technology promises to help people who have lost the ability to speak, among other things, but could be easily abused if it falls into the hands of people engaged in imposter schemes. One company that is introducing this cloning technology is vetting users and running the technology on its own servers so that it can stop any abuse that it learns about.

 

Consider your accountability mechanism. Consider how you hold yourself accountable, and whether it would make sense to use independent standards or independent expertise to step back and take stock of your AI. For example, going back to the algorithm that ended up discriminating against black patients, well-intentioned employees were trying to use the algorithm to target medical interventions to the sickest patients. Outside, objective observers who independently tested the algorithm were the ones who discovered the problem. Such outside tools and services are increasingly available as AI is used more frequently, and companies may want to consider using them.

 

Williams v. Chino Valley Independent Fire Dist., S213100

Attorney fees and costs: plaintiff Loring Winn Williams sued defendant Chino Valley Independent Fire District (the District) for employment discrimination in violation of the California Fair Employment and Housing Act.  (FEHA; Gov. Code, § 12900 et seq.)  The trial court granted summary judgment for the District and, in a separate order, awarded the District its court costs.  Williams appealed from the latter order, contending that in the absence of a finding his action was frivolous, unreasonable or groundless, defendant should not have been awarded its costs.

The issues presented are these:  Is a defendant prevailing in a FEHA action entitled to its ordinary court costs as a matter of right pursuant to Code of Civil Procedure section 1032, or only in the discretion of the trial court pursuant to Government Code section 12965, a provision of FEHA itself?  And, if the trial court does have discretion, must that discretion be exercised according to the rule applicable to attorney fee awards in certain federal civil rights actions under Christiansburg Garment Co. v. EEOC (1978) 434 U.S. 412 (Christiansburg), according to which a prevailing defendant receives its attorney fees only if the plaintiff’s action was objectively groundless?

We conclude Government Code section 12965, subdivision (b), governs cost awards in FEHA actions, allowing trial courts discretion in awards of both attorney fees and costs to prevailing FEHA parties.  We further conclude that in awarding attorney fees and costs, the trial court’s discretion is bounded by the rule of Christiansburg; an unsuccessful FEHA plaintiff should not be ordered to pay the defendant’s fees or costs unless the plaintiff brought or continued litigating the action without an objective basis for believing it had potential merit.

Code of Civil Procedure section 1032, subdivision (b) (Code of Civil Procedure section 1032(b)), guarantees prevailing parties in civil litigation awards of the costs expended in the litigation:  “Except as otherwise expressly provided by statute, a prevailing party is entitled as a matter of right to recover costs in any action or proceeding.” 

Code of Civil Procedure section 1033.5 limits recoverable costs to those both “reasonably necessary to the conduct of the litigation” and “reasonable in amount.”  (Id., subd. (c)(2), (3).)  The section also details the types of expenses “allowable as costs under Section 1032.”  (Id., subd. (a).)  These include filing, motion, and jury fees, food and lodging costs for sequestered juries, the costs of taking necessary depositions, costs of service of process, fees of ordinary witnesses and of court ordered experts, the costs of transcripts ordered by the court, attachment expenses and surety bond premiums, fees of court reporters and interpreters, and the costs of exhibits helpful to the trier of fact.  (Id., subd. (a)(1)-(9), (11)-(13).)  Attorney fees and parties’ expert witness fees are not ordinarily recoverable as costs under section 1032.  (Id., subds. (a)(10), (b)(1).)

Government Code section 12965, subdivision (b) (Government Code section 12965(b)), provides for private actions to enforce the provisions of FEHA.  It states in part:  “In civil actions brought under this section, the court, in its discretion, may award to the prevailing party, including the department, reasonable attorney’s fees and costs, including expert witness fees.” 

In an action under title VII of the 1964 Civil Rights Act (Title VII), the trial court, “in its discretion, may allow the prevailing party . . . a reasonable attorney’s fee . . . as part of the costs.”  (42 U.S.C. § 2000e-5(k).)  In Christiansburg, the high court interpreted this discretionary provision as creating a different standard for awards of fees to prevailing defendants than to prevailing plaintiffs:  while prevailing Title VII plaintiffs, whom Congress had chosen as an instrument to vindicate its policy against job discrimination, should ordinarily be awarded their fees (Christiansburg, supra, 434 U.S. at pp. 416–417, 418), a Title VII plaintiff “should not be assessed his opponent’s attorney’s fees unless a court finds that his claim was frivolous, unreasonable, or groundless, or that the plaintiff continued to litigate after it clearly became so.”  (Christiansburg, at p. 422.)  The legislative history of Title VII indicated the purpose of the fee provision was to “ ‘make it easier for a plaintiff of limited means to bring a meritorious suit.’ ”  (Christiansburg, at p. 420.)  To award fees to a defendant simply because the plaintiff was ultimately unsuccessful “would substantially add to the risks inhering in most litigation and would undercut the efforts of Congress to promote the vigorous enforcement of the provisions of Title VII.”  (Id. at p. 422.). Christiansburg involved attorney fees, not court costs, and the high court has not decided whether the same asymmetrical standard applies to an award of costs to a prevailing Title VII defendant. 

As noted earlier, Code of Civil Procedure section 1032(b) provides that civil defendants are “entitled as a matter of right” to recover their costs “except as otherwise expressly provided by statute.”  Unless Government Code section 12965(b) expressly excepts FEHA parties from this entitlement, therefore, a prevailing FEHA defendant is entitled to its costs as a matter of right.

We conclude Government Code section 12965(b) is an express exception to Code of Civil Procedure section 1032(b) and the former, rather than the latter, therefore governs costs awards in FEHA cases.  The FEHA statute expressly directs the use of a different standard than the general costs statute:  costs that would be awarded as a matter of right to the prevailing party under Code of Civil Procedure section 1032(b) are instead awarded in the discretion of the trial court under Government Code section 12965(b).  By making a cost award discretionary rather than mandatory, Government Code section 12965(b) expressly excepts FEHA actions from Code of Civil Procedure section 1032(b)’s mandate for a cost award to the prevailing party.

“In interpreting California’s FEHA, California courts often look for guidance to decisions construing federal antidiscrimination laws, including title VII of the federal Civil Rights Act of 1964 . . . .  But federal court interpretations of Title VII are helpful in construing the FEHA only when the relevant language of the two laws is similar.”  (Chavez, supra, 47 Cal.4th at p. 984.)  The relevant Title VII section (42 U.S.C. § 2000e-5(k) [providing that the trial court, “in its discretion, may allow the prevailing party . . . a reasonable attorney’s fee . . . as part of the costs . . . .”]) is similar to Government Code section 12965(b) as to attorney fees, but not as to ordinary court costs.  By making fees discretionary as part of the costs, but not making costs themselves discretionary, the Title VII phrasing “makes an attorney fee award discretionary” but “does not suggest that ‘the costs’ are similarly discretionary, but rather that they are a given, to which fees may attach.”  (Martin v. California Dept. of Veterans Affairs, supra, 560 F.3d at p. 1053.)  In contrast, both the ADA and FEHA expressly extend the court’s discretion to fees and costs, not merely fees as part of the costs.  As the relevant language of Government Code section 12965(b) follows the ADA more closely than it does Title VII, federal decisions on the former are more persuasive than those on the latter in resolving the issue at hand.

On its face, the language of Government Code section 12965(b) does not distinguish between awards to FEHA plaintiffs and to FEHA defendants:  it simply provides trial court discretion in making fee and cost awards to the prevailing “party.”  But the legislative history of the bill by which this language entered our law, and the underlying policy distinctions reflected in that history, persuade us the Legislature intended trial courts to use the asymmetrical standard of Christiansburg as to both fees and costs. FEHA, enacted in 1980, combined the provisions of two predecessor statutes, the Fair Employment Practices Act (Lab. Code, former § 1410 et seq.) and the Rumford Fair Housing Act (Health & Saf. Code, former § 35700 et seq.).  (Rojo v. Kliger (1990) 52 Cal.3d 65, 72.)  Labor Code former section 1422.2, subdivision (b), authorizing civil actions alleging discrimination in employment, was the direct predecessor of Government Code section 12965(b).  As amended in 1978, it provided that in such an action “the court, in its discretion, may award to the prevailing party reasonable attorney fees and costs . . . .”  (Stats. 1978, ch. 1254, § 10, p. 4074.)  This provision was later recodified in Government Code section 12965(b) without relevant alteration.

In the end, the language and history of Government Code section 12965(b) persuade us the Legislature intended a trial court’s discretion to be exercised in the same manner for costs as for attorney fees.  The statute treats the two in parallel and without distinction, providing discretion in the award of “attorney’s fees and costs” to a prevailing FEHA party.  (Gov. Code, § 12965(b).) 

The history of the statutory amendment adding this language to Government Code section 12965(b)’s predecessor shows the Legislature was aware of and embraced the asymmetrical rule applied in Title VII cases.  Although Title VII discretion was later found to apply only to attorney fees, our Legislature used language providing discretion as to costs as well, and similar language in the federal ADA has since been construed as calling for use of Christiansburg’s asymmetrical standard for both costs and fees.  And while ordinary costs are generally likely to be smaller than attorney fees, a broader application of Christiansburg is nonetheless consistent with the legislative policy.  In FEHA cases, even ordinary litigation costs can be substantial, and the possibility of their assessment could significantly chill the vindication of employees’ civil rights.  Statutory language and legislative history thus point in the same direction.

For these reasons, we conclude the Christiansburg standard applies to discretionary awards of both attorney fees and costs to prevailing FEHA parties under Government Code section 12965(b).  To reiterate, under that standard a prevailing plaintiff should ordinarily receive his or her costs and attorney fees unless special circumstances would render such an award unjust.  (Christiansburg, supra, 434 U.S. at pp. 416–417.)  A prevailing defendant, however, should not be awarded fees and costs unless the court finds the action was objectively without foundation when brought, or the plaintiff continued to litigate after it clearly became so.  (Id. at pp. 421–422.)  We disapprove Perez v. County of Santa Clara (2003) 111 Cal.App.4th 671, Knight v. Hayward Unified School Dist. (2005) 132 Cal.App.4th 121, and Hatai v. Department of Transportation (2013) 214 Cal.App.4th 1287 to the extent they held ordinary costs were not governed by this standard.

The Court of Appeal erred in affirming the trial court’s award of costs to defendant despite the absence of any finding the action was objectively groundless.  The judgment of the Court of Appeal is reversed and the matter is remanded to that court for further proceedings consistent with this opinion.

Books: Blasi and Doherty, Cal. Employment Discrimination Law and Its Enforcement:  The Fair Employment and Housing Act at 50 (UCLA/Rand Center for Law & Public Policy 2010); Chin, Wiseman et al., Cal. Practice Guide:  Employment Litigation (The Rutter Group 2014).

(Cal. S. Ct., May 4, 2015, Williams v. Chino Valley Independent Fire Dist., S213100).

La demanderesse W. actionna le défendeur V. pour discrimination sur la place de travail en violation de la loi californienne sur des conditions de travail et d’habitation équitables (FEHA). La cour de première instance jugea sommairement en faveur du District défendeur et, dans une ordonnance séparée, condamna la demanderesse à payer les frais de justice du défendeur. La demanderesse recourut contre cette dernière ordonnance, alléguant qu’elle n’avait pas établi que l’action aurait été frivole, déraisonnable ou sans fondement, de sorte qu’aucune condamnation à payer les frais de justice du défendeur n’aurait dû être prononcée.

Les questions que présentent cette affaire sont les suivantes : un défendeur qui l’emporte dans une action FEHA est-il en droit d’obtenir le remboursement de ses frais de justice par son adverse partie au sens de la Section 1032 du Code de procédure civile, ou peut-il obtenir ce remboursement selon la discrétion de la cour au sens de la Section 12965 du Code Gouvernemental, une disposition contenue dans la loi FEHA ? Et, si la cour dispose d’une compétence discrétionnaire, cette discrétion doit-elle être exercée conformément à la règle applicable aux dépens dans le cadre de certaines procédures fédérales où des droits civils sont en jeu, au sens de la jurisprudence Christiansburg rendue par la Cour Suprême fédérale ? Selon cette jurisprudence, un défendeur ne peut se voir allouer des dépens que si l’action du demandeur était objectivement sans fondement.

En l’espèce, la Cour Suprême de Californie juge que la Section 12965, Subdivision (b), du Code Gouvernemental régit la question de l’allocation des frais de justice dans le cadre des actions FEHA, accordant aux cours de première instance discrétion dans l’allocation aussi bien des frais d’avocats (dépens) que des frais de justice en faveur de la partie qui l’emporte. La Cour juge en outre qu’en allouant frais et dépens, la discrétion de la cour de première instance est cadrée par la jurisprudence Christiansburg. Un demandeur FEHA qui succombe ne doit pas être condamné à payer les frais et honoraires sauf si le demandeur avait introduit son action, ou l’avait poursuivie, sans une base objective lui permettant d’estimer que son action présentait des chances de succès.

Selon la Section 1032, Subdivision (b) du Code de procédure civile, est accordé à la partie qui l’emporte le remboursement de ses frais de justice par la partie perdante. Sauf dans les cas expressément prévus par d’autres lois, une partie victorieuse est de droit fondée à voir son adversaire condamné à lui rembourser ses frais de justice.

La Section 1033.5 du Code de procédure civile limite les frais de justice qui peuvent être remboursés : seuls peuvent l’être ceux raisonnablement nécessaires à la conduite de la procédure, et raisonnables quant à leurs montants. La Section détaille également le type de dépenses qui peuvent être qualifiées de coûts au sens de la section 1032 : sont concernés les frais de dépôt de mémoires, les requêtes, le défraiement des jurés, les frais de repas et d’habitation des jurés fonctionnant à huis clos, les coûts liés à la déposition nécessaire d’un témoin, les coûts de notifications à l’adverse partie, le défraiement des témoins ordinaires et des experts commis par la cour, les coûts des transcriptions ordonnées par la cour, les coûts liés à l’établissement de garanties, les débours des interprètes, et les coûts des tirés à part utiles aux jurés. Pour leur part, les frais d’avocat et les honoraires des experts des parties ne sont pas ordinairement remboursables en tant que coûts au sens de la section 1032.

La Section 12965, Subdivision (b) du Code du Gouvernement règle les actions civiles fondées sur FEHA. Il dispose notamment que dans les actions civiles introduites sous l’angle de cette section, la cour peut discrétionnairement accorder à la partie victorieuse ses frais d’avocat, de justice, et d’experts privés, dans les limite du raisonnable.

Dans une action fondée sur le Titre VII de la loi fédérale de 1964 sur les droits civils, la cour de première instance peut allouer de manière discrétionnaire à la partie qui l’emporte une contribution raisonnable à ses frais d’avocats, comme partie de ses coûts. Dans sa jurisprudence Christiansburg, la Cour Suprême fédérale a interprété cette provision discrétionnaire comme créant un standard différencié d’allocation des frais d’avocats à charge du défendeur par rapport aux frais d’avocat du demandeur. Les demandeurs victorieux dans le cadre de leurs actions fondées sur le Titre VII se voient ordinairement alloués des dépens à charge de leur adverse partie. Cette conception se rattache à la politique voulue par le Congrès et dirigée contre la discrimination sur la place de travail. Un demandeur qui succombe dans le cadre d’une action fondée sur le Titre VII n’a pas à verser de dépens à son adverse partie, à moins que le Tribunal ne juge que son action était frivole, déraisonnable, ou sans fondement, ou que le demandeur poursuive la procédure alors qu’elle était apparue clairement frivole, déraisonnable ou sans fondement. L’histoire législative du Titre VII indique que le but de ses dispositions régissant les dépens est de permettre plus facilement à des demandeurs aux moyens financiers limités d’agir en justice. Attribuer des dépens au défendeur uniquement du fait que le demandeur a finalement été débouté est de nature à rendre la procédure plus risquée qu’elle ne l’est dans un cadre ordinaire, limitant ainsi les efforts du Congrès visant à promouvoir la mise en œuvre vigoureuse des dispositions du Titre VII. La jurisprudence Christiansburg concerne les dépens, non les frais de justice, et la Cour Suprême fédérale n’a pas encore eu l’opportunité de décider si le même standard asymétrique s’applique à la question de l’allocation des frais de justice en faveur d’un défendeur victorieux dans le cadre d’une action fondée sur le Titre VII.

Comme indiqué précédemment, la Section 1032 (b) du Code de procédure civile dispose que les défendeurs victorieux ont droit au remboursement de leurs frais (dépens non compris), à moins qu’une loi n’en dispose expressément autrement. En l’espèce, la Cour Suprême de Californie juge que la Section 12965(b) du Code du Gouvernement constitue une exception expresse à la Section 1032(b) du Code de procédure civile, de sorte que cette première Section détermine l’allocation des coûts de procédure dans les actions FEHA, et non la Section 1032(b) du Code de procédure civile. La section 12965(b) ordonne expressément l’application d’un standard différent que le standard prévu par la Section 1032(b). les coûts qui seraient de droit alloués à la partie qui l’emporte en application de la Section 1032(b) sont laissés à la discrétion de la cour de première instance selon la section 12965(b). En rendant l’allocation des coûts discrétionnaire plutôt qu’obligatoire, la Section 12965(b) exempte expressément les actions FEHA des exigences de la Section 1032(b) qui, elle, impose à la partie perdante la prise en charge des frais de justice de la partie qui l’emporte.

En interprétant la FEHA, les Tribunaux californiens s’inspirent souvent des décisions qui appliquent les lois fédérales contre la discrimination, comprenant le Titre VII de la loi fédérale de 1964 sur les droits civils. Mais l’interprétation que les cours fédérales ont donné du Titre VII n’aide que si le langage de la loi fédérale interprétée est similaire à celui de la loi californienne à interpréter. A cet égard, le Titre VII dispose que la cour de première instance, de manière discrétionnaire, peut allouer à la partie qui l’emporte une indemnité de dépens comme partie des frais. Cette disposition est ainsi semblable à la Section 12965(b) du Code Gouvernemental s’agissant des dépens, mais non s’agissant des frais de justice usuels. Le Titre VII dispose par conséquent que l’allocation des frais d’avocat est discrétionnaire, tandis que l’allocation des frais de justice ne l’est pas. Les frais de justice sont à rembourser au demandeur qui l’emporte par le défendeur qui succombe.

Par contraste, aussi bien la loi fédérale réglementant les cas d’invalidité que la FEHA californienne étendent expressément la discrétion du Tribunal à l’allocation des frais d’avocat et des frais de justice. Comme le texte déterminant de la Section 12965(b) du Code gouvernemental se rapproche davantage des dispositions de l’ADA que de celles du Titre VII, les décisions fédérales appliquant l’ADA sont plus pertinentes que celles appliquant le Titre VII dans le cadre de la résolution de la présente affaire.

A sa lecture, le texte de la Section 12965(b) du Code gouvernemental ne distingue pas entre ce qui est alloué au demandeur FEHA et ce qui est alloué au défendeur FEHA. Dite Section attribue simplement aux cours de première instance discrétion quant à l’allocation des frais et dépens à la partie victorieuse. Mais l’histoire législative de la loi persuade la présente Cour Suprême que l’intention du Législateur était d’ordonner aux cours de première instance l’usage du standard asymétrique de la jurisprudence Christiansburg aussi bien s’agissant des frais d’avocat que s’agissant des frais de justice. FEHA est entrée en vigueur en 1980. Cette loi combinait les dispositions de deux lois antérieures, soit la loi californienne sur des pratique équitables dans les relations de travail, et la loi californienne sur des pratiques équitables en matière de location de logements. Une disposition de cette première loi, autorisant les actions civiles fondées sur des actes de discrimination, était la prédécesseur directe de la Section 12965(b) du Code gouvernemental. Amendée en 1978, cette disposition de la loi sur des pratiques équitables dans les relations de travail prévoyait que dans de telles actions en discrimination, la cour pouvait discrétionnairement allouer à la partie qui l’emportait aussi bien ses frais d’avocat dans une mesure raisonnable que ses frais de justice. Cette disposition a été plus tard recodifiée en tant que section 12965(b) du Code gouvernemental, sans modifications relevantes.   

Le Législateur californien était ainsi conscient de la règle asymétrique appliquée dans les actions fondées sur le Titre VII. Il souhaitait reprendre cette règle asymétrique dans son droit. Bien que la discrétion du Titre VII n’a plus tard été appliquée que s’agissant des frais d’avocat, le Législateur californien a usé d’un langage adoptant la discrétion pour les frais de justice également, et un langage similaire dans la loi fédérale sur les cas d’invalidité a été depuis lors interprété comme retenant le standard asymétrique prévu par la jurisprudence Christiansburg aussi bien dans le cas des frais de justice que des frais d’avocat.

Pour toutes ces raisons, la Cour Suprême de Californie conclut en l’espèce que le standard de la jurisprudence Christiansburg s’applique à l’allocation discrétionnaire aussi bien des frais d’avocat que des frais de justice de la partie qui l’emporte dans le cadre d’actions FEHA sous l’angle de la Section 12965(b) du Code gouvernemental. Concrètement, un demandeur FEHA qui l’emporte se verra ordinairement allouer ses frais de justice et ses frais d’avocat à moins que des circonstances spéciales rendraient injuste une telle allocation. Cependant, un défendeur qui l’emporte n’aura pas droit au remboursement de ses frais de justice et d’avocat, à moins que le Tribunal ne juge que l’action était objectivement dépourvue de fondement quand elle a été introduite, ou que la procédure a été poursuivie alors qu’était apparue une telle absence de fondement. Trois décisions récentes (2003, 2005, et 2013) de la Cour Suprême de Californie sont abrogées en tant qu’elles avaient jugé que les frais de justice n’étaient pas soumis au standard établi dans la présente affaire.

Ricci v. DeStefano

Civil Rights Act of 1964, Title VII ; Title VII prohibits intentional acts of employment discrimination based on race, color, religion, sex, and national origin, 42 U. S. C. §2000e–2(a)(1) (disparate treatment), as well as policies or practices that are not intended to discriminate but in fact have a disproportionately adverse effect on minorities, §2000e–2(k)(1)(A)(i) (disparate impact). Once a plaintiff has established a prima facie case of disparate impact, the employer may defend by demonstrating that its policy or practice is “job related for the position in question and consistent with business necessity.” Ibid. If the employer meets that burden, the plaintiff may still succeed by showing that the employer refuses to adopt an available alternative practice that has less disparate impact and serves the employer’s legitimate needs. §§2000e–2(k)(1)(A)(ii) and (C); all the evidence demonstrates that the City rejected the test results because the higher scoring candidates were white. Without some other justification, this express, race-based decisionmaking is prohibited; the Court held that certain government actions to remedy past racial discrimination—actions that are themselves based on race—are constitutional only where there is a “strong basis in evidence” that the remedial actions were necessary. Richmond v. J. A. Croson Co., 488 U. S. 469, 500; see also Wygant v. Jackson Bd. of Ed., 476 U. S. 267, 277; “evidentiary support for the conclusion that remedial action is warranted becomes crucial when the remedial program is challenged in court by nonminority employees; the City’s race-based rejection of the test results cannot satisfy the strong-basis-in-evidence standard; such a prima facie case—essentially, a threshold showing of a significant statistical disparity, Connecticut v. Teal, 457 U. S. 440, 446, and nothing more—is far from a strong basis in evidence that the City would have been liable under Title VII had it certified the test results. That is because the City could be liable for disparate impact discrimination only if the exams at issue were not job related and consistent with business necessity, or if there existed an equally valid, less discriminatory alternative that served the City’s needs but that the City refused to adopt. §§2000e–2(k)(1)(A), (C). Based on the record the parties developed through discovery, there is no substantial basis in evidence that the test was deficient in either respect; fear of litigation alone cannot justify the City’s reliance on race to the detriment of individuals who passed the examinations and qualified for promotions. Discarding the test results was impermissible under Title VII, and summary judgment is appropriate for petitioners on their disparate-treatment claim. If, after it certifies the test results, the City faces a disparate-impact suit, then in light of today’s holding the City can avoid disparate-impact liability based on the strong basis in evidence that, had it not certified the results, it would have been subject to disparate-treatment liability (U.S.S.Ct., 29.06.09, Ricci v. DeStefano, J. Kennedy)

Loi fédérale sur les droits civils de 1964, Titre VII : le Titre VII proscrit les actes intentionnels de discrimination sur le lieu de travail, discrimination fondée sur la race, la couleur, la religion, le sexe, et la nationalité (traitement disparate). Sont également proscrites les politiques et pratiques qui ne visent pas à discriminer mais qui ont en fait un effet adverse sur les minorités, effet adverse qui est disproportionné (impact disparate). Une fois que le demandeur a établi prima facie que son dossier relève de l’impact disparate, l’employeur peut se défendre en démontrant que sa politique ou sa pratique est en lien avec l’emploi en question et relève des nécessités de l’activité professionnelle en question. Si l’employeur apporte cette preuve, le demandeur peut encore l’emporter en démontrant que l’employeur refuse d’adopter une pratique alternative à disposition qui entrainerait un impact disparate moindre et qui servirait les besoins légitimes de l’employeur. L’ensemble des preuves démontre que la ville a rejeté les résultats de l’examen parce que les meilleurs résultats ont été obtenus par des candidats de race blanche. Sans autre justification, cette décision basée sur la race est prohibée. La Cour avait jugé que certaines actions gouvernementales pour remédier à des discriminations raciales passées (actions basées sur la race) étaient constitutionnelles seulement si elles étaient basées sur des preuves solides que les actions correctrices étaient nécessaires. Les preuves à disposition s’agissant de savoir si l’action correctrice était justifiée sont essentielles lorsque dites actions sont contestées en justice par des employés qui n’appartiennent pas à la minorité. Le rejet par la ville, rejet fondé sur des raisons raciales, du résultat des examens ne satisfait pas au critère des preuves solides justifiant l’action ; un cas prima facie comme celui-ci, impliquant essentiellement la preuve d’un seuil d’une disparité statistique significative, et rien de plus, est loin de la notion de « solide preuve » que la ville aurait été responsable de discrimination selon le Titre VII si elle avait certifiée les résultats de l’examen. Cela s’explique du fait que la ville aurait été responsable de discrimination fondée sur un impact disparate seulement si les examens en question n’étaient pas liés à l’emploi et conformes aux nécessités de la profession, ou alors s’il existait une solution alternative également valable, moins discriminatoire, conforme aux besoins de la ville mais que la ville aurait refusé d’adopter. Basé sur le dossier que les parties ont constitué pendant la phase de discovery, aucune preuve solide ne permet de conclure que l’une ou l’autre des deux situations précitées étaient réalisées. La peur d’un procès ne peut à elle seule justifier une décision basée sur la race au détriment des personnes qui ont réussi l’examen et qui sont ainsi qualifiées pour des promotions. Rejeter le résultat des examens n’était pas permis selon le Titre VII, et un summary judgment est approprié en faveur des requérants s’agissant de leur requête fondée sur un traitement disparate. Si, après avoir accepté le résultat des examens, la ville fait face à une action en impact disparate, alors à la lumière des considérants de la présente espèce la ville peut éviter une responsabilité fondée sur un impact disparate en alléguant que la présente espèce reconnaît qu’en n’acceptant pas le résultat de l’examen, elle était responsable d’un traitement disparate.