## Facts

- Olson’s Dairy Queens, Inc. operated multiple Dairy Queen restaurants in the Houston, Texas area.
- A Black employee filed an EEOC charge alleging race-based mistreatment and later alleged discriminatory pay and discharge; the EEOC found no reasonable cause as to her individual claims.
- The EEOC nevertheless pursued a separate charge alleging Olson’s failed to hire Black applicants because of race, sought conciliation (including monetary relief for numerous applicants), and later sued after conciliation failed.
- The case was tried to the court without a jury; the EEOC proceeded on both disparate treatment and disparate impact theories under Title VII.
- The district court entered judgment for Olson’s, finding no intentional discrimination and no unlawful disparate impact; the EEOC appealed, emphasizing statistical proof and the disparate impact ruling.

## Issues

1. Whether the district court clearly erred in finding the EEOC failed to prove intentional race discrimination in hiring (disparate treatment) under Title VII.
2. Whether the district court erred in rejecting the EEOC’s disparate impact theory, including by discounting the EEOC’s statistical analysis and applicant-pool comparisons.

## Decision

- The Fifth Circuit affirmed the judgment for Olson’s.
- The court held the district court’s finding of no intentional discrimination was not clearly erroneous.
- The court held the EEOC did not establish a prima facie disparate impact case because its statistics did not use an appropriate qualified applicant pool, did not persuasively account for relevant variables, and did not link any disparity to a specific hiring practice.

## Legal Principles

- Appellate review of a bench trial’s factual findings, including findings about intent and the weight of statistical evidence, is for clear error; where the factfinder’s view is plausible, it will not be disturbed.
- A Title VII disparate impact claim must identify a specific employment practice and show, typically through reliable statistical evidence, that the practice caused a significant adverse impact on a protected group.
- In hiring cases, the relevant comparison generally focuses on the qualified and interested applicant pool versus those hired; general population or broad labor-market figures may have limited probative value if not shown to be coextensive with actual applicants.
- Courts may discount statistical analyses that rest on flawed assumptions, omit key variables, or fail to isolate the challenged practice as the cause of the alleged disparity.
- Subjective hiring criteria may be challenged under disparate impact theory, but a plaintiff must still connect identified subjective practices to demonstrated statistical disparities.

## Conclusion

The Fifth Circuit upheld judgment for the employer because the district court permissibly credited non-discriminatory explanations and found the EEOC’s proof insufficient: it did not show intentional discrimination, and it failed to present a statistically sound disparate impact case tied to a specific hiring practice and an appropriate qualified applicant pool.


Equal Emp. Opportunity Comm’n v. Olson’s Dairy Queens, Inc., 989 F.2d 165 (5th Cir. 1993)