In the 1981 case American Tobacco Co. et al. v. Patterson et al., the U.S Supreme Court ruled in favor of American Tobacco Company, overturning a lower court's decision that had favored employees alleging racial discrimination under Title VII of the Civil Rights Act of 1964. The plaintiffs were black tobacco workers who claimed they were passed over for promotions due to their race and that seniority system was discriminatory against them because it perpetuated past racial bias by giving preference to long-term employees, who were predominantly white due to previous segregation policies at work place. The Supreme Court held that while Title VII prohibits racially discriminatory practices, it does not guarantee minority workers absolute preference in promotion decisions or require employers to abandon traditional seniority systems unless there is clear proof these systems are intentionally designed or used as tools for discrimination.

In the dissenting opinion for American Tobacco Co. et al. v. Patterson et al., Justice Thurgood Marshall, joined by Justices Brennan and Blackmun, argued that the majority misinterpreted Title VII of the Civil Rights Act of 1964 in their decision to uphold a seniority system that perpetuated racial discrimination in employment opportunities at American Tobacco Company. The dissenters contended that Congress intended Title VII to eliminate not just overt discrimination but also practices which are fair in form but discriminatory in operation; they believed this included seniority systems which lock minorities into inferior positions due to past discrimination. They further criticized the majority's reliance on Teamsters v United States (1977), arguing it was wrongly decided and should be overruled because it allowed employers who had discriminated before 1965 to continue benefiting from those illegal actions through maintaining racially biased seniority lists.