On June 2, 2025, the U.S. Supreme Court rejected the appeal of a Fifth Circuit Court of Appeals decision interpreting the limitations period for filing lawsuits under Section 1981 of the Civil Rights Act of 1866. Section 1981 prohibits discrimination on the basis of race in contracting and is often used by plaintiffs who miss the 180-day period for filing EEOC charges under Title VII. The statute of limitations for Section 1981 claims is four years.
In Nicholson v. W.L York Inc., the plaintiff was an exotic dancer who alleged that the clubs where she worked as a contractor limited the number of Black dancers on any given night. She claimed that the discriminatory acts began in 2014, and lasted up to the time she sued in 2021. The Fifth Circuit affirmed dismissal of the lawsuit, concluding that Section 1981’s limitations period begins running upon the initial discriminatory action. Additional similar actions do not start the clock running again.
By declining the request for review, the Supreme Court allowed this interpretation to stand, at least in the Fifth Circuit. Justices Sonia Sotomayor and Ketanji Brown Jackson issued a sharp dissent, claiming that the court ignored plain error by the Fifth Circuit in dismissing the claims. They stated that the more recent denials constituted discrete discriminatory acts that fall within Section 1981’s statute of limitations. To interpret the statute differently rewards employers by limiting claims for long-term and sustained discrimination.
Employers faced with Section 1981 claims should carefully review the plaintiff’s claims to construct a timeline of events that could be used to request dismissal based on failure to sue within four years after the alleged discrimination began.
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