Earlier this year, a three-judge panel of the Fifth Circuit Court of Appeals unanimously rejected the notion that Title VII of the Civil Rights Act protects individuals from discrimination on the basis of their sexual orientation or transgender status. More than a standard-issue opinion, however, the Fifth Circuit’s holding was a laser-focused rebuke of a widely-publicized district court opinion which held Title VII’s prohibition on sex-discrimination applies to transgender individuals.
To review the bidding; in Wittmer v. Phillips 66, Nicole Wittmer, a transgender woman, claimed Phillips unlawfully discriminated against her on the basis of her transgender status when the company rescinded its job offer. Phillips countered that (i) Title VII does not protect individuals on the basis of their status as transgender, (ii) regardless of the former, Wittmer failed to make a prima facie case of discrimination because there was no evidence of disparate treatment, and (iii) even if she had, Phillips had a legitimate, non-discriminatory reason for rescinding the job offer for which no pretext could be demonstrated.
On April 4, 2018 Judge Lee Rosenthal—the Chief Judge for the Southern District of Texas—issued an order granting Phillips’ motion for summary judgement and dismissing Wittmer’s action. But in so doing, the order unequivocally stated that Title VII protects transgender individuals from sex discrimination. The opinion garnered substantial attention, largely because of nationwide astonishment that an undeniably-progressive ruling on Title VII transgender protection would emerge from a Texas federal court.
Wittmer, having lost on the merits, appealed to the Fifth Circuit. And the country waited to see if one of the most reliably-conservative courts in the nation had trended left on a civil rights issue that has dominated the national conversation over the past two years. It had not.
On February 6, 2019 the Fifth Circuit issued an opinion upholding the district court’s order granting summary judgment for Phillips. But in so doing, it minced no words rebuking the most noteworthy aspect of the lower court’s opinion: that transgender status is protected by Title VII.
Specifically, the Fifth Circuit claimed the district court improperly failed to consider its 1979 holding in Blum v. Gulf Oil, which expressly ruled Title VII does not prohibit discrimination on the basis of sexual orientation. The Court of Appeals’ language was unquestionably pointed and, in so many words, accused the district court of ignoring prominent, three-decade old precedent:
The district court here  thus assumed that Title VII prohibits transgender discrimination [and] [i]n doing so…expressly stated that the Fifth Circuit has not yet addressed the issue. But we have addressed the issue. In [Blum], we expressly held that Title VII does not prohibit discrimination on the basis of sexual orientation. Yet the district court did not mention, let alone distinguish, Blum. Most notably, it did not contend that Title VII applies to transgender status but not to sexual orientation. To the contrary, the court concluded that the “same” analysis applies to transgender status and sexual orientation alike. Blum remains binding precedent in this circuit to this day.
While the form of the Court’s opinion was somewhat dramatic, the ultimate result was unsurprising. The Fifth Circuit remains one of the most conservative benches in the country, and no change is visible on the horizon. But—as even the Court of Appeals’ opinion acknowledged—the national legal trendline may still be moving towards expansion of rights under Title VII. Over the past two years, three circuit Courts of Appeal have found Title VII prohibits employers from discriminating on the basis of either sexual orientation or transgender status. Consequently, national employers should consult with outside employment counsel about the impact of differing interpretations of Title VII between the federal circuits when crafting and implementing policies and procedures.