Petition for Writ of Certiorari — Delta Air Lines, Inc. v. Criswell

B8-1ise | Yrs

No.

; JAN 10 1989

JOSEPH F. SPANIOL, JR

IN THE CLERK

Supreme Court of the United States

OCTOBER TERM, 1988

DELTA AIR LINES, INC.,

Petitioner,

Vv.

CHARLES G. CRISWELL,

_ Respondent,

EUGENE R. BLACK, et al.,

Respondents.

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

WILLIAM H. BOICE

(Counsel of Record)

THOMAS J. MUNGER

KILPATRICK & CODY

Suite 3100

100 Peachtree Street

Atlanta, Georgia 30303

(404) 572-6500

ROBERT S. HARKEY

GREGORY L. RIGGS

LEGAL DEPARTMENT

DELTA AIR LINES, INC.

Hartsfield Atlanta

International Airport

Atlanta, Georgia 30320

(404) 765-2611

Counsel for Petitioner

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WILSON - Epgs PRINTING Co., INC. - 789-0096 - WASHINGTON, D.C. 20001

QUESTIONS PRESENTED

1. Whether the “successorship doctrine” should be ap-

plied in an employment discrimination action to require

an acquiring company to hire employees of an acquired

company who do not meet the independent and presump-

tively lawful job qualifications of the acquiring company?

2. Whether the “successorship doctrine” was properly

applied to find continuity of an acquired company’s op-

erations in an employment discrimination action where

there was to be a temporary continuity of some of the

acquired company’s operations during a transition period

but no continuity of the acquired company’s operations

after the acquisition was complete?

(i)

ii

LIST OF PARTIES

The parties to this appeal are Delta Air Lines, Inc.,*

as Petitioner, and Charles G. Criswell, as Respondent,

and Eugene R. Black, Ernest F. Ellis, Arlie A. Gillespie,

Peter T. Hoffman, Jack L. Keyes, Ben D. Laubacher,

Jr., Robert A. Longwell, Alan L. McLaren, Phil G. Most,

Lynn M. Norton, Glen P. Shannon, Donald C. Thompson

and Henry J. Wiegand, as Respondents.**

* The companies to be listed in accordance with Sup. Ct. Rule

28.1 are Atlantic Southeast Airlines, Inc., Comair, Inc., SkyWest,

Inc., and Gatwick Handling, Ltd.

** Western Air Lines, Inc. was a party-defendant at the time

of the March 30, 1987 Order of the United States District Court

for the Southern District of California that is the subject of this

Petition. However, on April 1, 1987, Western Air Lines, Inc.,

merged with Delta Air Lines, Inc., and Western Air Lines, Inc. no

longer exists. Accordingly, Western Air Lines, Inc. is not a party

to this proceeding.

SARRNEEERRT FIRE =o SOUT PR TAL NN A

TABLE OF CONTENTS

Page

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pe yg |: aac ea iv

ISR TT a ee a 1

ET Re a ne 2

STATUTE AND REGULATION INVOLVED ............... 3

coe ee 8g lt ie | So! | Cea 3

REASON FOR GRANTING THE WRIT.........0............. 6

I. By Applying The “Successorship Doctrine” In

An Employment Discrimination Action To Re-

quire An Acquiring Company To Hire Employees

Of The Acquired Company Who Do Not Meet

The Independent Job Qualifications Of The

Acquiring Company, The Ninth Circuit Has

Conflicted In Principle With The Decisions Of

Other Circuits And Has Decided An Important

Question Of Federal Law Which Has Not Been,

But Should Be, Settled By This Court _............. 6

II. By Determining That There Was Continuity Of

An Acquired Company’s Operations Under The

“Successorship Doctrine’ In An Employment

Discrimination Action Where There Was To Be

A Temporary Continuity Of Some Of The Ac-

quired Company’s Operations During A Tran-

sition Period But No Continuity Of The Ac-

quired Company’s Operations After The Acqui-

sition Was Complete, The Ninth Circuit Has

Conflicted In Principle With The Decisions Of

Other Circuits And Has Decided An Important

Question Of Federal Law Which Has Not Been,

But Should Be, Settled By This Court................. 13

ES NR Ie 19

APPENDIX (Memorandum Decision of Court of Ap-

peals; Order of District Court) -...............000.0000..-..20000.. la

(ili)

iv

TABLE OF AUTHORITIES

Cases: Page

Bellingham Frozen Foods, Inc. v. NLRB, 626 F.2d

) i Cs Rp _; SERSPpmnrernseumereomnnucuraeD reer 9

Brown v. Evening News Association, 473 F. Supp.

ROR ET, BI, Re iiceicesenciiensenetincnnpeittoans 14

Burt v. Ramada Inn of Oxford, Mississippi, 507

F. Supp. 386 (N.D. Miss. 1960) ............................ 15

Criswell v. Western Air Lines, Inc., 514 F. Supp.

384 (C.D. Calif. 1981), affirmed, 709 F.2d 544

(9th Cir. 1983), affirmed, 472 U.S. 400 (1985) .. 7

EEOC v. MacMillan Bloedell Containers, Inc., 503

fe B gi Ese. : ) een 7, 13,14

Fall River Dyeing & Finishing Corp. v. NLRB,

U.S. , 107 B. Ce. SRR6 (1967) ....i........... 16, 17

Forde v. Kee Lox Manufacturing Co., Inc., 584 F.2d

rc: C+ es OER eee ee 14, 15

Golden State Bottling Co., Inc. v. NLRB, 414 US.

RS. RRS Ree eanieen een» ane TOR ny ore 7,9

Howard Johnson Co. v. Detroit Local Joint Execu-

ties B.. 497 UB. BOD (RGT4) nase 7

lervolino v. Delta Air Lines, Inc., 796 F.2d 1408

(11th Cir. 1986), cert. denied, —— U.S. ——,

-¢ So fF), 6

In re National Air Lines, Inc., 700 F.2d 695 (11th

Cir. 1983), cert. denied, 464 U.S. 933 (1983) ..7, 8, 11, 13

Musikiwamba v. ESSI, Inc., 760 F.2d 740 (7th

CR, TD irs acen ges ann-cenorecnnpneeninmcnntinnngeninic 7,8, 11, 14

Slack v. Havens, 522 F.2d 1091 (9th Cir. 1975)........

Thomas Engine Corp., 179 NLRB 1029 (1969),

enforced, United Auto Workers v. NLRB, 442

iP Be) Bk Bt: Re 7p } eens

Statutes:

ek Oe I EE acc sniannnrernncronqencnemmnnbvincseninamniiniate

BO Re Oe I ss ieirreesnescdccrnn:onnniinnnaorniattnnphancentannammenantianio

Be i eI in cicrcntcidprcn tins cinnsdccttiiventmminrtiblaarnnegntie

Regulations:

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a nw hn

IN THE

Supreme Court of the United States

OCTOBER TERM, 1988

No.

DELTA AIR LINES, INC.,

Petitioner,

¥.

CHARLES G. CRISWELL,

oni Respondent,

EUGENE R. BLACK, et al.,

Respondents.

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

Petitioner, Delta Air Lines, Inc. (“Delta”) respect-

fully requests that a Writ of Certiorari issue to review

the judgment and opinion of the United States Court of |

Appeals for the Ninth Circuit entered on October 12,

1988, affirming an Order of the United States District

Court for the Central District of California entered on

March 30, 1987.

OPINIONS BELOW

The memorandum opinion of the United States Court

of Appeals for the Ninth Circuit, entered on October 12,

1988, has not been reported. It is reprinted in the Ap-

pendix hereto, p. la, infra.

2

The Order of the United States District Court for the

Central District of California (Tashima, D. J.), entered

on March 30, 1987, has not been reported. It is reprinted

in the Appendix hereto, p. 7a, infra.

JURISDICTION

On September 9, 1986, Delta and Western Air Lines,

Inc. (“Western”) entered into an Agreement and Plan

of Merger which contemplated that Delta would merge

Western into itself on April 1, 1987. This action began

when Delta informed Respondents (former Western Sec-

ond Officers) that they would not be offered cockpit posi-

tions with Delta because they did not meet Delta’s inde

pendent Second Officer job qualifications. Respondents

then sought an injunction in the United State District

Court for the Central District of California against

Delta by claiming that a May 12, 1981 injunction issued

against Western in an action under the Age Discrimina-

tion in Employment Act, as amended, 29 U.S.C. § 621

et seg. (the “ADEA’’), required Delta to hire them as

Second Officers. On March 30, 1987, the District Court

entered an Order holding that, under the “successorship

doctrine,” the injunction against Western required Delta

to hire the fifteen Respondents as Second Officers even

though they did not meet Delta’s Second Officer job re-

quirements. Pursuant to 28 U.S.C. § 1291, Delta ap-

pealed that Order to the United States Court of Appeals

for the Ninth Circuit. On October 12, 1988, the United

States Court of Appeals for the Ninth Circuit entered

an order affirming the District Court’s March 30, 1987

Order. No petition for rehearing was sought.

The jurisdiction of this Court to review the judgment

of the United States Court of Appeals for the Ninth

Circuit is invoked under 28 U.S.C. § 1254(1).

3

STATUTE AND REGULATION INVOLVED

The Age Discrimination In Employment Act of 1967,

as amended, 29 U.S.C. § 632, provides in pertinent part:

(a) It shall be unlawful for an employer—

(1) to fail or refuse to hire or to discharge any

individual or otherwise discriminate against any

individual with respect to his compensation,

terms, conditions, or privileges of employment,

because of such individual’s age; .. .

(f) It shall not be unlawful for an employer, em-

ployment agency or labor organization—

(1) to take any action otherwise prohibited un-

der subsections (a), (b), (ec) or (e) of this

section where age is a bona fide occupational

qualification reasonably necessary to the normal

operation of the particular business, or where

the differentiation is based on reasonable factors

other than age,....

Code of Federal Regulations, Title 14, Section 121.383

(ec) provides:

No certificate holder may use the services of any

person as a pilot on an airplane engaged in opera-

tions under this part if that person has reached his

60th birthday. No person may serve as a pilot on an

airplane engaged in operations under this part if

that person has reached his 60th birthday.

STATEMENT OF THE CASE

On September 9, 1986, Delta and Western entered into

an Agreement and Plan for Merger which contemplated

that Delta would merge Western into itself on April 1,

1987 and that Western would no longer exist as a cor-

porate entity as of that date. C.R. 425 at 2. At the time

of that Agreement, the fifteen Respondents were em-

ployed by Western as Second Officers.1 Although not

1 Second Officer is a term used by both Western and Delta to

designate the pilot who occupies the third seat behind the Captain

4

required to do so, Delta voluntarily offered the Respond-

ents employment with Delta effective April 1, 1987.

Tr. 6; C.R. 421(a) at 6; C.R. 421/b) at 10; C.R. 423 at

7; C.R. 424 at 8. However, Respondents did not meet

Delta’s independent and long-established qualifications

for its Second Officer positions. Jd. Specifically, Respond-

ents were disqualified from serving as Delta Second Offi-

cers because each was past his sixtieth birthday and

Delta prohibits a pilot disqualified from Captain or

First Officer (co-pilot) service by his age? or other rea-

son from bidding down to or serving in the subordinate

Second Officer position. Zd.; Tr. 7, 10, 30, 31. Accord-

ingly, because they did not meet Delta’s Second Officer

job qualifications, Delta informed Respondents that they

could not be offered that position at Delta but they would

be offered ground positions. Jd.

On March 2, 1987, Respondents filed a Motion with

the United States District Court for the Central District

of California seeking an injunction that would require

Delta to hire them as Second Officers. C.R. 419. In their

Motion, Respondents contended that Delta was a “succes-

sor’ to Western and was therefore bound by a May 13,

1981 injunction issued against Western in an ADEA

action that prohibited Western from applying a similar

but distinct job qualification to Second Officers. C.R. 216;

C.R. 419. Two days before the April 1 acquisition date,

the District Court issued an Order which held that, with

respect to Respondents, Delta is a “successor” to Western

and that therefore Delta was required to employ Re-

spondents as Second Officers, notwithstanding the fact

that they did not meet Delta’s independent qualifications

for that position. See p. 8a, infra. The District Court

. and First Officer (co-pilot) in a three-man cockpit and, among

other things, performs the duties of the flight engineer position.

214 C.F.R. § 121.383(c)}, the Federal Aviation Administration’s

“Age 60 Rule,” prohibits service as a Captain or First Officer upon

reaching the age of 60.

5

explained the basis for its Order by stating, “[i]t ap-

pears to the Court that Western’s and Delta’s flight

operations will not be fully integrated until sometime in

the future. At this point, then, Delta is a successor for

the purposes of the pending motion.” See p. 8a, infra.

Delta appealed that Order to the United States Court of

Appeals for the Ninth Circuit.

In its appeal, Delta argued that the District Court

improperly applied the successorship doctrine to require

Delta to hire as Second Officers former Western em-

ployees who did not meet Delta’s independent Second

Officer job qualifications. Delta also argued that the

District Court had improperly found that Delta was a

successor to Western on the basis of the fact that West-

ern’s pilot work force would not be completely integrated

into Delta’s pilot work force immediately after the

merger since it was undisputed that it would be com-

pletely integrated after a short transition period. In

fact, upon the completion of the merger and the inte-

gration of Western’s work force into Delta’s work force,

it was undisputed that there would be no identifiable

former Western operation. C.R. 425 at 4, 5; C.R. 428

at 3, 4; Tr. 12.

On October 12, 1988, the Ninth Circuit affirmed the

District Court’s Order. See p. la, infra. The Ninth Cir-

cuit held that the successorship doctrine could be applied

to require an acquiring company to hire employees of

the acquired company, even though they did not meet

the job qualifications of the acquiring company. The

Ninth Circuit also held that there was sufficient con-

tinuity of the Western operations to find that Delta was

a successor to Western because Delta had not completely

integrated the two pilot work forces on the April 1, 1987

effective date of the acquisition. Delta then timely filed

this Petition.

6

REASON FOR GRANTING THE WRIT

I. By Applying The “Successorship Doctrine” In An Em-

ployment Discrimination Action To Require An Acquir-

ing Company To Hire The Employees Of An Acquired

Company Who Do Not Meet The Independent Job

Qualifications Of The Acquiring Company, The Ninth

Circuit Has Conflicted In Principle With the Decisions

Of Other Circuits And Has Decided An Important

Question Of Federal Law Which Has Not Been, But

Should Be, Settled By This Court.

By requiring Delta to hire unqualified former Western

employees, the Ninth Circuit applied the successorship

doctrine in an unprecedented manner. It is undisputed

in this action that the Delta Second Officer qualifications

that Respondents failed to meet are presumptively law-

ful. However, even if that were not the case, Delta has

successfully defended these qualifications against a claim

that they were age discriminatory in an ADEA action.

Iervolino v. Delta Air Lines, Inc., 796 F.2d 1408 (11th

Cir. 1986), cert. denied, U.S. ——, 107 S. Ct. 1300

(1987).

When Delta denied Respondents Second Officer posi-

tions because they did not meet Delta’s qualifications,

Respondents did not challenge the lawfulness of these

actions in an ADEA action against Delta. Instead,

Respondents filed a Motion in District Court contend-

ing that they were exempt from Delta’s job qualifica-

tions because that District Court had enjoined West-

3 In that case, Delta maintained that its Second Officer job quali-

fications are either based on reasonable factors: other than age

(“RFOA”’) or, if age based, are justified as a bona fide occupational

qualification (‘““BFOQ”) reasonably necessary to the safe operation

of Delta’s business. Jervolino v. Delta Air Lines, Inc., supra, 796

F.2d at 1411; 29 U.S.C. § 623(f)(1). The jury entered a general

verdict in favor of Delta and the United States Court of Appeals

for the Eleventh Circuit affirmed the decision, holding that there

was “substantial evidence” to support Delta’s RFOA defense and

that Delta’s BFOQ defense was “amply supported by the record.”

Id. at 1419.

7

ern from applying similar, but distinct, qualifications

that had been found to violate the ADEA. By exempting

Respondents from Delta’s Second Officer qualifications.

the District Court and the Ninth Circuit denied Delta

the right to once again establish the lawfulness of its

qualifications and distinguish its qualifications from the

former Western qualifications.* Thus, the Ninth Cir-

cuit’s decision forced Delta to hire employees who clearly

do not meet Delta’s job qualifications without any find-

ing that those qualifications were unlawful. The pre-

cedent set by the Ninth Circuit’s decision both conflicts

in principle with the decisions of other Circuits and pre-

sents an important question of federal law that this

Court has not, but should, address.

In requiring Delta to hire employees that did not meet

its presumptively lawful qualifications, the Ninth Cir-

cuit relied solely on the “successorship doctrine.” This

Court has not yet confronted that doctrine in an employ-

ment discrimination action. Several Circuits, however,

have utilized that doctrine to determine whether an

acquiring company will be required to remedy certain

unremedied unlawful employment practices committed by

the acquired company before the acquisition. Musiki-

wamba v. ESSI, Inc., 760 F.2d 740 (7th Cir. 1985) ;

In re National Air Lines, Inc., 700 F.2d 695 (11th Cir.

1983), cert. denied, 464 U.S. 933 (1983); Slack v.

Havens, 522 F.2d 1091 (9th Cir. 1975); EEOC v. Mac-

Millan Bloedell Containers, Inc., 503 F.2d 1086 (6th Cir.

1974).° Under the doctrine, the acquiring company is

4 For example, unlike Delta, Western formerly allowed down-bids

by Captains to the Second Officer position in a broad variety of

circumstances and the only circumstance in which Western denied

down-bids was by Captains nearing age 60. Criswell v. Western

Air Lines, Inc., 514 F. Supp. 384, 392 (C.D. Calif. 1981).

5 These courts have generally borrowed the doctrine from its

use in the labor law context. See, e.g., Howard Johnson Co., Inc. v.

Detroit Local Joint Executive Bd., 417 U.S. 249 (1975); Golden

State Bottling Co., Inc. v. NLRB, 414 U.S. 168 (1973).

8

treated as an innocent party and it is the acts and em-

ployment decisions of the acquired company that are at

issue. Musikiwamba v. ESSI, Inc., 760 F.2d 740 (7th

Cir. 1985).

In the context in which the successorship doctrine is

normally utilized, a company has unlawfully discrimi-

nated against an employee and is then acquired. Thus,

although the acquiring company may continue to oper-

ate the business of the acquired company in substantially

the same form, the acquired company no longer exists as

an entity from which the victim of discrimination can

seek a remedy. Although the acquiring company is an

innocent party, if it is a “successor” to the acquired

company, courts may order the acquiring company to

remedy the unlawful practices of the acquired company

(e.g., by reinstating with back pay an employee dis-

criminatorily discharged by the acquired company). See,

e.g., Musikiwamba v. ESSI, Inc., 760 F.2d 740, 746 (7th

Cir. 1985). The courts and the National Labor Relations

Board (in the labor law context) have transferred lia-

bility in this context when, but for the acquired com-

pany’s unlawful discharge, the successor would likely

have retained the employee after the acquisition had he

still been employed by the predecessor at the time of the

acquisiiton. Id.; Thomas Engine Corp., 179 NLRB 1029,

1030 (1970). In such cases, the burden placed on the

successor is de minimis because it is merely required to

hire a particular qualified employee. Musikiwamba v.

ESSI, Ine., supra, 760 F.2d at 747. Thus, the burden is

substantially outweighed by the employee’s right to a

remedy even when the discriminating entity has dis-

appeared after an acquisition. Jd.

In contrast, the successorship doctrine is not applied

to require an acquiring company to hire employees who

do not meet its independent job qualifications. See, ¢.9g.,

In re National Air Lines, Inc., 700 F.2d 695 (11th Cir.

1983), cert. denied, 464 U.S. 933 (1983) ; Golden State

PIN a lhe dS

9

Bottling Co., Ine. v. NLRB, 414 U.S. 168, 178, n.4

(1973). In that context, it is the acts of the acquiring

employer that are at issue. If the refusal to hire, or

a job qualification of the acquiring employer, is unlaw-

fully discriminatory, the employees who are not hired

have a remedy merely by filing an employment discrimi-

nation action against the acquiring employer. Thus, un-

less the acts at issue were committed by an acquired

employer that has disappeared, the successorship doctrine

is both unnecessary and inapplicable. As this Court

stated in the labor law context, “the successor’s obliga-

tions do not arise out of its own unfair labor practices.”

Golden State Bottling Co., Inc. v. NLRB, supra, 414 U.S.

at 178, n.4.

Accordingly, although the National Labor Relations

Board will apply the successorship doctrine to require

a successor to reinstate with back pay employees who

were unlawfully terminated by the acquired company,

it will not apply the doctrine to issue a cease and desist

order restricting the successor from engaging in unlaw-

ful acts, even if they are the same acts that were com-

mitted by the predecessor. Id.; Thomas Engine Corp.,

179 NLRB 1029, n.4 (1969), enforced, United Auto

Workers v. NLRB, 442 F.2d 1180 (9th Cir. 1971).

Thus, a successor cannot be required under the doctrine

to hire an individual unlawfully terminated by the

acquired company if it would not have hired the individ-

ual in any event because of its own independent hiring

policies or decisions. See, e.g., Thomas Engine Corp.,

supra, 179 NLRB at 1030; Bellingham Frozen Foods,

Inc. v. NLRB, 626 F.2d 674, 681 (9th Cir. 1980). If it

is the successor’s acts (whether based on the same or an

entirely different policy as the acquired company) that

have deprived the acquired employees of employment,

they must seek a remedy directly against the successor

by showing that its acts were unlawful.

10

In this case, however, the Ninth Circuit has completely

ignored the principles discussed above and has applied

the successorship doctrine in an unprecedented manner.*®

No other court has extended the doctrine in this fashion

to strike down the job qualifications of an acquiring com-

pany without any showing that the qualifications were

unlawful.

The precedent set by this decision should not be ignored

merely because of the similarity between Western’s for-

mer policy and Delta’s policy. The similarities of the

two policies are irrelevant to the Ninth Circuit’s decision.

Under the Ninth Circuit’s decision, an employee who

successfully established that his employer had unlawfully

discriminated against him would be exempt from any

independent job qualifications applied by a company that

acquired the discriminating employer if those qualifica-

tions had the same effect on his employment as the

acquired company’s action. For example, if a terminated

employee successfully established that his employer un-

lawfully terminated him because of an age restriction

and was consequently reinstated, a company that ac-

quired his employer would be required to hire that em-

ployee in the same position even if the employee did not

meet the acquiring company’s independent experience,

skill or even eyesight qualifications. The acquiring com-

pany’s status as a “successor” alone would prevent it

from applying its own qualifications and the “successor”

would have no opportunity to defend its qualifications as

®The Ninth Circuit rejected Delta’s argument presented here

only after it mischaracterized it. Delta did not and does not con-

tend that a successor can never be held liable for a predecessor’s

unlawful employment practice merely because it is an innocent

party. Instead, Delta is contending that a successor can only be

held liable under the successorship doctrine for the unlawful prac-

tices of the predecessor and not its own allegedly unlawful prac-

tices or qualifications. Liability for a successor’s unlawful employ-

ment practices or qualifications can be established only through

a direct action against the successor.

11

being lawful. Indeed, even if those qualifications had

previously been upheld as lawful, the successor could not

uniformly apply them because one of its new employees

had been subjected to age discrimination by his prior

employer.

Finally, the Ninth Circuit’s unprecedented decision

ignores and fails to serve the underlying purpose of the

successorship doctrine as set forth by courts in other

Circuits. In determining whether a successor should be

required to remedy the acts of the predecessor employer

that no longer exists, the courts balance the interests of

the employees and the successor. Musikiwamba v. ESSI,

Inc., 760 F.2d 740 (7th Cir. 1985); In re National Air

Lines, Inc., 700 F.2d 695, 698 (11th Cir. 1983), cert.

denied, 464 U.S. 933 (1983). When applied correctly,

the successorship doctrine upholds the right of an em-

ployee to seek a remedy against an innocent acquiring

company when it has acquired a discriminatory employer

that no longer exists and when it is merely required to

provide a remedy by hiring a specific qualified employee

or group of employees. However, the precedent set by

the Ninth Circuit’s decision ignores that balancing of

interests. The alleged discriminatory employer in this

ease (Delta) still exists and a remedy can be sought

against it directly. The only burden upon Respondents

in this case is the burden placed upon all individuals

who claim they have been discriminated against by a

prospective employer—the burden of proof of establish-

ing employment discrimination in a lawsuit. Moreover,

the burden upon Delta is certainly not de minimis. It

was not merely required to hire a particular group of

qualified employees but instead was required to ignore

long-standing safety qualifications.? Delta has been de-

7The Delta Second Officer qualifications at issue are based in

part upon Delta’s organization of its three-man cockpit crews. All

three Delta cockpit crew members are pilots. The Second Officer

position at Delta is an entry level training position in which a

12

nied the right to uniformly apply this qualification with-

out the opportunity of defending its lawfulness as it has

successfully done in the past.

The Ninth Circuit has applied the successorship doc-

trine in a unprecedented manner to create a special class

of Delta pilots immune from Delta’s presumptively valid

flight safety qualifications. Delta is unaware of any re-

ported decision in another Circuit that has extended the

successorship doctrine in this manner. Delta submits

that the Ninth Circuit’s decision on this important mat-

ter conflicts in principle with the decisions of courts in

other Circuits that restrict the use of the successorship

doctrine to instances where the decision of the acquired

company is at issue. Finally, the Ninth Circuit has de-

cided an important question of federal law and created

an expansive precedent in an area that has not been,

but should be, addressed by this Court. Accordingly, con-

sideration of this matter by this Court is essential.

pilot observes and learns Delta’s flying procedure. Delta has an

“up-or-out” policy pursuant to which a Second Officer eventually

qualifies for and advances to First Officer and ultimately to Captain..

Those pilots who are unable to advance are terminated. This

structure insures that the most senior pilot in the cockpit is the

Captain who is the pilot in command. The next most senior pilot

is the First Officer and the most junior pilot in the cockpit is the

Second Officer. If senior former Captains are allowed to “bid-

down” to the Second Officer position, the predictability of rela-

tionships in Delta’s cockpits would be compromised and the utility

of this training position would be lost. A Delta cockpit with the

most senior pilot occupying the subordinate Second Officer position

is more likely to be a cockpit in which the lines of authority and

command responsibility are blurred. The resulting ambiguity of

roles and relationships is likely to result in cockpit confusion, which

is the antithesis of the predictable and safe environment sought

by Delta.

13

II. By Determining That There Was Continuity Of An

Acquired Company’s Operations Under The “Succes-

sorship Doctrine” In An Employment Discrimination

Action Where There Was To Be A Temporary Con-

tinuity Of Some Of The Acquired Company’s Opera-

tions During A Transition Period But No Continuity

Of The Acquired Company’s Operations After The

Acquisition Was Complete, The Ninth Circuit Has

Conflicted In Principle With The Decisions Of Other

Circuits And Has Decided An Important Question Of

Federal Law Which Has Not Been, But Should Be,

Settled By This Court.

The Ninth Circuit determined that there would be

substantial continuity of Western’s operations after the

acquisition and that therefore Delta was a “successor” to

Western. That decision conflicted at least in principle

with the decisions of other Circuits because the determi-

nation of continuity was based solely upon the extent of

the integration of the predecessor into the acquiring com-

pany at the beginning of a transition period after which

the predecessor would be completely integrated into the

acquiring company. The Ninth Circuit thus chose a date

that did not reflect the undisputed planned outcome of

the acquisition to determine whether the acquisition

would result in the substantial continuity of the opera-

tions of the acquired company. In doing so, the Ninth

Circuit decided a vital question of federal law which has

not been, but should be, addressed by this Court.

As described above, the purpose of an examination of

the “successorship doctrine” in the employment discrim-

ination context is to determine whether an innocent ac-

quiring company will be required to remedy the unrem-

edied, unlawful employment practices engaged in by the

acquired company before the acquisition. Jn re National

Air Lines, Inc., 700 F.2d 695, 698 (11th Cir. 1983), cert.

dened, 464 U.S. 933 (1983); EEOC v. MacMillan Bloe-

dell Containers, Inc., 503 F.2d 1086, 1089 (6th Cir.

14

1974). Courts have adopted a nine-part, fact-specifie in-

quiry to determine whether an acquiring company is a

successor to an acquired company for purposes of an em-

ployment discrimination action. Musikiwamba v. ESSI,

Inc., 760 F.2d 740, 750 (7th Cir. 1985); EEOC v. Mc-

Millan Bloedell Containers, Inc., supra, 503 F.2d at

1094; Slack v. Havens, 522 F.2d 1091 (9th Cir. 1975) ;

Brown v. Evening News Association, 473 F. Supp. 1242,

1244-1245 (E.D. Mich. 1979). These inquiries are: (1)

whether the new company substantially continues the

business operations of the acquired company; (2)

whether the new company uses the same plant; (3)

whether the new company uses the same or substantially

the same work force; (4) whether the new company uses

the same or substantially the same supervisory person-

nel; (5) whether the same jobs exist under substantially

the same working conditions; (6) whether the new com-

pany uses the same machinery, equipment and methods

of production; (7) whether the new company produces

the same product; (8) whether the new company had

notice of the charge against the acquired company; and

(9) the ability of the predecessor to provide relief. Id.

The first seven of the above factors have been called

the “continuity” or “sameness” factors. Slack v. Havens,

522 F.2d at 1095; Musikiwamba v. ESSI, Inc., supra,

760 F.2d at 751; Brown v. Evening News Association,

supra, 473 F. Supp. at 1245. The focus of these con-

tinuity factors is to determine whether the acquiring

company “essentially continues the operations of the

former corporation.” In re National Air Lines, Inc.,

supra, 700 F.2d at 698.

8 Courts in other Circuits have held that the continuity factor

is the most important consideration. For example, in EEOC v.

MacMillan Bloedell Containers, Inc., supra, 503 F.2d at 1089,

the Sixth Circuit referred to the continuity factor as the “key

factor in the determination.” And other courts have held that the

continuity factor must be satisfied before an acquiring company

can be considered a successor. Forde v. Kee Lox Manufacturing

a

15

The Court’s application of the continuity factors in

this case differed significantly from the application of

those factors by courts in other Circuits. In finding that

Delta would continue to operate Western as a separate

entity after the acquisition, the Ninth Circuit and the

District Court relied solely on the narrow factual con-

clusion that the pilot seniority lists for the Delta and

Western pilots would not be fully integrated immediately

upon the effective date of the acquisition. See pp. 4a, 8a,

infra. Instead, Delta had decided that it would continue

to use the Western pilots’ seniority list for Western pilots

and allow former Western pilots to fly former Western

routes and equipment until an integrated pilot seniority

list covering all Delta pilots had been agreed upon and

adopted. Solely because of this transitional step, the

Ninth Circuit held that Delta was continuing to operate

Western as a separate entity indistinguishable from the

pre-acquisition company and that doing so satisfied the

“continuity of operations” factors of the successorship

test.

The Ninth Circuit’s conclusion differed with decisions of

courts in other Circuits for at least two reasons. First,

the Ninth Circuit focused on the continuity of only one

group of employees rather than the overall operation of

Delta’s business after the acquisition. Courts in other

Circuits, however, look to the substantial continuity of

operations in the entire “business enterprise.” Forde v.

Kee Lox Manufacturing Co., Inc., 584 F.2d at 4, 5 (2nd

Cir. 1978); EEOC v. MacMillan Bloedell Containers,

Co., Inc., 585 F.2d 4, 5 (2nd Cir. 1978); Burt v. Ramada Inn of

Oxford, Mississippi, 507 F. Supp. 336, 338 (N.D. Miss. 1980). In

fact, the Seventh Circuit in Musikiwamba v. ESSI, Ine., supra,

stated that the continuity factors were so important in cases such

as this one (that involve a class of individuals seeking injunctive

relief against the acquiring company) that “perhaps no amount

of continuity would suffice” to render the acquiring company a suc-

cessor. 760 F.2d at 751.

eee

16

Inc., supra, 508 F.2d at 1089. Similarly, in applying the

successorship doctrine in the labor law context, this Court

views the “totality of the circumstances” in determining

whether there is a substantial continuity “between the

enterprises” after an acquisition. Fall River Dyeing &

Fininshing Corp. v. NLRB, US. ——, 107 S. Ct.

2225, 2236, 2237 (1987). Accordingly, the Ninth Circuit

ignored a large number of facts that would have been

considered by courts in other Circuits that would have

established that the “totality of circumstances” showed

that Delta would not substantially continue the “busi-

ness enterprise” of Western after the acquisition.°

Second, the Ninth Circuit reached its determination that

Delta would continue to operate Western as a separate

entity solely by viewing the expected status of the two

pilot work forces on the first day after the effective date

of the expected acquisition, rather than shortly there-

after when the contemplated acquisition would be com-

plete and the two pilot groups would be fully integrated.

No court has ever found an acquiring company to be a

successor of the acquired company for purposes of em-

ployment discrimination liability by ignoring the undis-

puted expected result of an acquisition and relying on

® For example, Delta presented undisputed evidence that Western’s

general offices would be closed and that Western employees in those

facilities would be offered transfer to Delta offices. C.R. 425 at 3.

Similarly, Delta presented undisputed evidence that, even if all

former Western employees who were offered jobs with Delta ac-

cepted those employment offers, former Western employees would

comprise only 23% of Delta’s work force. C.R. 428 at 2, 4. In

addition, seniority lists would be integrated to allow Western

employees to fill available vacancies in Delta’s system after the

merger such that former Western employees would be working

with Delta employees on a system-wide basis. C.R. 425 at 4; C.R.

428 at 3. Furthermore, Western employees who became Delta em-

ployees would largely work for different supervisors and many

would be employed in different job classifications and work under

different working conditions. C.R. 425 at 4, 5; C.R. 428 at 3, 4;

Tr. 13.

17

such a narrow assessment of the expected facts at an

arbitrary point along the acquisition and integration

process.

Moreover, because this Court has never addressed the

successorship doctrine in an employment discrimination

eontext, the necessary factors upon which a successor-

ship finding can be based are unclear. With its decision

in this case, the Ninth Circuit had held that the succes-

sorship determination should be made on the first day

after the effective date of the acquisition in spite of the

fact that that date is the beginning rather than the end

of a transition period. Thus, the Ninth Circuit arbitrar-

ily focused on a point that would clearly be one of tran-

sition rather than repose.

Instead, the proper focus should be on the status of

the acquiring company upon the completion of the acqui-

sition and integration rather than upon a point in time

somewhere along the way to that completion. Only then

can it be established whether the acquiring company in-

tended to maintain the business enterprise of the ac-

quired company in substantially the same manner. See,

e.g., Fall River Dyeing & Finishing Corp. v. NLRB, 107

S. Ct. 2225, 2234 (1987) (continuity established if “new

employer makes conscious decision to maintain generally

the same business”) (emphasis added). To ignore the

fact that an acquiring company intends to completely

integrate the acquired company into itself solely because

that integration will not occur immediately renders the

traditional successorship standards meaningless. Obvi-

ously, a large corporation cannot fully integrate an ac-

quired corporation into itself immediately after an ac-

quisition. It takes time to integrate separate work

forces with fairness and a minimum of disruption in the

lives of employees and their families. The continuity

factors are obviously designed to determine whether the

operation of the acquired company will survive substan-

tially intact after a post-acquisition integration, thereby

18

making it more equitable to transfer liability to the ac-

quiring company. In this decision, however, the Ninth

Circuit has created precedent in an important area of

federal law that sets the date upon which the continuity

factors should be applied at an illogical time that bears

no relation to the purpose of those factors.

Finally, to ignore the fact that, after the dust settles

on an acquisition, there will no longer be any continuity

of the acquired company’s business—-and therefore no

successorship—-merely requires relitigation when that

time comes. Such a result causes needless litigation and

expense and ignores the purpose of the continuity factors

of the successorship doctrine—to determine whether an

acquiring company will essentially continue the business

enterprise of an acquired company so that it is fair to

require it to remedy certain unremedied, unlawful prac-

tices of the acquired company.

Accordingly, because of the Ninth Circuit’s decision on

this important and unsettled question, it is imperative

that this Court settle this matter.

19

CONCLUSION

For the reasons stated above, Petitioner Delta Air

Lines, Inc. respectfully requests that this Petition For

Certiorari be granted.

Respectfully submitted,

WILLIAM H. BOICE

(Counsel of Record)

THOMAS J. MUNGER

KILPATRICK & CODY

Suite 3100

100 Peachtree Street

Atlanta, Georgia 30303

(404) 572-6500

ROBERT S. HARKEY

GREGORY L. RIGGS

LEGAL DEPARTMENT

DELTA AIR LINES, INC.

Hartsfield Atlanta

International Airport

Atlanta, Georgia 30320

(404) 765-2611

Counsel for Petitioner

APPENDIX

la

APPENDIX

Opinion of the United States Court of Appeals

for the Ninth Circuit

October 12, 1988

IN THE UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

Case No. 87-5771

CHARLES G. CRISWELL;

EUGENE R. BLACK,

Plaintiffs-Appellees,

V.

DELTA AIR LINES, INC.,

Defendant-A ppellant.

Appeal from the United States District Court

for the Central District of California

A. Wallace Tashima, District Judge, Presiding

Argued and Submitted April 14, 1988

San Francisco, California

Filed: October 12, 1988

Before: BROWNING, NELSON AND CANBY, Cir-

cuit Judges.

2a

MEMORANDUM

INTRODUCTION

This action had its genesis more than ten years ago

when pilot Charles Criswell, and two other plaintiffs,

were forced to retire at age 60 by Western Air Lines

(“Western”). A jury found that Western had violated

the Age Discrimination in Employment Act, 29 U.S.C.

§§ 621-34, when it (1) refused to allow DC-10 captains

nearing the age of sixty to down-bid to the position of

second officers (flight engineers), and (2) imposed a

mandatory retirement age of sixty on second officers as

a matter of company policy. Criswell v. Western Air

Lines, Inc., 514 F. Supp. 384 (C.D. Cal. 1981). Final

judgment and a permanent injunction were issued on

May 13, 1981 by Judge Tashima.

This court affirmed the district court’s decision. 709

F.2d 544 (9th Cir. 1983). A unanimous Supreme Court

affirmed. 472 U.S. 400 (1985).

Western was acquired by and became a wholly-owned

subsidiary of Delta Air Lines (“Delta’’) in September

1986. The merger was consummated on April 1, 1987.

After the merger, Delta refused to continue Criswell

and the fifteen other movants (“plaintiffs”) as second

officers although it did offer them unspecified ground-

level positions. Delta contends that its action was neces-

sary because of its policy prohibiting captains and first

officers from “bidding-down” and serving as second offi-

cers.

Because of this refusal to continue their employment

in cockpit positions, plaintiffs returned to Judge Tashima

and moved to have defendant Western and respondent

Delta held in contempt of court for failure to comply

with the Final Judgment and Permanent Injunction in

Criswell v. Western Air Lines. The district court granted

3a

the motion, holding that Delta is a successor to Western

and is thus bound by the Criswell injunction.

Delta argues that, for purposes of the Criswell injunc-

tion, it is not a successor to Western and can therefore

remove Criswell and the other plaintiffs from cockpit

positions. We agree with the district court’s analysis

that Delta is a successor to Western. We therefore

AFFIRM.

DISCUSSION

Successorship

In an employment discrimination action, there are

three principal factors relating to successor liability:

(1) continuity in operations and work force of the

successor and predecessor employers;

(2) notice to the successor employer of its predeces-

sor’s legal obligation; and

(3) ability of the precessor to provide adequate re-

lief directly.

Bates v. Pacific Maritime Ass’n, 744 F.2d 705, 709-10

(9th Cir. 1984) (imposing liability for a Title VII con-

sent decree on successor employer); See also Slack v.

Havens, 522 F.2d 1091, 1094-95 (9th Cir. 1975). Be

cause the origins of successor liability are equitable,

fairness is a prime consideration in its application. The

emphasis, therefore, is on the second and third factors

listed above.

[T]wo factors [notice and ability to provide relief]

are critical to the imposition of successor liability.

The successor doctrine is derived from equitable

principles, and it would be grossly unfair, except in

the most exceptional circumstances, to impose suc-

cessor liability on an innocent purchaser when the

predecessor is fully capable of providing relief or

when the successor did not have the opportunity to

protect itself...

4a

Musikiwamba v. Essi, Inc., 760 F.2d 740, 750 (7th Cir.

1985). See Bates, 744 F.2d at 710 (“These factors indi-

cate that both fairness and necessity are inherent con-

siderations in successorship analysis.’’) .

Delta’s Policies

In the present case, all of the elements for a finding

of successorship are satisfied. First, there are continuity

in operations and the work force of the successor and

predecessor employers. There was ample evidence that

during the post-merger period in question, the former

Western flight operations were not integrated into Delta

operations. Former Western personnel continued to fly

former Western equipment on former Western routes,

while Delta’s pre-merger operations continued substan-

tially unchanged. Second, Delta was on notice of West-

ern’s legal obligation; it filed an amicus brief in support

of Western in Criswell v. Western Air Lines. Third,

Western is clearly incapable of providing the relief re-

quired by the injunction; it no longer exists as a corpo-

rate entity. Delta, on the other hand, had and has the

ability to provide adequate relief. The plaintiffs all

down-bid to second officers positions while at Western;

they could obtain complete relief if Delta simply retained

them in the position they held at the time Delta acquired

Western. Delta need not change its up-or-out policy as

it applies to others in order to accord relief to plaintiffs.

Since all three of the factors affecting successor liability

weigh in favor of plaintiffs, the district court did not

err in holding Delta subject to the Western injunction.

Delta nevertheless argues that successorship liability

does not apply to the “independent” actions of an acquir-

ing company. Should plaintiffs seek to challenge these

“new” policies they can file a new action against Delta

directly. Delta’s argument ignores a basic tenet of suc-

cessorship doctrine: the obligation imposed on the suc-

cessor is preexisting. As this court noted in Bates, “[i]n

5a

successorship cases, it is necessary to distinguish between

the necessity for finding discrimination in the first in-

stance, and the enforcement of an already established

obligation against a successor employer .... Successor-

ship liability, {] rests upon the consent decree itself, not

upon some independent admission of wrongdoing.” 744

F.2d at 709. Plaintiffs are not challenging Delta’s new

policies per se; they are simply insisting on a fulfillment

of obligations owing to them because of Western’s actions

and the injunction remedying them. “[T]he disappear-

ance by merger of a corporate employer . . . does not

automatically terminate all rights of the [previous] em-

ployees . . .[;] the successor employer may [still] be

required to arbitrate with the union under the [prior]

agreement.” John Wiley & Sons, Inc. v. Livingston, 376

U.S. 548, 548 (1964). Delta may be free to execute its

own policies to other employees, but it is not free to

abrogate its predecessor’s obligations to plaintiffs under

the injunction.

Challenge to Injunctive Relief

Delta’s final argument, that petitioners must meet the

criteria for injuntive relief, is misdirected; the real issue

in this case is whether successorship liability attaches.

Because the merits of Criswell’s claims have already been

adjudicated, and because the obligation is preexisting, the

plaintiffs need not make an independent showing for in-

junctive relief. Nor need they file a new action.

That the new employer is not a party of the consent

decree is of course irrelevant, for that is the whole

point of the successorship doctrine. The questions is

whether the successorship doctrine applies and, if so,

on what rationale.

Bates, 744 F.2d at 709. Determination of successorship

is a highly fact-specific enterprise, and we find in the

record no reason to disagree with the district court’s

ieee

6a

analysis. See e.g., Howard Johnson Co., Inc. v. Detroit

Local Joint Exe. Bd., 417 U.S. 249, 256 (1974); Bates,

744 F.2d at 709. Delta is a successor to Western for

purposes of the Criswell injunction.

CONCLUSION

The judgment of the district court is affirmed. There

is a continuity of operations between the merged airlines,

Delta had notice of Western’s obligations, and Delta has

the ability to provide relief. The elements for successor-

ship are satisfied. The district court did not err in find-

ing that Delta has succeeded to the position of Western

and is therefore bound by the Criswell injunction.

AFFIRMED.

wrens sage oho

7a

Order of the United States District Court

for the Central District of California

March 30, 1987

UNITED STATES DISTRICT COURT

CENTRAL DISTRICT OF CALIFORNIA

Case No. CV-78-2184-AWT (Gx)

CHARLES G. CRISWELL,

Plaintiff,

and

EUGENE R. BLACK, ROBERT P. ELLIOT, ERNEST F.. ELLIS,

ARLIE A. GILLESPIE, PETER T. HOFFMAN, JACK L.

KEYES, BEN D. LAUBACHER, JR., ROBERT A. LONGWELL,

ALAN L. MCLAREN, PHIL G. Most, LYNN M. NORTON,

GLEN P. SHANNON, DONALD C. THOMPSON, and HENRY

J. WEIGAND, Movants,

Vv.

WESTERN AIR LINES, INC.,

Defendant,

and

DELTA AIR LINES, INC., and

AIR LINE PILOTS ASSOCIATION, INTERNATIONAL,

Respondents.

ORDER

Plaintiff Charles G. Criswell and 14 movants, all flight

officers of Western Air Lines, Inc. who are over 60 years

of age, have moved against Western and Delta Air Lines,

8a

Inc. for a citation of civil contempt and for further re-

lief for failure to obey the judgment and the injunction

in this case, entered May 18, 1981. On the basis of the

submissions before the Court and the arguments of coun-

sel, the following is ORDERED:

1. Plaintiff’s motion is granted as recited herein:

2. Delta is a successor to Western and is bound by

the Criswell injunction (attached and incorporated here-

in) with respect to the employment of plaintiff and

movants. It appears to the Court that Western’s and

Delta’s flight operations will not be fully integrated until

some time in the future. At this point, then, Delta is a

successor for the purposes of the pending motion. The

Order is limited to these 15 individuals who are being

permitted to continue their employment as Second Offi-

cers, and does not apply to those who in the future may

seek to transfer, or “down-bid” from Captain to Second

Officer at age 60 or to serve as Second Officer after age

60.

38. Delta will not suffer significant harm or hardship

because of this Order.

4. The Court considers this Order to be a final, ap-

pealable order.

5. Delta’s motion for a stay of this Order is denied.

Delta has not shown a likelihood of succeeding on the

merits on the issue of whether it is a successor to West-

ern for the purposes of the plaintiff’s and movants’ mo-

tion.

Dated: March 30, 1987

2:00 p.m.

/s/ A. Wallace Tashima

United States District Judge

9a

Approved as to form except as noted below:

Delta and Western request that the order expressly

state:

This is a final order which modifies the May 13, 1981

injunction by applying it to Delta as stated herein. The

order therefore is immediately appealable.

/s/ William H. Boice

Attorney for Defendant Western

and Respondent Delta

Plaintiff’s and movants’ response to above exception:

The Court ruled that it considered its Order to be a

final, appealable Order, The Court did not rule that it

was “modifying” the Criswell injunction and we submit

that the Court did not, in fact, modify the injunction.

/s/ Raymond C. Fay

Attorney for Plaintiff and

Movants