Denial of Lateral Transfers Not ‘Adverse' Under Title VII

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By Kevin McGowan

Aug. 2 — A Hispanic federal employee whose lateral transfer requests were denied can't pursue a discrimination lawsuit because the denials weren't “adverse” employment actions, a divided U.S. Court of Appeals for the District of Columbia Circuit ruled ( Ortiz-Diaz v. Dep't of Hous. and Urban Dev., 2016 BL 248844, D.C. Cir., No. 15-5008, 8/2/16 ).

The decision illustrates that it is difficult to show adverse action if a requested transfer wouldn't change an employee's pay or benefits. It also shows federal judges can sharply disagree on how summary judgment standards apply under Title VII of the 1964 Civil Rights Act.

In a 2-1 decision, the court said Samuel Ortiz-Diaz lacks race and national origin bias claims against the Department of Housing and Urban Development, because an employer's denial of lateral transfers generally isn't an adverse job action.

Ortiz-Diaz can't show any special circumstances, such as that the transfers would have increased his promotion opportunities, to justify an exception to the usual rule, Judge Karen LeCraft Henderson wrote in an opinion joined by Judge Brett M. Kavanaugh.

In dissent, Judge Judith W. Rogers said Ortiz-Diaz raised a genuine factual dispute over whether the denied jobs would have improved his advancement opportunities.

Sought Job Closer to Spouse

A senior special agent in HUD's Office of Inspector General in Washington, Ortiz-Diaz in October 2010 requested transfer to an investigative position in Albany, N.Y., or in Hartford, Conn., under the agency's voluntary transfer program.

That program allows employees to seek transfers to desired duty stations, paying their own relocation costs, for reasons other than the agency's staffing needs. Ortiz-Diaz wanted to move closer to his wife, who worked in Albany.

Ortiz-Diaz's supervisor denied his transfer requests. Ortiz-Diaz sued under Title VII, alleging the requests were denied because he is Hispanic.

A federal district court granted summary judgment to HUD, saying that “absent extraordinary circumstances,” denial of a “purely lateral transfer” isn't adverse action.

Denial Wasn't ‘Materially' Adverse

Ortiz-Diaz argued a reasonable jury could find the transfer denials were a “materially adverse action.”

The denials affected his career opportunities because his supervisor in Washington allegedly discriminated against Hispanics and he would have worked for a Hispanic supervisor in Albany, Ortiz-Diaz argued. The opportunity to perform “high-profile work” in Albany or Hartford also would improve his promotion prospects, Ortiz-Diaz said.

But his desire to work for another, allegedly unbiased, supervisor is “irrelevant” to the adverse action inquiry, the appeals court said.

Ortiz-Diaz said the Albany supervisor wouldn't have issues working with Hispanic men. “If such a declaration were sufficient to raise a jury issue, our materiality requirement would be an empty vessel indeed,” the court said.

Ortiz-Diaz offered only “a bare assertion” that his requested transfers would have enhanced his promotion prospects, the court said. That is insufficient to except him from the usual rule that denial of a lateral transfer isn't adverse action, the court said.

In a concurring opinion, Kavanaugh said precedent supports a judgment for HUD but that he is skeptical about the prior cases.

“In my view, a forced lateral transfer—or the denial of a requested lateral transfer—on the basis of race is actionable under Title VII,” he wrote.

Dissent Would Revive Claims

Rogers in dissent said the majority “stumbles badly” in describing a district court's proper role when considering summary judgment.

Ortiz-Diaz presented evidence not merely that he would be more satisfied working in Albany or Hartford, but that he would be better positioned to advance, the dissent said.

His sworn declarations about the professional advantages of the requested moves, which HUD didn't dispute, raise a jury issue that denial of the transfers was an adverse action, Rogers wrote.

Ortiz-Diaz's lawyer at Brown Gaines LLC wasn't available for comment Aug. 2. The U.S. attorney's office in Washington, which represented HUD, declined to comment.

To contact the reporter on this story: Kevin McGowan in Washington at

To contact the editor responsible for this story: Susan J. McGolrick at

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