On April 4, 2017, the United States Court of Appeals for the Seventh Circuit became the first federal appellate court to hold that discrimination on the basis of sexual orientation is a prohibited form of sex discrimination under Title VII of the Civil Rights Act of 1964 (Title VII).  And it did so in no uncertain terms.  This en banc decision – a decision made by the entire active bench of Seventh Circuit judges – was the Court’s second time hearing the Hively v. Ivy Tech Community College case.  In its initial run at the matter, the Seventh Circuit, by a panel of three judges, expressed that it was bound by the Circuit’s prior precedent that sexual orientation discrimination was not prohibited under Title VII.  In its opinion, the panel questioned the ongoing validity of that precedent, but noted that only the full court had the authority to overrule its past decisions.  Responding to this seeming invitation, Plaintiff Hively moved the appellate court to rehear the matter en banc, and the Court agreed to do so.

Accordingly, the full Circuit Court reexamined its precedent regarding the protection of sexual orientation under Title VII, and ultimately found it to be outdated in the context of the current legal landscape.  In her appeal, Hively posed two lines of analysis, both which she asserted led to the conclusion that sexual orientation discrimination is prohibited under Title VII.  The Seventh Circuit agreed on both fronts.  The first approach was the “comparative method,” an analysis in which the Court considered whether Plaintiff’s sex was the single factor upon which the alleged discrimination occurred.  In other words, were Hively male, but all other factors remained the same, including the sex of Hively’s chosen spouse, would she have been treated the same?  Hively asserted that, had she been a man married to a woman, her employer would have treated her more favorably.  This, the Court determined, was “paradigmatic” discrimination based on sex.

The second approach addressed by the Court was an “associational method.”  The Court remarked that it has long been established that discrimination against someone on the basis of their association with someone of a different race constitutes discrimination on the basis of race.  Sexual orientation discrimination is based upon the theory that a plaintiff is subjected to adverse circumstances due to his or her intimate association with someone of the same sex.  The Hively Court found there is no fundamental difference between race and sex discrimination claims, therefore, no justification exists to treat them differently in the associational analysis, and accordingly, sexual orientation discrimination is sex discrimination.

The Court further supported its outcome with other recent developments in the law regarding sexual orientation.  The Seventh Circuit cited the EEOC’s position that sexual orientation discrimination is sex discrimination under Title VII, but, notably clarified it did not feel obligated to defer to the EEOC.  The Court placed more weight on three recent decisions from the Supreme Court of the United States.  These three Supreme Court cases dealt not with discrimination in employment, but other fundamental liberties, namely the criminalization of homosexuality, exclusion of same-sex couples from coverage under certain federal statutes (as proposed in the Defense of Marriage Act), and most recently, directly addressing the right to marry.  In all three cases, the Supreme Court found that sexual orientation is an improper basis upon which individuals may be differentiated.  The Seventh Circuit found that the logic behind these cases, as well as the “common-sense reality that it is actually impossible to discriminate on the basis of sexual orientation without discriminating on the basis of sex” required it to overrule its prior precedent.

Although this outcome is only binding within the borders of the 7th Circuit (Illinois, Indiana, and Wisconsin), plaintiffs are certain to test the Hively Court’s logic in the remaining Circuits.  However, they will do so amid existing, opposing Circuit Court authority.  Indeed, the Second Circuit came to the opposite conclusion just last week in Christiansen v. Omnicom.  In Omnicom, the Second Circuit distinguished between discrimination on the basis of a perceived gender stereotype and discrimination due solely based on the fact of someone’s sexual orientation.  Holding without significant comment that the latter is not a cognizable claim under Title VII, the Second Circuit held a plaintiff could, however, state a claim if he or she alleged discrimination on the basis of a specific characteristic not stereotypically associated with their gender (such was the case for Christiansen, who alleged he was perceived to be effeminate and submissive).  The Hively Court also addressed and spurned this distinction, finding the line between gender nonconformity claims and one based on sexual orientation “does not exist at all.”  The Omnicom majority opinion did not address the associational theory of sex discrimination claims taken up by the Seventh Circuit, but the Omnicom dissent, like the Hively Court, found that discrimination on the basis of sexual orientation is supported under both the comparative and associational analyses.

Hively marks a vast discrepancy among the Circuits, and accordingly, this issue is most certainly well-positioned for consideration by the U.S. Supreme Court.