EEOC Ordered to Pay Millions to CRST Van Expedited

A federal judge in Iowa has ordered the U.S. Equal Employment Opportunity Commission to pay $4.7 million to CRST Van Expedited for attorney’s fees and expenses the company racked up while defending itself in a sexual harassment case the judge called “unreasonable or groundless.”

The move by U.S. District Judge Linda Reade is believed to be the largest-ever fee sanction against the EEOC.

The harassment suit started with a December 2005 complaint from driver Monika Starke of Azle, Texas. Starke said she was paired with a driver trainer who constantly made crude sexual remarks and advances. The next driver trainer she paired with, she alleged, demanded sex in exchange for a passing grade.

The EEOC was unable to reach a settlement with CRST for Starke, so it filed a lawsuit in 2007 on behalf of all female drivers subjected to "a sexually hostile and offensive work environment."

The lawsuit was filed before the agency knew how many employees would be part of the case. The agency ultimately identified 270 women, but only 150 showed up for depositions. CRST said it took disciplinary action such as banning offenders from riding with females.

The agency's tactics angered Reade, who called them a "sue first, ask questions later litigation strategy." She dismissed the lawsuit and ordered the EEOC to reimburse the trucking company $4.4 million in legal fees in February 2010.

EEOC appealed. The appeals court largely upheld Reade's decision dismissing the case, but threw out the fee award and reinstated Starke’s claim.

In February, CRST reportedly agreed to pay $50,000 to settle Starke's claim, under a deal that allowed the company to renew its request for legal costs from EEOC.

Reade awarded CRST nearly $4.2 million in attorneys' fees, $413,000 in out-of-pocket expenses and $92,000 in court costs.

The agency is considering an appeal.