Wood v. San Diego

A pension plan that has a disparate impact with respect to sex does not violate Title VII of the Civil Rights Act of 1964, so long as the pension plan is facially neutral.

Janet Wood challenged the surviving spouse benefit of San Diego’s retirement fund under Title VII of the Civil Rights Act of 1964, arguing that the surviving spouse benefit discriminates on the basis of sex. The district court dismissed Wood’s claims of disparate impact and disparate treatment. The Ninth Circuit affirmed the disparate treatment claim on the basis that Wood was challenging a facially neutral law and failed to prove that the City of San Diego (“the City”) had a discriminatory intent. The Court also affirmed the district court’s ruling that Wood should not be granted leave to amend the complaint for a second time because she could not, in good faith, allege any facts that would prove a discriminatory intent. The Court affirmed the dismissal of the disparate impact claim as a matter of law instead of lack of constitutional standing. The Court found that the Supreme Court’s opinion in City of Los Angeles, Department of Water & Power v. Manhart was directly on point. Manhart concluded that pension plans need only be facially neutral and that these facially neutral plans would necessarily have a disparate impact on certain people. For example, men would necessarily subsidize women because women live longer. Similarly, smokers would necessarily subsidize non-smokers. Because the disparate impact is not a violation of Title VII, the Court concluded that regardless of whether Wood had standing, the claim must be dismissed as a matter of law under Manhart. AFFIRMED.