A Win for Equal Pay: The Third Circuit Court of Appeals Upholds A Law Designed to Address Wage Gap

JOANNA L. GROSSMAN

SMU Dedman School of Law professor Joanna L. Grossman comments on a recent decision by the U.S. Court of Appeals for the Third Circuit upholding a local law designed to address the wage gap. Grossman describes the landscape of equal pay law and the efforts some states and localities have made to address the inequity.

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Quality Associates., Inc v. Procter & Gamble Distributing Center, LLC

Docket: 19-3137

Opinion Date: February 10, 2020

Judge: Karen Nelson Moore

Areas of Law: Civil Procedure

QAI sued P&G in federal court for breaking a contract with it in a racially discriminatory manner, 42 U.S.C. 1981. P&G had already sued QAI in Ohio state court over the same contractual dispute underlying QAI’s section 1981 claim; that litigation was still ongoing. P&G moved to dismiss QAI’s federal suit, arguing that its section 1981 claim was a compulsory counterclaim to the state litigation, Ohio Civ. R. 13(A). The district court dismissed QAI’s suit. The Sixth Circuit reversed. A federal court cannot enforce a state compulsory-counterclaim rule against a federal litigant outside the preclusion context, and because QAI’s claim is not yet precluded here (because the state court has not yet entered a final judgment), the district court lacked authority to base its judgment of dismissal on this ground. That this case implicates compulsory counterclaims does not alter the basic federalist principle that litigants are free to split their claims between state and federal court and “race to the first judgment,” even if that stratagem is ill-advised and inefficient.