Petition — Lewis v. Philip Morris, Inc.
Supreme Court brief1979
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IN THER
Siyirene Court of the United He”
Oocronpn ‘Term, 1978
No. 9G = 696
Nora Lew, ef al.,
Petitioners,
Vv,
Prim Morris, [ne,, ef al.
PETITION FOR A WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
_ " — _ ——= ~ - -——— <r ee eee eee ee ee ee ee
JACK GRERNEERG
O, Perer Srerwoop
Mie Scnnappar
Suite 2080
LO Columbus Cirele
New York, New York 10019
Henny L. Manan, I
Wintiam HH, Basa, TT
Joun W, Socortr, JR,
Ranpann G, Jomnson
Hill, Tucker & Marsh
214 Kast Clay Street
Richmond, Virginia 28261
Barry L, Go.nsrerm
Suite 940
806 15th Street, NW,
Washington, D.C, 20006
Counsel for Petitioners
ee
TABLE OF CONTENTS
PAGE
Opinions Below ......ssssssssssssvessesssenssennsnnnsennsnnnns essrserers 1
Turisdletion occ eT seaneainiennalannnnanits 2
Questions Presented... 9
Statutory Provisions Involved .oooesemeessccee 3
Statement of the Case om 4
Reasons For Granting THE Warr
I. Cortiorari Should Be Granted to Resolve a Conflict
Among the Circuits Regarding the Effect of an
Interlocutory Appeal on the Jurisdiction of a Dis-
triet Court coor
tI. The Court of Appeals’ Fin “ng of Non-Diserimina-
tion Is In Conflict With Frurneo Construction
Corp, ¥. Waters, 57 L.Bd 2d O87 (1976) ...........-...-
CoNCLUBION abs ee Et cree etn
APPRNDIX-
Opinion of the District Court, July 7, 1976 ........--
Order of the District Court, September 2, 1976 ....
Order of the District Court, November 17, 1976 ....
Opinion of the Court of Appeals, May 10, 1978 ....
Order of the Court of Appeals, July 26, 1978 .......
15
20
39a
55a
57a
95a
ii
TABLE oF AUTHORITIES
Cases: PAGE
Armstrong v. O’Conmell, 416 F. Supp. 1325 (E.D. Wis.
TOTG) -ncncnncsncecescescerovecconssnsesssussnssnrsnssvenneansnsssosnosncrasenconssoceses 9
Aune v. Rynders, 344 F.2d 835 (10th Cir. 1965) ...........- 8,13
Babcock & Wilcox v. Foster Wheeler Corp., 54 F.R.D.
ATA (D.N.J. 1971) ..22.--2-020-ceceeeecosnsncsnseenssnensnssarecsnsnencnsnseners 9
Carpenter Brothers, Inc. v. Duval Sales Corp., 440
F. Supp. 1150 (E.D. Wis. REED snnsnctnuncnterescotomiatasnsnesen . 9
Casteneda v. Partida, 430 U.S. 482 (1977) .....-.-------+ 17
Champlin Ref. Co. v. Corporation Commission, 286
TIS. 210 (1932) 0....-..n.csserececscererencecnsennsnssssnsncnsscnssensnserss 12
Chicago Housing Tenants Organization v. Chicago
Housing Authority, 512 F.2d 19 (7th Cir. 1975) ........ 7
Control Data Corp. v. International Business Machine
Corp., 421 F.2d 323 (8th Cir. I csciicrarvonssonssancconsonn 7
Dempsey v. Guaranty Trust Co., 131 F.2d 103 (7th
Cir. 1942)
De Pinto v. Provident Security Life Insurance Co., 374
F.2d 50 (9th Cir. 1967) ............--ccecceceeseeseeeeessesnensnenneneens 7
District 2, Marine Engineers v. Falcon Carriers, 374
F. Supp. 1342 (S.D.N.Y. 1974) ..---------csseesseessesenseeseens 9, 10
East Carroll Parish v. Marshall, 424 U.S. 636
(1976) ....esecccocecocesesecosesorssecnsesnsesssssssorsnenacecererssnsnsssosecees 7,12,13
F.E.0.C. v. Locals 14 and 15, 1.U.0.F., 438 F. Supp.
876 (S.D.N.Y. 1977) ...-..--:-c-cccceceseseesesssscsensnesenssnsennsnsnenees 9
Environmental Defense Fund, Inc. v. Froehlke, 348
F. Supp. 638 (W.D. Mo. 1970) =. seiadsdigslapasaasdnaanichiennieineaaeal 9
ill
PAGE
Ferquson v. Tabah, 288 F.2d 665 (2d Cir. 1961) -.....------ 8
Fernow v. Liberty Royalties Corp., 146 F.2d 396 (10th
Civ, 1944) ...nnonoesencssncecnescvssorscennsensensesnnesnsssnnconosonsennssraseneeer® 8
Foote v. Parsons Non-Skid Co., 196 F. 951 (6th Cir.
ROS ec decsoncinnsteiserssrnsscnbednrstnnnsnernnncnccttcinesnesrennet Fr 7
Furnco Construction Corp. V. Waters, 57 L.Ed.2d 957
(1978) ...n...c--nsnecnsesnscnsssnnsnsnsessnensenensoee ie adianipinaiee 15, 17, 18, 20
Hamer v. Campbell, 358 F.2d 215 (5th Cir. 1966) ........ 8
Hawkins v. Lindsley, 327 F.2d 356 (2d Cir. 1964) .....--- 11
Hazelwood School District v. United States, 433 U.S.
DOD (1977) ..u.---n-necesresescccncensnsnssncenensnennensnee oe aerecnmaetins 18
Hoffman, ete. v. Beer Drivers & Salesmen’s, etc., 536
F.2d 1268 (9th Cir. 1976) ......------------csssreesenrseeerrenrenetee Fe
Human Resources Management v. Weaver, 422 F.
Supp. 241 (D.D.C. 1978) ....2---:---cnscvesssensensenesesensconennnnnes i)
Ideal Toy Corp. v. Sayco Doll Corp., 302 F.2d 623 (2d
Cir. 1962) .....-... __ccassvsrdnasanssannennantugaiohnansetonsnidasssesaniets 8, 10
In re Woodruff, 121 F.2d 152 (9th Cir. 1941) ......-.------ 7
Jaqgoy. United States District Court, 570 F.2d 618 (6th
Cie, UGTB) ..cccnenenccciscesorecsesossesronenssnsnnecnmnsasnssonnnannransnessnannenes 7,10
JTanousek v. Doyle, 313 F.2d 916 (8th Cir. 1963) ..........-- 7
L.A. Conerete Pumping Vv. Majich, 18 Fed. Rules Serv.
Dd 45 (C.D. Cal. 1978) .....-------:--scscesenserssnssnssesensessnasensnnee 9
Macon v. Bailar, 428 F. Supp. 182 (E.D. Va. 1977) ... 9
MeLeod vy. National Maritime Union, 329 F. Supp. 151
(S.D.N.Y. 1971) -..----0--20:20 tao cascada 13
Morning Telegraph v. Powers, 450 F.2d 97 (2d Cir.
BOT) oaccovisiascnnsonnnsconesecosnssnnunnssionnssinoensonntmeannseccanaaneannaee eee
iv
PAGE
Nalco Chemical Co, v. Hall, 347 F.2d 90 (5th Cir. 1965) 8
O’Brien v. Avco Corp., 309 F. Supp. 703 (S.D.N.Y.
RE cocencnscsinriilicachratsNlnadanatiigsdoaniaicaea ain es eee 9,10
Pacific Telephone and Telegraph Co. v. Kuykendall,
BOO TW TOD CHRDOD sisstncnckcantocnnnunaaaenn 12
Petuskey v. Rampion, 431 F.2d 378 (10th Cir. 1970) ....8, 11
Pettway v. Amertcan Cast Tron Pipe Co., 411 F.2d 998
(Oth br. SOI)» = ncismcid Ged actaaiomanene 7
Phelan vy. Taitano, 233 F.2d 117 (9th Cir. 1956) ........ 7
Plaquemines Parish Commission Council vy. United
States, 416 F.2d 952 (5th Cir. 1969) ooo. 8
Ruby v. Pan American World Airways, Inc., 360 F.2d
Ge (OR Cle. BI iced dee eee 8,11
SCRAP vy. United States, 353 F. Supp. 317 (D.D.C.
RINW IE D . .nccsiericivbsuinisomiennsonisaneeninacmarcamena ae 9
S.E.C. v. Okin, 137 F.2d 862 (2d Cir. 1943) 200. 8,11
Shaffer v. Carter, 252 U.S. 37 (1920) oecccecccecccceeceseeee. 12
Smith v. American Shipbuilding, 22 Fed, Rules Serv.
aa G08 CL.D. Obie 1000) 2 9
Smith v. Illinois Bell Telephone Co., 270 U.S. 587
GUID sssenscsncrovsciesicecinmicandicesoesheasisiaiiasiseltaia eae n 12
A.O. Smith Corp. v. F.T.C., 396 F. Supp. 1125 (D. Del.
TN sects secinchelpasibaciaaia ears 9
Society for Animal Rights, Ine. v. Schlesinger, 512 F.2d
LE LGR: Rh) | cme Roeper ne ewe Tote 7
Standard Oil Company v. United States, 429 U.S, 17
femme SNARE EIR TIA Ee ce o> 13
State of New York v. Nuclear Reg. Com’n, 550 F.2d 745
iE : | Seman bn R rae AORTA | Me. = aot NE 8,10
Stell v. Savannah-Chatham County Board of Ed., 333
F.2d 26 (Sth Cir. 1963) o.oo... ee ceccscssesees ssdenaneeaetads 8
PAGE
Sterling v. Constantin, 287 U.S. Bs (3008) «.................. 12
Turner v. HMH Publishing Co., 328 F.2d 136 (5th Cir.
TOGA) nna nanan aa naan esn nnn ensncnnnnnennneenenensenenensoenensenenes 7,43
United States v. Articles of Food and Drug, 444
F. Supp. 266 (E.D. Wise. 1978)... 9
United States v. Board of School Commissioners of
Indianapolis, 503 F.2d 68 (7th Cir. | eee 7
United States v. City of Chicago, 549 F.2d 415 (7th
a TI nanan an nnn nanan nnnn nnn nnneennennenennnennen 1,9
United States v. City of Chicago, 534 F.2d 708 (7th
naan cnn nnn nena n nnn nanan nneen nen 7
Tnited States v. City of Chicago, 411 F. Supp. 218
(N.D. TUL. 1976) -....--.--.--------------0-20rseesnesoeecensectensenteneeneene 7,9
United States v. Onan, 190 F.2d 1 (8th > 2) ae 7
Van Hoomissen v. Xerox Corp., 368 F. Supp. 829 (N.D.
Cal. 1973) ........ noha cp ctacsesdoncieanrementinenpntines 9
Western Electric Co. v. Cinema Supplies, Inc., 80 F.2d
111 (Sth Cir. 1935) -........--.----------------reeeeeereteeette 7,10
Zimmer v. McKeithen, 467 F.2d 1381 (5th Cir. 1972) ..7,12
Statutes:
DB U.S.C. § 1254(1) .....--.-.-----------c-c-enneneensneeeseecteeceeseseenesenes 2
98 U.S.C. § 1292(a)(1) -....---- Sa SS aa ae eM 2, 3, 5, 6,9
98 U.8.C. $1292(b) -.....-..---.---- EES anh ak no Oe janie 7
QB U.S.C. § 1343(3B) -...------------------cee-nenenecnsercnscseeceneneseenenenees 4
99 VBC. $151 —.......-...-..-.--.------------------0---re-nenn-nonenenenenner eens 4
AD B.C. $196) .............-.----------------------0-n-nennenenenenennneenen eens 4
AD TS.C. § 20000-2( a) -..-------------nenesenesceeeeseeeceeeceeeeseceenennees 3, 4
vi
’ PAGE
Other Authorities:
Barron and Holtzoff, Federal Practice and Procedure,
esr CLM. Sea oie Sere Ain oc eee SAT OT MI 10
7 Moore, Federal Practice, § 60.30[2] 10
9 Moore, Federal Practice, $203.11... 10
C. Wright, et al., Federal Practice and Procedure, v. 16,
§ 3921
IN THE
Supreme Court of the United States
Ocroser TreRM, 1978
Nora Lewis, et al.,
Petitioners,
Ve
Puuip Morris, Inc., et al.
PETITION FOR A WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
Petitioners Nora Lewis, et al., respectfully pray that a
Writ of Certiorari issue to review the judgment and opinion
of the United States Court of Appeals for the Fourth Cir-
cuit entered in this proceeding on May 10, 1978.
Opinions Below
The July 7, 1976, opinion of the district court is reported
at 419 F.Supp. 345 and is set out in the Appendix hereto,
pp. la-38a. The order of the district court of September 2,
1976, which is not officially reported, is reprinted at 13 EPD
711,350, and is set out in the Appendix hereto, pp. 39a-4a.
The order of the district court of November 17, 1976, which
is not officially reported, is set out in the Appendix hereto,
pp. 55a-56a. The May 10, 1978, opinion of the court of ap-
peals is reported at 577 F.2d 1135, and is set out in the
2
Appendix hereto, pp. 57a-96a. The J uly 26, 1978, order of
the court of appeals denying rehearing and rehearing en
bane, which is not officially reported, is set out in the Appen-
dix hereto, p. 95a.
Jurisdiction
The judgment of the court of appeals was entered on
May 10, 1978. Petitioners filed a timely Petition for Re-
hearing and Rehearing En Bane, which was denied on July
26, 1978. This Court has jurisdiction under 28 U.S.C.
§ 1254(1).
Questions Presented
1. Does the filing of an interlocutory appeal’ under 28
U.S.C. ¢1292(a)(1) divest a district court of jurisdiction
over part or all of the action involved?
2. Did the court of appeals err in directing the dis-
missal of plaintiffs’ claim of unlawful racial discrimi-
nation in employment, where both courts below found there
was an unrebutted prima facie case of discrimination and
the record showed, inter alia, that from 1965 to 1971 the
defendant company had assigned newly hired workers
among its departments in the following manner:
* Petitioners maintained below that the order which was the
subject of the attempted interlocutory appeal in this ease did not
was proper.
3
Ware- Pre-
Fabrication house Fabrication Stemmery Total
White
Employees 75% (3602) 7% (313) 5% (251) 13% (624) 100% (4793)
Black
Employees 30% (1052) 1% (40) 8% (287) 61% (2133) 100% (3512)
Statutory Provisions Involved
Section 703 of Title VII of the Civil Rights Act of 1964
(42 U.S.C. § 2000e-2(a) ) provides :
(a) It shall be an unlawful employment practice for an
employer—
(1) to fail or refuse to hire or to discharge any in-
dividual, or otherwise to discriminate against
any individual with respect to his compensation,
terms, conditions, or privileges of employment,
because of such individual’s race, color, religion,
sex, or national origin; or
(2) to limit, segregate, or classify his employees or
applicants for employment in any way which
would deprive or tend to deprive any individual
of employment opportunities or otherwise ad-
versely affect his status as an employee, because
of such individual’s race, color, religion, sex, or
national origin.
Section 1292(a), 28 U.S.C., provides in pertinent part:
(a) The court of appeals shall have jurisdiction of ap-
peals from:
(1) Inierloeutory orders of the district courts of the
United States, the United States District Court
for the District of the Canal Zone, the District
Court of Guam, and the District Court of the
4
Virgin Islands, or of the judges thereof, grant-
ing, continuing, modifying, refusing or dissolv-
ing injunctions, or refusing to dissolve or modify
injunctions, except where a direct review may
be had in the Supreme Court.
Statement of the Case
Five black female employees brought this action on Sep-
tember 9, 1973, in the United States District Court for the
Eastern District of Virginia, alleging that they were the
victims of discrimination in employment on the basis of
race and sex by Philip Morris, Incorporated, the Tobacco
Workers’ International Union, and its Local 203. Plaintiffs
alleged that the discrimination violated Title VII of the
Civil Rights Act of 1964, 42 U.S.C. §§ 2000e et seq., 42 U.S.C.
§ 1981, and 29 U.S.C. § 151. Jurisdiction was asserted, inter
alia, under 28 U.S.C. § 1343(3).
The district court certified the case as a class action on
October 7, 1974, and defined the class to include all blacks
and women who had been employed in the company’s stem-
mery on or after July 2, 1965, the effective date of Title
VII. Certain issues were resolved by a consent decree en-
tered on June 6, 1975.
The case was tried in April of 1975. Plaintiffs offered
evidence of a number of different discriminatory practices,
the most important of which was an alleged practice of
assigning most newly hired blacks to two traditionally black
departments in its Richmond operations, pre-fabrication
and the stemmery, assigning most newly hired whites to two
traditionally white departments, fabrication and ware-
house, and excluding newly hired female employees from
the pre-fabrication and warehouse departments, On July 7,
1976, the district court entered a Memorandum Opinion and
9)
Order holding the company and both unions liable for dis-
crimination on the basis of race and sex. App. ta-38a. The
parties were directed to file briefs on the appropriate
method of framing and implementing relief. App. 38a.
On September 2, 1976, the district court entered an order
“adopting plaintiffs’ back pay and injunetive relief guide-
lines.” App. 39a-57a. These Guidelines had been proposed
by plaintiffs to set standards for identifying victims of dis-
crimination, for calculating back pay, and for framing a
detailed injunctive decree. The court’s order provided that
“Tajll Stage IT [remedy] proceedings shall be governed by
and consistent with these guidelines.” App. 40a.
On September 14, 1976, the defendant unions moved for
reconsideration of the Guidelines, a request that was later
joined in by the company. On September 29, 1976, while the
motion for reconsideration was still pending, the defen-
dants, apparently concerned that the Guidelines themselves
constituted an injunction and that the 30 days for an inter-
locutory appeal were about to end, filed a notice of appeal.
On November 17, 1976, the district court granted the motion
for reconsideration and vacated its previous order adopting
the Guidelines. App. 50a.
In the court of appeals, however, the company and unions
contended that the district court lost jurisdiction to grant
their pending motion for reconsideration when they filed
their notice of appeal pursuant to 28 U.S.C. § 1292(a) (1).
The court of appeals on May 10, 1978, held that the district
court did lack jurisdiction to vacate its September 2, 1976,
order, that the Guidelines were thus still in effect, and that
the Guidelines contained provisions which were injunctions
appealable under § 1292(a) (1). App. 63a-69a. The court
of appeals therefore proceeded to reach the merits of the
appeal; it reversed the finding of racial discrimination,
6
directed that that claim be dismissed, and vacated and
remanded the finding of discrimination on the basis of sex,
App. 72a-96a, The court of appeals noted that the defen-
dants had asserted unsuccessfully in the district court that
certain aspects of this case were foreclosed as res judicata,
but did not reach that issue itself. App. 70a-72a.
On June 5, 1978, petitioners filed a timely Petition for
Rehearing and Suggestion for Rehearing En Bane. The
court of appeals denied that Petition on July 26, 1978.
REASONS FOR GRANTING THE WRIT
I.
Certiorari Should Be Granted to Resolve a Conflict
Among the Circuits Regarding the Effect of an Inter-
locutory Appeal on the Jurisdiction of a District Court.
Although 42 U.S.C. § 1292(a)(1) authorizes interlocutory
appeals from any order granting or denying an injunction,
it does not expressly indicate the effect, if any, of such an
interlocutory appeal on the continued jurisdiction of the
district court which granted or denied that injunction. The
effect of such an appeal on the jurisdiction of the district
courts is a matter of substantial importance, since a sub-
stantial number of appeals are taken each year under sec-
tion 1292(a)(1).°
*On May 19, 1978, the court of appeals extended the time for
filing a Petition for rehearing.
*The Administrative Office of the United States Courts does
not collect statistics on these appeals. An informal survey of re-
cently published appellate decisions indicates that the number
fe 1292(a)(1) appeals each year is in the order of magnitude of
7
A serious conflict exists among the cireuits on this issue,
The Sixth,! Seventh,® Kighth,' and District of Columbia’
circuits have held that the taking of such an interlocutory
appeal in no way affects the jurisdiction of the district
court. The Ninth Cireuit rule is that the district court loses
jurisdiction as to the matter involved in the appeal, but
may modify the order appealed from or take other action
based on new developments.’ The Fifth’? Cireuit has con-
4 Jago v. United States District Court, 570 F.2d 618, 622-23 (6th
Cir, 1978); Foote v. Parsons Non-Skid Co., 196 F. 951, 954 (6th
Cir. 1912).
5 United States v. City of Chicago, 549 F.2d 415 (7th Cir. 1977),
aff'g 411 F. Supp. 218, 946-47 (N.D. Ill. 1976); United States v.
City of Chicago, 534 F 2d 708, 711 (7th Cir. 1976) ; Chicago Hous-
ing Tenants Organization v. Chicago Housing Authority, 512 F.2d
19, 22 (7th Cir. 1975) ; United States v. Board of School Com-
missioners of Indianapolis, 503 F.2d 68, 81-82 (7th Cir. 1974);
Dempsey v. Guaranty Trust Co., 131 F.2d 103, 105 (7th Cir. 1942).
6 Janousck v. Doyle, 313 F.2d 916, 920-22 (8th Cir. 1963) ;
Inited States v. Onan, 190 F.2d 1, 8 (8th Cir. 1951); Western
Electric Co. v. Cinema Supplies, Inc., 80 F.2d 111, 112 (8th Cir.
1935) ; ef. Control Data Corp. V. International Business Machine
Corp., 421 F.2d 323, 325 (8th Cir. 1970) (an interlocutory appeal
pending under 28 U.S.C. § 1292(b) when the district court dis-
missed part of the complaint). Janousek is the leading appellate
case on this issue.
7 Society For Animal Rights, Inc. v. Schlesinger, 512 F.2d 915,
918 (D.C. Cir. 1975).
’ Hoffman, ete. v. Beer Drivers & Salesmen’s etc., 5386 F.2d 1268,
1276 (9th Cir. 1976); DePinto Vv. Provident Security Life In-
surance Co., 374 F.2d 50, 51, n2 (9th Cir. 1967) ; Phelan v. Tav-
tano, 233 F.2d 117, 119 (9th Cir. 1956) ; In re Woodruff, 121 F.2d
152, 153-54 (9th Cir. 1941).
‘This is the position taken in the most recent Fifth Circuit deci-
sion. Zimmer v. McKeithen, 467 F.2d 1381, 1382 (5th Cir. 1972)
rev'd 485 F.2d 1297 (5th Cir. 1973) (en bane), aff'd sub nom.
East Carroll Parish v. Marshall, 424 U.S. 636 (1976); see
also Turner v. HMH Publishing Co., 328 F.2d 136, 137 (5th
Cir. 1964). Pettway v. Amertcan Cast Iron Pipe Co., 411
F.2d 998, 1003, n.8 (5th Cir. 1969) held more broadly that juris-
diction was lost over “those matters involved in the appeal.” But
earlier Fifth Circuit opinions had followed the majority view that
8
luder at such an appeal divests the district court of juris.
diction t= odify or vacate the order being appealed, except
to stay us operation pending appeal, The Tenth Cireuit!
has adopted a more restrictive rule, which divests the dis.
trict court of all jurisdiction over the case during the pen.
dency of the interlocutory appeal. The Second Circuit is
divided on this question; since 1961 panels of that circuit
have held that the district court loses jurisdiction to modify
the order being appealed," does not lose such jurisdiction,”
may modify the order if it thinks it incorrect but not based
on new evidence,"* and may moot the interlocutory appeal
by trying the case on the merits and entering a final injune-
tion.* The Fourth Cirenit decision in the instant case holds
that the district court lost jurisdiction to vacate its order
of September 2, 1976, once that order was made the subject
the district court’s jurisdiction is not affected by the pendency of
an interlocutory appeal. Plaquemines Parish Commission Council
v. United States, 416 F.2d 952, 954 (5th Cir. 1969): Hamer vy.
Campbell, 358 F.2d 215, 223 (5th Cir. 1966) ; Nalco Chemical Co.
Vv. Hall, 347 F.2d 90, 92 (5th Cir. 1965); Stell v. Savannah-
Chatham County Board of Ed., 333 F2a 55, 60 (5th Cir. 1964)
(approves district court order “which inyolves the same question”
as that on appeal) ; see also United States v. Lynd, 321 F.2d 26, 28,
n.l (5th Cir. 1963).
1° Petuskey v. Rampton, 431 F.2d 378, 381 (10th Cir. 1970),
relying on Aune v. Rynders, 344 F.2d 835, 841 (10th Cir. 1965).
Aune, a bankruptey decision, appears to be inconsistent with an
earlier Tenth Cireuit decision in Fernow v. Liberty Royalties Corp.,
146 F.2d 396, 397 (10th Cir. 1944).
"' Morning Telegraph v. Powers, 450 F.2d 97, 99 (2d Cir. 1971) :
Ideal Toy Corp. v. Sayco Doll Corp., 302 F.2d 623, 625 (2d Cir.
1962).
® Ferguson v. Tabah, 288 F.2d 665, 675 (2d Cir. 1961).
™ State of New York v. Nuclear Reg. Com’n, 550 F.2d 745, 758-
59, n.7 (2d Cir. 1977).
'™ Ruby v. Pan American World Airways, Inc., 360 F.2d 690.
691-92 (2d Cir. 1966); see also S.E.C. v. Okin, 137 F.2d 862, 863
(2d Cir. 1943).
9
of a section 1292(a)(1) appeal, App. 65a-67a; whether the
Fourth Cireuit has adopted the broad prohibition of the
Tenth Cireuit, or only the rule of the Fifth Cireuit and
some Second Cireuit panels barring modification of the
order appealed from, is unclear,
The numerous district court decisions on this issue are
similarly divided. Nine opinions hold that the jurisdiction
of a district court is not affected by the pendency of an
interlocutory appeal.’® Two decisions adopt the Fifth and
Second Cireuits’ “same order” rule.’* Five courts follow
the Ninth Cireuit rule regarding “matters involved in the
appeal,”’? but the district courts are in disagreement as to
the meaning of the standard.’ The opinions of these district
courts bear no consistent relation to the appellate decisions
15 Human Resources Management v. Weaver, 422 F. Supp. 241
(D.D.C. 1978) ; Carpenter Brothers, Inc. v. Duval Sales Corp., 440
F. Supp. 1150, 1151 (E.D. Wis. 1977); Macon v. Bailar, 428 F
Supp. 182, 183-87 (E.D. Va. 1977); United States v. City of Chi-
cago, 411 F. Supp. 218, 247 (N.D. Ill. 1976), afd 549 F.2d 415
(7th Cir. 1977); A.O. Smith Corp. v. F.T.C., 396 F. Supp. 1125,
1137-38. n. 8 (D. Del. 1975); District 2, Marine Engineers v. Fal
con Carriers, 374 F. Supp. 1342, 1345 (S.D.N.Y. 1974) ; SCRAP vy.
United States, 353 F. Supp. 317; 320, n.2 (D.D.C. 1973). rev'd on
other grounds 412 U.S. 669 (1973); L.A. Concrete Pumping Vv.
Majich, 18 Fed. Rules Serv. 2d 45, 47-48 (C.D. Cal. 1973) ; O’Brien
v. Aveo Corp., 309 F. Supp. 703, 705 (S.D.N.Y. 1969).
16 Smith v. American Shipbuilding, 22 Fed. Rules Serv. 2d 538,
539 (N.D. Ohio 1976); Environmental Defense Fund, Ine. v.
Frochlke, 348 F. Supp. 338, 366 (W.D. Mo. 1972).
17 ['nited States v. Articles of Food and Drug, 444 F. Supp. 266,
975 (E.D. Wise. 1978): E.E.0.C. v. Locals 14 and 15, 1.V.0.E.,
138 F. Supp. 876, 880 (S.D.N.Y. 1977); Armstrong v. O'Connell,
116 F. Supp. 1325, 1329 (E.D. Wis. 1976); Van Hoomaissen v.
Nvror Corp., 368 F. Supp. 829, 831, n. 1 (N.D. Cal. 1973); Bab-
cock & Wileor Co. v. Foster Wheeler Corp., 54 F.R.D. 474, 476
D.N.J. 1971).
'S('ompare Armstrong v. O'Connell, supra, n. 17, with United
Niatcs v. Articles of Food and Drug, supra, n. 17.
10
in the circuits where they are located.'* Leading commen-
tators are also divided on this issue.*°
Although this issue arises under varying circumstances,
the conflict exists even when those differences are taken into
account. The instant decision, the Fifth Cireuit,*’ and two
panels of the Second Cireuit,”* squarely hold a district court
cannot modify an order which is the subject of a pending
interlocutory appeal; such modifications have been express-
ly upheld by decisions in the Seventh,** Eighth,** and
Ninth® cireuits. If such a modification is sought, the Second
Cireuit holds that new evidence may not be considered®*® but
19 District courts have adopted the “matter involved in the ap-
peal” rule in the Second and Seventh Circuits, although the ap-
pellate decisions in those circuits approve different standards. None
of the district court decisions in New York rely on Second Circuit
decisions; although the conflicting decisions of that circuit take a
generally restrictive view of the scope of district court jurisdiction,
District 2, Marine Engineers and O’Brien rely on more liberal
Eighth and Ninth Cireuit decisions in holding their jurisdiction is
not affected by the pendency of an interlocutory appeal.
2°'The most detailed discussion is in C, Wright, et al., Federal
Practice and Procedure, v. 16, § 3921, pp. 25-28. Professor Wright
expressly disapproves the “same order” rule. /d., p. 28. See also
Barron and Holtzoff, Federal Practice and Procedure, v. 3A, 1971
Pocket Part, § 1558, p. 33. Professor Moore apparently suggests
the “same order” rule in the text of 9 Moore, Federal Practice.
{ 203.11, p. 738, but suggests in the 1977-78 Supplement use of the
“matter involved in the appeal” standard. This may be based, how-
ever, on Moore's approval of the now discredited appellate leave
procedure. 7 Moore, Federal Practice, { 60.30[2], p. 429, n. 27.
*1 See note 9, supra.
22 See note 11, supra.
23 Dempsey v. Guaranty Trust Co., supra n. 5.
24 Western Electric Co. v. Cinema Supplies, supra n. 6.
26 Hoffman, ete. v. Beer Drivers and Salesmen’s etc., supra n. 8;
see also Jago v. United States District Court, supra n. 4.
26 Ideal Toy Corp. v. Sayco Doll Corp., supra n. 11; State of
New York v. Nuclear Reg. Com’n, supra n. 13.
11
the Ninth Circuit holds that it may.*’ If, while a prelim-
inary injunction is awaiting review in the court of appeals,
the district court conducts a trial on the merits and enters
a permanent injunction, the Tenth Circuit will overturn the
permanent injunction on the ground the district court lacked
jurisdiction to enter it,** but the Second Circuit will dismiss
as moot the appeal of the preliminary injunction and con-
sider only the appeal of the permanent injunction.*® If,
after a district court has granted or denied an injunction, a
party moves for reconsideration but then appeals before
the motion is ruled on, a district court can decide the mo-
tion in the Second Cireuit®® but not in the Fourth or Fifth.”
These conflicts reflect disagreement among the lower
courts as to the meaning and vitality of decisions of this
Court. Most of the lower court opinions holding that dis-
trict court jurisdiction is unaffected by the pendency of an
interlocutory appeal rely on this Court’s decision in Fa
parte National Enameling & Stamping Co., 201 U.S. 156
(1906). National Enameling held, with regard to the statute
authorizing interlocutory appeals:
Obviously that which is contemplated is a review of
the interlocutory order, and of that only. It was not
intended that the cause as a whole should be trans-
ferred to the appellate court prior to the final decree.
The case, except for the hearing on the appeal from the
interlocutory order, is to proceed in the lower court as
though no such appeal had been taken, unless otherwise
specially ordered. 201 U.S. at 162.
27 Hoffman, ete. v. Beer Drivers & Salesmen’s etc., supra n. 8.
28 Petuskey v. Rampton, supra n. 10.
° Ruby v. Pan American Airways, Inc., supra n. 14: S.E.C. v.
Okin, supra n. 14.
10 ¢
See Hawkins v. Lindsley, 327 F.2d 356, 359 (2d Cir, 1964)
Turner v. HMH Publishing Co., supra note 9
12
Consistent with this view, this Court has repeatedly held
that a district court may enter a final injunction during the
pendency of an interlocutory appeal from a preliminary in-
junction, and that if it does so the interlocutory appeal will
be dismissed.**
The Fourth Circuit in this case, however, concluded that
a different rule was established by East Carroll Parish
School Board v. Marshall, 424 U.S. 636 (1976). In that case
the district court had entered on August 2, 1971, a final
injunction fully disposing of the case, and an appeal was
duly taken; seven months later, while that appeal was still
pending, the district court, on the motion of one of the
parties, vacated its order of August 2, 1971 and entered a
different injunction. The Fifth Cireuit held the district
court was “without jurisdiction” to enter the new order.™
In this Court the district court’s authority to enter the
second injunction was briefed,** but the Court did not have
to reach that issue since it concluded that the original in-
junction violated clearly established constitutional prin-
ciples. 424 U.S. at 689. The Court’s opinion explained in a
footnote the procedural history of the case:
During pendency of the appeal in the court below,
the District Court purported to withdraw its order
approving the at-large plan and to substitute in its
stead a complex redistricting plan submitted by inter-
venor Marshall. The Court of Appeals vacated the
order on the ground that when the appeal was filed,
8? Sterling v. Constantin, 287 U.S. 378, 386 (1932); Champlin
Ref. Co. v. Corporation Commission, 286 U.S. 210, 224 (1932) ;
Smith v. Iilinois Bell Telephone Co., 270 U.S, 587, 589 (1926) ;
Pacific Telephone and Telegraph Co. v. Kuykendall, 265 U.S. 196,
205 (1924); Shaffer v. Carter, 252 U.S. 37, 44 (1920).
33 Zimmer Vv. McKeithen, 467 F.2d 1381, 1382 (Sth Cir. 1972).
* Brief for Respondent, No. 73-861, pp. 27-30
13
the District Court lost jurisdiction over the case. 424
U.S. at 638, n.4.
The Fourth Circuit in the instant case held that this foot-
note approved the action of the Fifth Cireuit and was in-
tended to “at least tacitly acknowledg(e] that a district
court loses jurisdiction to amend or vacate its order after
the notice of appeal had been filed... .” App. 66a.
We submit that the issue in East Carroll was whether a
district court ean modify a final judgment when it is pend-
ing on appeal, and that even that issue was not there de-
cided by this Court. Any decision that a district court
could not modify an injunction that was pending on appeal
would be inconsistent with this Court’s decision, seven
months after East Carroll, in Standard Oil Company v.
United States, 429 U.S. 17 (1976). Standard Ou held that,
even where a case had been decided on appeal, the district
court had the authority to modify on the ground of “pos-
sible later events” the judgment directed by the mandate
of the appellate court. 429 U.S. at 18-19. Certainly the
district court should have the same authority to modify its
own orders prior to an appellate decision; the contrary
rule would require a court of appeals to pass on the correct-
ness of an order which faced inevitable modification on
remand and would thus waste “the increasingly scarce time
of the federal appellate courts.” 429 U.S. at 19. Several
decisions which hold that an interlocutory appeal ousts the
district court of some or all of its jurisdiction suggest that
the solution is for the party seeking district court action
first to obtain leave to do so in the court of appeals ;*° that
is precisely the cumbersome procedure disapproved in
Standard Oil.
35 Aune v. Rynders, supra n. 10; MeLeod y. National Maritime
Union, 329 F. Supp. 151, 159-60 (S.D.N.Y. 1971).
14
The unworkability of the rule adopted by the Fourth,
Fifth and Tenth Circuits is well illustrated by the circum-
stances of this case. On September 2, 1976, the district
court adopted plaintiffs’ proposed Guidelines for the fash-
ioning of monetary and injunctive relief. On September 14,
1976, the defendant unions filed a motion for reconsidera-
tion of the September 2 order. On October 20, 1976, the
defendant company renewed its earlier unsuccessful request
for an evidentiary hearing on the Guidelines, a request
which was also directed at obtaining a change or vacation
of the September 2 order. In the meanwhile, however,
apparently concerned that the 30-day time period for ap-
pealing an injunction was about to expire, the parties had
on September 29 filed notices of appeal from the September
2 Guidelines. When these two motions were argued on
November 3, 1976, the district court expressed “second
thoughts on the guidelines” but had doubts as to whether
it had jurisdiction to alter them.** Counsel for the defen-
dant company urged the district court to vacate the Guide-
lines, arguing “this Court probably would have an inherent
power to review determinations which it has made, even
those which have led to an immediate appeal,” 7 and as-
sured the court that, if the Guidelines were vacated or
stayed, “we would probably withdraw our appeal.” °° Per-
suaded by these assertions the district court on November
17, 1976, did vacate its September 2 order. Counsel for the
company, however, changed its mind, and successfully
urged in the court of appeals that the district judge lacked
jurisdiction to grant the defendants’ motions.
°° Transcript of Proceedings of November 3. 1976, pp. 22, 27,
29, 32.
87 Td. p. 27.
38 Td. p. 33.
15
At the least the Fourth Circuit rule strips a district court
of its usual power to reconsider and modify its orders dur-
ing the course of a case whenever a party takes an inter-
locutory appeal under section 1292(a)(1). In a case such
as this the searce resources of the federal appellate courts
are thus lavished on matters no longer in controversy, since
the defendants oppose the Guidelines, the district court
wishes to withdraw them, and plaintiffs do not seek to
appeal that withdrawal. Under the broader rule adopted
by the Tenth Circuit the granting of preliminary injunctive
relief, if followed by an interlocutory appeal, precludes the
district court from even going forward with the merits of
the case. Such results are clearly inconsistent with the
efficient administration of justice. Certiorari should be
granted to resolve this conflict and to reaffirm the rule in
Ex parte National Enameling.
Il.
The Court of Appeals’ Finding of Non-Discrimination
Is In Conflict With Furnco Construction Corp. v. Waters,
57 L.Ed. 2d 957 (1978).
The central substantive issue in this compelx employment
discrimination case is whether the defendant company as-
signed newly hired employees on the basis of race and sex.
The company conceded that prior to 1965 workers were
employed “on a segregated basis” ** and the district court
so found. App. 22a. As a result, in 1965 the company em-
ployees were distributed among the company’s four depart-
ments in the following manner:
39 Court of Appeals Appendix (hereinafter cited as “Appendix”’)
p. 63. The union conceded this as well. Id. p. 86.
White Male
Black Male
Black Female
16
Total Workforce: 1965*°
Ware- Pre-
Fabrication house Fabrication Stemmery Total
84% 3% 7% 4% 100%
White Female 94% 0% 1% 5% 100%
26% 4% 60% 10% 100%
34% 0% 27% 39% 100%
Between 1965 and 1971 new employees were assigned in a
manner which mirrored*’ the pattern of discrimination
which had grown up prior to the adoption of the 1964 Civil
Rights Act:
Assignment of New Employees: 1965-1971.*
Ware- Pre-
Fabrication house Fabrication Stemmery Total
White
Male 71% (2584) 9% (818) 7% (251) 18% (461) 100% (3609)
White
Female 86% (1018) 0% (0) 1% (3) 14% (163) 100% (1184)
Black
Male 29% (790) 1% (40) 11% (287) 59% (1604) 100% (2721)
Black
Female 33% (262) 0% (0) 0% (0) 67% (529) 100%
All of these assignments were made by the company’s Assis-
tant Personnel Manager.** Because of the large number
of employees involved in these assignments, tne odds
against such a pattern of assignments occurring by chance
‘9 Id, pp. 496-501.
‘! The most important change is a substantial increase in the
proportion of black males assigned to work in the stemmery, the
worst job in the company.
42 Td., pp. 588-591. The E.E.O.C. charges on which the Title VII
claim is grounded date from March, 1970. App. 9a.
43 Appendix pp. 687-88. Two people, both white males, held this
position between 1965 and 1971.
17
were overwhelming. The number of blacks assigned to
fabrication differs from the expected number by 21 stan-
dard deviations; detailed calculations show that the likeli-
hood of this occurring by chance is less than 1 in 10. See
Castaneda v. Partida, 430 U.S. 482, 496, n.17 (1977).
The department to which an employee was assigned was
important for two reasons. First, the hourly wage rates
were very different; as of 1974 the top hourly wage was
44.94 in fabrication, $4.47 in the warehouse, $3.47 in pre-
fabrication, and $2.70 in the stemmery.* Second, although
work in the other departments is year round, employment
in the stemmery is seasonal, averaging only 9 months a
vear.® Thus as of 1971 the average annual wage in fabrica-
tion, to which 75% of all whites were assigned, was over
$8.00, while the average annual wage in the stemmery, to
which 61% of all blacks were assigned, was under $4,000."
Nn this basis the district court held that “[t]he statistics
establish a prima facie case of racial and sexual dis-
crimination.” App, 20a. The district court also rejected as
unsupported by the record a variety of defenses alleged by
the defendants. App. 27a-30a. It specifically held that there
was no evidence that black applicants were less qualified
than white applicants. App. 30a, 45a. The district court
thus concluded that the defendants’ practices violated Title
VII and held that injunctive relief and back pay were
required. App. 38a.
On appeal the Fourth Circuit did not question the district
eourt’s finding of a prima facie case. This Court’s opinion
in Furnco Construction Corp. v. Waters, 57 L.Ed. 2d 957
§ 7d. pp. 416-19.
457d. p. 93; App. 4a.
46'The average hourly wage in fabrication is about $3.94, Ap-
pendix p. 636, or $8,195 per year for fifty-two 49 hour weeks. The
average hourly wage at the stemmery is about $2.21, Appendix
pp. 586, 629, or $3,447 per year for thirty-nine 40 hour weeks.
18
(1978), decided a month after the Fourth Cireuit decision
in this case, requires an appellate court in such a situation
to consider whether the employer has met his burden of
rebutting the prima facie case by “proving that he based
his employment decision”, here some 8,000 assignments, “on
a legitimate consideration”, 57 L.Ed. 2d at 968. If the em-
ployer does not meet that burden the court of appeals must
find that there was intentional racial discrimination; the
fact that the district court failed to make such a finding
does not relieve the appellate court of its responsibility to
do 80.” ld.
The Fourth Cireuit, however, did not make the factual
inquiry required by Furnco, Instead, it restricted itself to
considering whether the district court had applied the cor-
rect legal standard in analyzing the evidence. The appellate
court noted that the district judge had not found present
purposeful discrimination “by the Company”, but had rea-
soned somewhat opaquely that the company’s “past acts of
discrimination”, coupled with a failure to inform applicants
that those policies had ended, had created “a set of cireum-
stances that has continued to place blacks at a disadvantage
when seeking employment at Phillip Morris.” App. 82a.
The court of appeals believed that the district court had
held that employers must maintain a racially balanced work
force, a requirement the Fourth Cireuit thought erroneous.
App. 74a-76a. Having concluded that the district court’s
theory of liability was incorrect, the Fourth Cireuit should
either have remanded the case for application of the proper
standards, Hazelwood School District v. United States, 433
TS. 299, 309, 312 (1977), or analyzed the evidence itself in
light of those standards. Furnco Construction Corp. Vv.
Waters, supra. Instead the court of appeals simply, and
inexplicably, directed dismissal of the race claim. This dis-
position is particularly difficult to understand in view of
the fact that the court of appeals followed the correct proce-
19
dure with regard to the sex claims; reversing the district
court finding of sexual discrimination in part because it was
based on “the same” erroneous assumption that the em-
ployer had to proclaim a policy of non-diserimination in
order to encourage racial balance, App. 90a, the court of
appeals remanded the sex claim for additional findings and
evidentiary hearings. App. 98a.
The court of appeals’ peculiar disposition of the race
claim appears to have been influenced by the assumption
that the pattern of assignments between 1965 and 1973
might have been due to the fact that from 1971-73 hiring
for the stemmery was conducted at a different time or loca-
tion than hiring for the traditionally white departments.
App. 78a. The Fourth Cireuit apparently believed that
blacks preferred to work at the stemmery, and thus ex-
cluded themselves for consideration for fabrication jobs by
applying only for poorly paid seasonal positions at the
stemmery. In fact, however, the segregation of the hiring
procedures had no such impact, for 81% of all blacks chose
to apply for permanent jobs rather than for work at the
stemmery.’? Given a choice between applying for perma-
nent work or seasonal stemmery jobs, blacks overwhelm-
ingly sought the former, most of them in the fabrication
department, even though, consistent with its past practice,
the company hired 33% of all blacks who applied for the
stemmery®® but only 16% of all blacks seeking permanent
jobs." Thus following the introduction of separate hiring
procedures, which for the first time gave black applicants
a method of avoiding assignment to the stemmery, the pro-
47 Of 9795 black applicants in 1973 only 1790 ipplied for work
at the stemmery, Appendix 493, 626.
48 In 1973 the company hired 583 of the 1790 blacks who applied
for work at the stemmery. Appendix, pp. 591, 626.
49Jn 1973 the company hired 1250 of the 8005 blacks who ap-
plied for pemanent jobs. Appendix, pp. 493, 587, 626.
20
portion of blacks among employees hired into fabrication
did not decrease, as the court of appeals assumed, but ac-
tually rose from 18% in 1970 to 41% in 1972. That change
graphically illustrates the discriminatory nature of the
assignment practices which were particularly effective prior
to 1971.
CONCLUSION
For the above reasons a Writ of Certiorari should issue
to review the judgment and opinion of the court of appeals;
in the alternative, Certiorari should be granted and the case
remanded to the Fourth Cireuit for reconsideration in light
of Furnco Construction Corp. v. Waters.
Respectfully submitted,
°° Appendix p. 588.
JacK GREENBERG
O. Peter SHERWOOD
Eric ScHNAPPER
Suite 2030
10 Columbus Circle
New York, New York 10019
Henry L. Marsn, ITT
Wim H. Bass, ITT
Jonn W. Scort, Jr.
Ranpatt G. JoHnson
Hill, Tucker & Marsh
214 East Clay Street
Richmond, Virginia 23261
Barry L. Goipstern
Suite 940
806 15th Street, N.W.
Washington, D.C. 20006
Counsel for Petitioners
APPENDIX
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF VIRGINIA
RICHMOND DIVISON
Civ. A. No. 73-0488-R.
July 7, 1976.
rt re te
=== === = eee eee eee
NORA LEWIS, et al,,
Plaintiffs
—
PHILIP MORRIS, INC., et al.,
Defendants.
rrr
== = = === eee eee See eee
dea eeseeSSSS855E5SSSES SSS ESS 5285585585"
a gusussaesssaessesssssessssssss sss SES
HERHIGE, District Judge.
This class action is brought for alleged
discrimination against females in employment
matters in violation of Title VII of the Civil
Rights Act of 1964, as amended, 42 U.S.C. §2000(e),
et sea., for alleged dicrimination against blacks
in employment matters in violation of both Title
- 2a -
VII, supra, and the Civil Rights Act of 1866, as
amended, 42 U.S.C. §1981, and for an alleged
breach of a union's statutory duty to fairly
represent all of its members. Section 9(a)
of the National Labort Relations Act, as amended,
29 U.SA.C. §159(a); see Vaca v. Sipte, 386 U.S.
171, 87 S. Ct. 903, 17 L.Ed.2d 842 (1967). The
named plaintiffs, Nora Lewis, Elizabeth Bullock,
Mary Carter, Betty Johnson, and Gertrude Moody,
are all black female citizens of the United States
residing in the City of Richmond, Virginia. They
are employed by Philip Morris, Inc., at its
facilities in Richmond, Virginia and are members
of Local 203 of the Tobacco Workers' International
Union.
Defendant Philip Morris, Inc., (hereinafter
"Philip Morris" or "Company") is a corporation
Organized under the laws of the State of Virginina
and engaged in the business of manufacturing and
marketing consumer goods that travel in interstate
and foreign commerce. It has several cigarette
manufacturing plants in the City of Richmond,
Virginia. Accordingly, the defendant Philip
Morris is an employer in the industry affecting
commerce within the meaning of §701(b) of the
Civil Rights Act of 1964, 42 U.S.C. §2000e(b),
and is subject to the provisions of 42 U.S.C.
§1981. See Johnson v. Railway Express Agency, 421
U.S. 454, 459 60, 95 S.Ct. 1716, 44 L.Ed.2d 295
(1975); Tillman v. Wheaton-Haven Recreation Ass'n,
410 U.S. 431, 439-40, 93 S.Ct. 1090, 34 L.Ed.2d
403 (1973); cf. Jones v. Alfred H. Mayer Co., 392
U.S. 409, 88 S.Ct. 2186, 20 L.Ed.2d 1189 (1968).
Defendant Local 203 of the Tobacco Workers'
Internatiorel Union (hereinafter "Local 203")
is am unincorporated association and a labor
union, duly designated and elected as the rep-
resentative for the purpose of collective bargain-
ing of approximately 5,300 hourly paid employees
of Philip Morris in its facilities in Richmond,
Virginia. Defendant Tobacco Workers’ Interna-
tional Union (hereinafter "International Union")
is an unincorporated associ*tion and labor union
headquartered in Washington, D.C.; Local 203 and a
number of other local unions are affiliated with
International Union. Accordingly, defendants
Local 203 and International Union are both labor
organizations engaged in an industry affecting
commerce within the meaning of §701(d) of the
Civil Rights Act of 1964, 42 U.S.C. 2000e(d) and
(e), and are subject to the provisions of 42
U.S.C. §1981. See Johnson v. Railway Express
- he -
Agency, supra; Tillman v. Wheaton-Haven Recreation
Ass'n, supra.
This Court has jurisdiction over the claims
raised in the instant action pursuant to 42
U.S.C. §2000e-5(f), 28 U.S.C. §1343(4), and 28
u.s.c. §1337.4/
The’ Company's manufacturing operations in
Richmond are departmentalized as follows: (1)
Warehouse, Shipping and Receiving (hereinafter
("WSR"); (2) the Green Leaf Stemmery (herein-
after ("Stemmery") -- where the then current crop
of tobacco is processed for storage; (3) Prefabri-
cation -- where tobacco in bulk is processed for
cigarette manufacture; and (4) Fabrication --
where the cigarettes are manufactured. All the
Richmond employees of Philip Morris except the
Stemmery employees are employed on a year round
basis; the Stemmery employees, with the exception
of a smail housekeeping statf, are employed
seasonally for the period of July to March.
1/ E.g., Munford v. Glover, 503 F.2d 878, 883
(Sth Cir. 1974); Retana v. Local 14, 453 F.2¢
1018, 1021-22 (9th Cir. 1972).
The employees represented by defendant
Local 203 include both the seasonal employees of
Philip Morris who work at the Stemmery, and the
permanent hourly-paid employees who work at the
other Company manufacturing locations. Rates of
pay, job progression, transfer and seniority of
employees, working conditions, and employee
benefits are covered by two collective bargaining
agreements between the Company and Local 203. One
agreement -- the "main contract" -- covers the
permanent employees, and the other ~~ the "supple-
mental contract" covers the seasonal employees.
The contracts presently in force were negotiated
in January 1974, and took effect February 1, 1974
for a three year period to expire on January 31,
1977. The contracts follow the pattern set by
prior contracts between the Company ana Local 203,
commencing with those neogiated in the fall of
1964 which became effective on February l, 1965.
Named plaintiff Elizabeth Bullock was first
employed by the Company in November 1966; plain-
tiff Gertrude Mucdy was first empisyed in October
1966; plaintiffs Nora Lewis, Mary Carter, and
Betty Johnson were first employed in December
1968. Each of the named plaintiffs was first
- 6a -
employed in the Stemmery, and remained there until
April 25, 1972 when they were transferred to the
Fabrication Department. Upon their transfer, they
acquired transfer date seniority in accordance
with the seniority system set forth in the then
current 1971 collective bargaining agreement.
Each was intitally assigned to the entry level
"miscellaneous" job classification in the fabrica-
tion process, which required them to perform
the arduous task of hanging of trays. The hanging
of trays required lifting up six trays per minute,
each weighing up to forty pounds, to a height of
over six feet.
By order of October 7, 1974, the Court
determined that the action be maintained as a
class action pursuant to Rule 23(b)(2) of the Fed.
R. Civ. P., see e.g., Robinson v. Lorillard
Corporation, 444 F.2d 791, 802 (4th Cir. 1971), on
behalf of a class consisting of the named plain-
tiffs and all females and black males, whether
currently employed or no longer employed for any
reason, who were employees of the defendant Philip
Morris's Green Leaf Stemmery on or after July 2,
1965. See Patterson, et al. v. The American
Tobacco Company, C.A., 535 F.2d 257, at 262 (4th
Cir. 1976). The class consists of approximately
- Ja -
3,130 persons. Notice, pursuant to Rule 23(b)(2)
of the Fed. R. Civ. P., was given by mail to
each of the class members on October 8 and or ll,
1974, and notices of the pendency of the action
were posted at several locations on the premises
of Philip Morris.
The plaintiffs initialy contended that the
Company, with the assent and cooperation of the
defendant unions, discriminated against female
members of the class on the grounds of their
sex and against black members of the class on the
grounds of their race, and additionaily, that the
defendant Unions failed to press grievances of
females or black males with the same diligence as
those of white males. More specifically, the
complaint alleges that discrimination was per~
petuated by: (1) intially assigning females and
black employees to seasonal Stemmery jobs in
numbers disporportionately large as compared to
the initial assignment of white males to Stemmery
jobs; (2) paying female Stemmery and black Stem-
mery employees less than white male Stemmery
employess for comparable work; (3) maintaining
unlawful seniority and transfer polices which
restricted female Stemmery and black male Stemmery
- 8a -
employees from transferring to other plants; (4)
promoting and transferring junior white male
Stemmery employees over senior Stemmery females;
(5) segregating female Stemmery employees into
separate "female" jobs; (6) assigning black female
employees transferred from Stemmery to the most
arduous jobs in the Fabrication Department for
disporportionately long periods of time; (7)
passing over females and black male employees with
greater experience, skill and seniority than white
males (i) in the selection of supervisory person-
nel, and (ii) in providing training for and access
to skilled and craft positions; (S) laying off
senior females and black males before junior white
males in reduction of force; and (9) maintaining
disability leave policies which discriminate
against maternity leave.
Shortly before trial, however, the parties
entered into an agreement for a partial settle-
ment, which provided inter alia that trial would
be limited to the following issues: (1) whether
the members of the class were hired into the
Stemmery rather than into permanent employment as
a result of racial or sexual discrimination; (2)
whether the transfer, promotion, seniority, intial
job assignment and wage rate policies discrimi-
mated against class members on the basis of race
or sex, except in the selection of supervisory
and craft personnel, (3) if discrimination in any
of the foregoing were found, whether injunctive
relief is appropriate and what amount of back pay,
if any, should be awarded class members; and (4)
what costs, expenses and attorney fees shouid be
awarded. All claims for affirmative relief sought
on the basis of alleged discriminatory working
or disciplinary conditions were withdrawn. The
maternity leave issue was expressly reserved.
The partial settlement agreement was approved by
the Court on June 6, 1975 after appropriate
notice of the agreement was given all members of
the class, pursuant to the provisions of Rule
23(e) of the Fed. R. Civ. P.
On or about March 16, 1970, the named
plaintiffs Mary Carter, Elizabeth Buliock,
and Gertrude Moody, along with thirty-six other
black female employees at the Company, filed
charges with the Equal Employment Opportunity
Commission (hereinafter "EEOC") alleging violation
of their rights under Title VII of the Civil
Rights Act of 1964. On or about October 29, 1972,
- 10a -
named plaintiffs Nora Lewis and Betty Johnson
filed similar charges with the EEOC. On that
same day, plaintiffs Carter, Bullock and Moody
filed additional charges with the EEOC alleging
violations of their rights under the Civil Rights
Act. The complaints filed with the EEOC, taken
together, expressly list all the defendants as
offending parties. In letters dated July 25,
1973, the EEOC advised all of the named plaintiffs
of their right to institute an action in federal
court. In letters dated August 21, 1973, the EEOC
advised plaintiffs Mary Carter, Elizabeth Bullock,
and Gertrude Moody of their right to sue on their
amended charges. The instant action was filed on
September 9, 1973 within the 90-day period speci-
fied in 42 U.S.C. §2000e-5(£).
The defendant International Union contends
that it was not served with notice of the EEOC
charges, nor approached by the EEOC in concilia-
tion negotiation, and argues, therefore, that it
should be dismissed as a party defendant.
The United States Court of Appeals for the Fourth
Circuit has held, however, that the Commission's
failure to attempt conciliation or serve notice on
defendants of filed charges is not a jurisdic-
tional bar to an employee's action if the employee
has properly filed his complaint. An employee
cannot be charged with the Commission's failure to
execute its statutory duties. Russell v. American
Tobacco Company, 528 F.2d 357 at 365 (4th Cir.
1975). Accordingly, the Court concludes that
International Union is properly before it as a
party defendant.
Before turning to the factual findings, the
Comany's contention that this Court's previous
decision of Quarles v. Philip Morris, Inc., 279
F.Supp. 505 (E.D. Va. 1968), is dispositive
of the race discrimination claims asserted in the
instant action on the grounds of res judicata,
collateral estoppel, or stare decisis, must be
addressed. In Quarles, a black employee of
Philip Morris brought a class action agains the
Company, Local 203 and the Local's President
on behalf of all blacks employed therein alleging
racial discrimination in violation of Title VII of
the Civil Rights Act of 1964. The Court held
inter alia that "The company has not engaged in
discriminatory hiring practices since January l,
1966, and consequently, the plainiffs are not
entitled to relief on this issue." It also held
- l2a -
that Stemmery employees were not discriminated
against by the advancement, transfer, and senior-
ity policies of the Company.
"In fashioning a remedy the court must first
determine the class of employees to which it
is applicable. . . Emplovees of the stemmery are
mot included in the class. They are seasonal
employees hired on a temporary basis only. They
do not attain permanent employment seniority
unless they are hired as regular employees in
another department. The company's experience
with the generally poor quality of labor available
on a seasonal basis provides a rational classifi-
cation that distingutshes seasonal employees from
permanent employees." 279 F.Supp. at 519.
If the decision is deemed to be contolling
over the instant controversy, it would bar
those members of the class who were members of the
Quarles class from relief on the grounds of res
judicata, and it would serve as a strong precedent
against those members of the present ciass not
parties of the class in Quarles on the grounds of
stare decisis -- unless the plaintiffs can show a
significant change in the factual circumstances
from those of the Quarles case, that decision
would control. However, the Court concludes on
~ 13a -
the basis of either of two rationales that Quarels
does not so control, for the class in Quarles did
not adequately represent the claims of the class
in the instant case.
Although the class in Quarles did include
Stemmery employees, indeed the named plaintiffs in
that case were former stemmery employees who had
transferred to the Prefabrication Department, the
claims of the Stemmery employees were seemingly
lost in the breadth and ambition of the class's
overall interest. Quarles, which was one of the
early resolutions of a Title VII controversy,
reflects in its opinion and documents contained in
the case file that the plaintiffs therein were, in
part, seeking to secure equal benefit for what
readily appeared to be a deserving class ~~ the
black permanent employees of the Company. For
example, in the Court's findings that the Company
had not engaged in discriminatory hiring practices
after January 1, 1966, the Court based its conclu-
sion on the fact that the percentage of blacks in
Fabrication and WRS had been substantially in-
creased. It also noted, with less emphasis, that
the percentage of blacks in the Stemmery and
Prefabrication, "while still large," had been
- l4a -
reduced. The Court's findings that blacks were
not discriminated against in payment scales was
based on a consideration of the rates of compar-
able jobs in the permenent departments, even
though jobs existed in the seasonal departments
that could be compared to similar jobs in the
permanent departments. Additionally, the Court
summarily excluded the Stemmery employees from any
consideration of promotion or transfer discrimina-
tion, while granting relief to blacks in one of
the Company's permanent departments. The Quarles
opinion, authorized by now United States Circuit
Judge John D. Butzner, was and is one of the
monumental decisions in the area of Title VII law
for its astute realization that practices that are
currently neutral may, in effect, perpetuate
past discriminatory practices. It suffers,
however, from the plaintiffs' attempt to include
a broad class of litigants and yet prepare and
advocate with force the claims of some class
members to the detriment of a distinct and
aggrieved alternate portion of the class.
As Mr. Justice Harlan observed: "The judgment
in a class action will bind only those members of
the class whose interests have been adequately
- 1Sa -
represented by existing parties to the litigation.”
Sam Fox Publishing Co. v. United States, 366 U.S.
683, 81 S.Ct. 1309, 1314, 6 L.Ed.2d 604 (1961).
See Wetzel v. Liberty Mutual Insurance Co., 508
F.2d 239 (3d Cir. 1975); Gonzales v. Cassidy, 474
F.2d 67, 74-75 (5th Cir. 1973); M. Frankel, Some
Prelininary Observations Concerning Civil Rule 23,
43 F.R.D. 39 (1867). See also Hansberry v. Lee,
311 U.S. 32, 61 S.Ct. 115, 85 L.Ed. 22 (1940).
The generally accepted standard to be employed for
determining whether the class was adequately
represented in Quarles is whether the class
representatives, through their counsel, vigorously
and tenaciously protected the interests of the
entire class. See Gonzales v. Cassidy, supra.
Viewing the entire Quarles record and the Court's
finding in that case, the Court now concludes that
the interests of the seasonal employees of Philip
Morris were not satisfactorily advanced and
litigated.
The situation of the seasonal employees was
exacerbated by the failure to notify the members
of the class of the pendency of the litigation.
Although Rule 23 does not mandate notice for (b)(2)
actions such as the instant one, the Federal Rules
of Civil Procedure must give way to constitutional
- l6a -
imperatives. In the typical (b)(2) class action,
notice would not appear to be necessary; the class
is typically homogenous without major conflicting
interests between members, and often it is small
in number. In most (b)(2) cases, "[n]otice would
add little or nothing." 3B J. Moore, Federal
Practice %723.07[1] (2d ed. 1974) at 1152. How-
ever, most raciai and/or sexual discrimination
cases simply do not fit this sterotype. They
are large and often encompass a varied set of
subclasses -- this case, for example, includes
both blacks and females. Indeed recent Fourth
Circuit decisions indicate that it should be
the policy of the federal courts to be receptive
to large classes in discrimination suits so as to
effectively finalize the controversy with respect
to the defendants and to, by economics of scale,
reduce the plaintiffs' and defendants’ trial
costs. See Barnett v. W.T. Grant Co., 518
F.2d 543, 548 (4th Cir. 1975). See also Long v.
Sapp, 502 F.2d 34, 43 (Sth Cir. 1974); Parham v.
Southwestern Bell Telephone Co., 443 F.2d 421 (8th
Cir. 1970); Rich v. Martin Marietta Corp., 522
F.2d 333, 341 (10th Cir. 1975). Binding all
class litigants to a judgment when they have had
no notice to the action served on them, runs a
- l7vJa -
substantial risk that the class members may in
fact be prejudiced without being heard or without
having the opportunity to assess, for themselves,
the adequacy of their purported representatives.
As was noted by Mr. Justice Jackson in Mullane v.
Central Hanover Bank & Trust Co., 339 U.S. 306,
314, 70 S.Ct. 652, 657, 94 L.Ed.2d 865 (1950),
"(t]his right ot be heard has little reality or
worth unless one is informed that the matter is
pending and can choose for himself whether to
appear or default, acquiesce or contest.”
The counter arguments, (1) that the district
judge can accurately assess the representativeness
of the named plaintiffs and (2) that aggrieved
class members can collaterally attack the judg-
ment, assume much in an area of constitutional
significance that typically will tolerate few
assumptions. The first argument assumes that the
district judge can foresee all the potential
claims that may be raised by class members in
contesting the adequacy of the class representa~
tives and resolve them, perhaps without specifi-
cally pointed argument, in a favorable manner.
This burden becomes more weighty as the class size
and diversity of class membership increase. The
- 18a -
second argument is a smoke screen for justifying
the blatant realization that some litigants have
not been or may not be afforded due process under
the procedures folowed in the first case. It is,
of course, far better to utilize appropriate
procedures at the first trial, than to throw the
burden upon the litigants who, in the face of a
seemingly valid judgment directly on the matter in
controversy, must attempt to regroup as a subclass
and argue, after-the-fact, that they were not
adequately represented. Furthermore, allowing
Or encouraging liberal collateral attacks on
(b)(2) class actions, defeats one of the prominant
purposes of class certification -- that of achiev-
ing a finality of claims with respect to the
defendants. Again, the potential and the need
for collateral attacks on the first judgment is
augmented as the class size and diversity of its
membership increases. There is a point at which
judicial paternalism is simply inoperable, and
the class members must be given the ability and
the opportunity to assess the adequacy of their
representatives themselves by being served with a
proper notification of the proceeding and their
options therein. That point was surpassed in the
- 19a -
Quarles case. See Schrader v. Selective Service
System Local Board No. 76, 470 F.2d 73 (7th Cir.
1972); Zeilstra v. Tarr, 466 F.2d lli (6th Cir.
1972); Eisen v. Carlisle & Jacquelin, 391 F.2d
555, 564-65 (2d Cir. 1968) (dicta), rev'd on other
grounds, Eisen v. Carlisle & Jacquelin, 417 U.S.
156, 94 S.Ct. 2140, 40 L.Ed.2d 732 (1968); Hoston
v. United States Gypsum Co. 67 F.R.D. 650 (E.D.
La. 1975); Newman v. Avco Corp., 380 F.Supp. 1282
(M.D. Tenn. 1974); McCarthy v. Director of
Selective Service System, 322 F.Supp. 1032 (E.D.
Wis. 1970), aff'd per curuam on other grounds, 460
F.2d 1089 (7th Cir. 1972). But see Wetzel v.
Liberty Mutual Insurance Co., 508 F.2d 239 (3d
Cir. 1975); Gonzales v. Cassidy, supra. In
Quarles the class was large and subsumed several
distinct subclasses; the danger of failing to
adequately consider the plight of one or more of
these subclasses was readily apparent. Under the
circumstances, an order directing that all class
members be notified of the action so they could
champion their own interests should have been
requested and entered. Tre failure to so do
requires the court to now hold, consistent with
the constitutional demands of the due process
- 20a -
clause of the Fourteenth Amendment, that the class
members of the instant suit -~ the Stemmery
employees -- were not parties in any meaningful
sense to the Quarles action and, therefore, are
not bound by its decree under the principles of
res judicata. Nor are they bound by the princi-
ples of stare decisis, for the issues pertinent in
this action were not fully and fairly resolved in
the previous one.
Recent case law indicates that a prima
facie case of discrimination may be demonstrated
by statistical evidence that blacks and/or females
receive disparate treatment from that afforded
whites and/or males at the hands of the defen-
dants. e.g., Barnett v. W.T. Grant Co., 518 F.2d
543 (4th Cir. 1975); and that burden shifts to the
defendants to come forward with evidence to rebut
the plaintiffs’ cause. E.g., McDonnell Douglas
Corp. v. Green, 411 U.S. 792, 802-03, 33 $.Gt.
1817, 36 L.Ed.2d 668 (1973); United States v.
Chesapeake & Ohio Railway Co., 471 F.2d 582 (4th
Cir. 1972); see also United States v. Hayes
International Corp., 456 F.2d 112, 120 (5th Cir.
1972); United States v. Ironworkers Local 86, 443
F.2d 544, 550 (9th Cir. 1971). Cf. Albemarle
- 2la-
Paper Co. v. Moody, 422 U.S. 405, 425, 95 S.Ct.
2362, 45 L.Ed.2d at 280 (1975).
The statistics gathered by the plaintiffs and
submitted in evidence establish a prima facie case
of racial and sexual discrimination. Philip
Morris assigned over fifty percent of all blacks
initially hired from 1965 to 1974 to the seasonal
Stemmery jobs, as compared with the assignment of
only eleven and five-tenths of all whites hired in
the same period to the Stemmery. These per-
centages reveal a disproportionate assignment of
newly hired blacks to the Stemmery where the work
is temporary and less financially remunerative.
As a consequence, during the 1965 to 1974 period,
an average of seventy-nine and five-tenths precent
of all the hires in the Stemmery were black as
compared with an average percentage of blacks in
the Richmond work force of about twenty-four
percent .+' The heavy assignment of blacks to
2/ The Standard Metropolitan Statistical Area
(SMSA) for Richmond as defined by the Bureau of
the Census for 1960 included the City of Richmond
and the Counties of Chesterfield and Henrico.
The 1960 census reports that the civilian labor
force was 169,554, of which 42,942 (25.3%) were
blacks and 82,142 (48.4%) were females.
- 22a -
of blacks to the Stemmery has caused it to be a
predominately black department; during the 1965
to 1974 period the average percentage of blacks
in the Stemmery work force was eighty-four and
three-tenths percent. These statistics are
particularly significant in light of the Stem-
mery's history; since its inception in the
1930's and until the early 1960's, the Stemmery
operation has been manned almost exclusively by
blacks in accordance with a racially defined
2/ Cont 'd
The Standard Metropolitan Statistical area
(SMSA) for Richmond as defined by the Bureau
of the Census for 1970 included the City of
Richmond and the Counties of Chesterfield, Henrico
and Hanover. The 1970 census reports that the
civilian labor force over age 16 in the Richmond
SMSA was 225,007, of which 52,409 (23.3%) were
blacks and 93,937 (41.7%) were females.
On April 27, 1973, the Richmond Standard
Metropolitan Statistical Area (SMSA) was revised
to include three additional counties. Charles
City, Goochland and Powhatan. The 1973 Richmond
SMSA included the City of Richmond and the
Counties of Chesterfield, henrico, Hanover,
Charles City, Goochland and Powhatan. In 1973,
the civilian labor force over age 16 in the
Richmond SMSA was 233,068, of which 56,090 (24%)
were blacks and 96,775 (42%) were females.
- 23a -
departmental system. Whites were hired into and
employed in the Fabrication operations and the WSR
operation, while, blacks were hired into the
Stemmery and Prefabrication operations. At first
glance, the data seems to indicate that the
racially defined system is being maintained.
Transfers from the Stemmery were largely
limited to openings in the Prefabrication Depart-
ment until the rules governing the transfers of
seasonal employees to permanent employment were
changed in the 1974 labor contract to allow
seasonal workers to fill entry level vacancies in
all areas of permenent employment during periods
of Stemmery shutdown. Prefabrication, also
historically a black department, continues to be
populated largely by blacks. The 1974 contract,
2/ Cont'd,
The 1970-73 Virginia Employment Commission
estimates of the percent of the total work
force which is comprised of blacks and females in
the Ricghmond SMSA is as follows:
Minority (black) 23.6% of the total
work force. Female 41.0% of the total
work force.
3/ So as to comply with executive orders then
issued, the Company, on May 1, 1961, established
a "Factories Employment Policy" which sought
to employ and promote employees without regard
to race.
- 24a -
however, provides permanent department employees
transferring from one permanent department to
another with seniority from the date on which
they were first permanently hired, while it
provides Stemmery employees who transfer with
seniority only from the date they first trans-
ferred to permanent employment. Accordingly, a
Stemmery employee will always be junior in subse-
quent transfers to an employee hired into one of
the permanent departments although both were hired
on the same cay.
Additionally, the plaintiffs have produced
evidence that several company job classifications
within each department are predominately "White"
or "black", and "male" or "female." In the
Stemmery, the female jobs have been in the "light
labor" category, and the male jobs have been in
the “heavy labor" category. Furthermore, the
higher order or "key" jobs have also been sexually
sterotyped; there are female tag meter operators,
male line-out and press operators, male fork Lift
operators, and a predominately male skeleton crew
that works during the shutdown period at the
Stemmery. Individuals transferring from the
- 25a -
Stemmery to other departments were also greeted
with job sterotyping. The Prefabrication Depart-
ment also maintained a "light labor" and "heavy
labor" classification; in Fabrication the jobs of
head-fixer and fixer are male, and the jobs of
catcher attendant, examiner, and inspector are
female; there has never been a female transfer
from the Stemmery to WSR. With respect to the
claims of racial discrimination, there have never
been any blacks in the highest paying fabrication
jobs of “head-fixer", stockroom clerk, or watch-
man. Several jobs in all of the departments have
been totally or predominately filled by one race
or sex.
In response to the plaintiffs’ claims of
hiring discrimination, the defendants have pro-
duced evidence indicating that black are more
willing to accept employment at the seasonal
facility, and that Fabrication and WSR, the
historically white departments, have a substantial
proportion of black workers.
Prior to 1971, all of the hiring of hourly
employees was done at the 20th Street facility.
In 1971, a separate hiring office was opened in
the Westab Building on Commerce Koad. At Westab,
- 26a -
one day a week was assigned exclusively to the
hiring of seasonal employees, and the remaining
four days assigned to the hiring of permanent
employees. Applicants for permanent or seasonal
employment applying on an unappropriate day
were instructed where and when to reapply. Westab
was in turn closed at the end of 1972, and sepa-
rate hiring offices were established at separate
locations for permanent and seasonal hiring.
The defendants introduced evidence that of 3,005
applicants for employment who appeared at the
seasonal employment office seeking work in the
period from 1973 to 1974, only 177, or five and
five-tenths percent, were white. Hiring proved to
be proportionate to the applicant ratio; out of a
total of 992 Stemmery hirees in that period, 50,
or five percent were white. Additionally, the
defendants demonstrated that the attrition rate
among black Stemmery employees has averaged
forty-one and one-tenth percent over the last ten
years, whereas the white average attrition rate
was forty-four and one-tenth percent .4/In con-
4/ The attrition rate is measured by the ratio
between the number whose employment with the
Company terminated during a given period, exclud-
ing those employees transferring to permanent
employment, to the total number who worked in the
- 27a -
clusion, the defendants contend that blacks
work in the Stemmery because they prefer to work
there, while whites are unwilling to accept the
work.
The argument has three possible components:
First, it may be based on the proposition that of
those people that are in fact qualified only to
perform Stemmery work, only the black portion of
the group ‘applies to the plants of Philip Morris
for work and is willing to accept Stemmery work.
This is another way of saying that blacks that
apply to Philip Morris facilities are on the whole
less qualified than whites that apply to the
same facilities. No evidence was introduced at
trial in support of such a proposition and it may
be and is rejected out of hand. Second, it may be
based on the proposition that, although whites
and blacks are hired in appropriate ratios in all
the permanent departments, once the decision is
advanced to the applicant that a permanent job is
4/ Cont'd.
Department during that period. However, the
evidentiary significance of the data is diminished
by the fact that both the white and black attri-
tion rates are substantially higher than the rates
in any of the permanent departments.
- 28a -
not available, (because of racially neutral hiring
cycles or a lack of suitable qualifications)
whites refuse to work and blacks accept it.
Third, it may be based on the proposition that
blacks prefer to work in the Stemmery, even though
given the choice of applying for permanent emp loy-
menc.
The second propostion is potentially sup-
ported by inference from the defendants' evidence
that the Company's two traditionally white depart-
ments now have a substantial population of black
workers. As of December 31, 1974, both Fabrica-
tion and WSR had a black population that repre-
Sent a reasonable degree of integration. As
compared to the number of blacks in the Richmond
work force, approximately twenty-four percent,
Fabrication has approximately forty-one percent
blacks in its work personnel, and WSR has approxi-
mately twenty-eight percent. From January 1, 1965
to December 31, 1974, thirty-two percent of all
personnel hired into Fabrication and sixteen
percent of all personnel hired into WSR were
black. Such data seems to indicate that when
positions are available in these two departments,
hiring is non-discriminating. If the third
- 29a -
permanent department, Prefabrication, is similar
in composition, it would support an inference that
all permanent positions are filled nondiscrimi-
mately and that blacks are willing to accept the
seasonal positions with more frequency than
whites. However, two unexplained factors destroy
the inference. First, Prefabrication, histori-
cally black, continues to be populated by an
approximately eighty-five percent black work
force [as of 1974]. From January 1, 1965 to
December 31, 1974, of all the personnel hired into
Prefabrication sixty-three percent were black.
Sixty-three percent of all blacks hired between
1965 and 1974 were either assigned to the stemmery
or Prefabrication; almost two out of every three
blacks hired. Yet only eighteen and eight-tenths
percent of the whites hired during the same
period were initially assigned to these two
departments; almost one out of every five whites
hired. A distinction between permanent and
nonpermanent hiring is not borne out by the facts.
Instead the argument is forced into the form that
most whites desire only positions in the WSR and
Fabrication Departments, which are filled nondis-
- 30a -
Criminately, and once denied these positions they
will not accept employment in either Prefabrica-
tion or the Stemmery. In such a form it merely
begs the question of why, percentage-wise, so many
more blacks than whites are assigned to specified
departments .>/ Furthermore, and this reasoning
applied with equal force against the third compo-
nent heretofore noted, no reason has been advanced
as to why blacks, as opposed to whites, are so
inclined to accept or prefer the seasonal and
lower paying jobs of the Stemmery. It is clear
from the evidence that blacks are qualified and do
fill the permanent positions in the WSR and
Fabrication Departments. The defendants do not
claim, as has been theretofore, noted, that
the black applicants are, on the average, less
3/ The evidence of white unwillingness to work
in the Stemmery is also somewhat questionable
in light of the 1965 statistics. In 1965 the
Company hired only 68 blacks into the Stemmery as
opposed to 186 whites, for a percentage of black
hires of only 26.8 percent. That year represented
a concerted effort to hire whites into Stemmery
work. For all the other years for which the Court
has been provided data, the percentage of black
hires ran from 73 to 98 percent.
- 3la-
able and qualified than white applicants. What
perverseness makes blacks as opposed to whites
more willing to accept what appear to be less
desirable jobs?
The answer in the Court's view lies in the
testimony of the plaintiffs' witness that "if you
want to get hired, you know, being black, your
best chance would be to go through the Stemmery
and then transfer to permanent employment later."
Philip Morris' history of segregated departments,
and the continued dominance of blacks in the
traditionally black departments, has led a swh-
stantial number of the blacks applying to Philip
Morris for work to the understanding that their
most likely opportunity for employment would
be in the Stemmery. It is not surprising that
the lines to the Stemmery hiring office are
populated with aspiring black workers, nor is it
surprising that blacks may, in interviewing,
exhibit a preference for Stemmery work. {t
appears to a substantial number of black appli-
cants that they either take a Stemmery job or look
for work with another employer. Given this
background, any notion of "preference" is meaning~
less; to prefer one alternative to another, one
must believe that both alternatives are available.
- 32a -
The Court is unable to find, however, on the
basis of the record before it that the excessive
assignment of blacks to the Stemmery was purpose-
fully undertaken by the Company to covertly
continue its historical system of segregated
departments. What has been established is that
the Company, although liberally proclaiming that
it assigns new hires without regard to their race,
has unfortunately done nothing to dispel the
belief, founded in its past acts of discrimination,
and held by a substantial number of black appli-
cants, that it still assigns new employees to
departments on the basis of race. Such a belief
has translated itself into a set of circumstances
that had continued to place blacks at a disadvan-
tage when seeking employment at Philip Morris.
The Company's professed neutrality, is, in fact,
mot neutral, for past acts of discrimination
continue to significantly affect modern practice.
"Under the Act, practices, procedures, or test
neutral on their face, and even neutral in
terms of intent, cannot be maintained if they
opreate to '‘'freeze' the status quo of prior
discriminatory employment practices." Griggs v.
- 233 -
Duke Power Co., 401 U.S.C. 424, 430, 91 S.Ct. 849,
853, 28 L.Ed.2d 158 (1971). See also Quarles v.
Philip Morris, Inc., supra. The Company, in order
to reassert a balance, should have informed all
applicants for hourly positions at the beginning
of any interview (1) of the positions currently
available in each of the four departments with an
appropriate job description, and (2) that it
assigns and hires new workers without reference to
race. All those class members that were not so
informed when they were hired into the Stemmery,
and that believed that their race substantially
limited their intial employment to the Stemmery
are entitled to recover for their losses. "What
is required of Congrtess is the removal of artifi-
cial, arbitrary, and unnecessary barriers to
employment when the barriers operate invidiously
to discriminate on the basis of racial or other
impermissible classification."
Power Co., 401 U.S. at 431, 91 S.Ct. at $853,
Griggs v. Duke
(Emphasis added) Cf. Barnett v. W.T. Grant Co.,
supra, 518 F.2d at 547; Lea v. Cone Mills Corp.,
301 F.Supp. 97, 102 (M.D. N.C. 1969), aff'd in
part, 438 F.2d 86 (4th Cir. i971).
- 34a -
With respect to the plaintiffs' claims that
the Company continues to maintain "male" and
"female" job classifications within the Stemmery,
and that transfers from the Stemmery face "male"
and "female", and "white" and "black" job class-
ifications within the permanent departments, the
argument is similar. The Company answers the
allegations with the contention that, although in
the past discrimination patterns with regard to
race or sex dia exist, jobs are now available to
all races and both sexes when openings are created
by retirement, transfer, or expanded capacity
demands. Additionally, it has introduced evidence
of average pay levels to prove that the Company
does not discriminate with respect to pay between
the various job classifications with respect
to race or sex. Finally, the defendants assert
that males tend to avoid job categories in whica
females predominate, and that females are reluc-
tant to qualify for jobs which require a high
degree of mechanical skill. In light of the
strong evidence of past acts of discrimination,
and the evidence of present segregation among job
classification, it is the duty and the burden of
- 35a -
the defendants to inform all potential applicants
for the various openings of said openings as they
develop and that these openings would be filled
without regard to sex or race. Those applicants
in the class that were not so informed and that
would have applied for any such openings if
informed, are entitled to recovery.
The plaintiffs’ attack the labor provisions
governing seniority, transfer and promotion of
seasonal employees on the grounds that they lock
seasonal employees into seasonal positions. These
provisions are discriminatory on racial or sexual
grounds only if class members are assigned to
seasonal positions on racial or sexual criteria.
Since the Court has concluded that class members
are often led to seek employment in the Stemmery
on the basis of past racial discrimination, it
must also conclude that the labor provisions that
restrict the seniority, transfer and promotional
rights of a seasonal employee so Situated are
likewise discriminatory. However, such a finding
does not require a redrafting of the seniority,
transfer, or promotion rules; it is the initial
assignment policies that taint the system. The
fact that Stemmery employees are more restricted
in their transfer rights than permanent employees,
- 36a -
without evidence of impermissible discrimination,
would represent a justifiable policy. Seasonal
employees are adjudged to be poorer workers on the
whole and must prove themselves in a permanent
capacity before they are given the rights and
benefits of permanent workers. See Section 703(h)
of Title VII, 42 U.S.C. §2000e-2(h).
The defendant unions are liable with the
Company to these class members that are able to
recover under the theories heretofore noted,
6/
for the Union also has a checkered past.— Along
with the racially segregated departments of Philip
Morris, there also existed racially segregated
local unions. Local 209 of the Tobacco Workers'
International Union represented only blacks in
Prefabrication, Stemmery, and the janitorial
6/ The International Union, due to its heavy
involvement in Local 203's activities, is jointly
responsible with the Local for the Union's failure
to fulfill its duties to the union membership.
See Patterson v. American Tobacco Company,
supra, at 270-271. International was an active
advisor to the Local, and sat in on most of
the Local's negotiations with the Company for
collective-bargaining agreements.
- 37a -
staff. Local 203 of the Tobacco Workers' Interna-
tional Union represented only whites in Fabrica-
tion and WSR. While separate unions existed, the
Company and the unions negotiated uneuqal wages
for the same work with blacks generally receiving
the lower wages. In 1963, in response to a
Presidential Executive Order, Local 209 and Local
203 merged; Local 203 became the surviving
entity. Since the union's past indicates that it
facilitated the Company's tradition of segregated
departments, it also must share the responsibility
for informing its members that all jobs are open
in all departments without regard to race or sex
so as to mollify members' present understanding as
based on past history. Its failure to perform
this function makes it jointly liable with the
Company to those plaintiffs entitled to recover.
The Court finds, however, that there is no
evidence of arbitrary action or bad faith conduct
on the part of the defendant unions towards the
class members in the handling of class member
grievances, see Griffin v. International Union,
United Automobile, A& AI W, 469 F.2d 181 (4th
Cir. 1972), or in representing the seasonal
emplovees in the negotiation process with Philip
- 38a -
Morris. Accordingly, the Unions were not guilty
of breach of their statutorty duty of fair
representation.
Counsel will be directed to meet and brief
the Court on the appropriate procedure for ascer-
taining the relief that should be made available
to those class members entitled to recover in this
cause. See generally, Franks v. Bowman Transporta-
tion Company, Inc., et al., 42 U.S. 747, 96 S.Ct.
1251, 47 L.Ed.2d 444, 44 U.S.L.W. 4356 (1976);
Albemarle Paner Co v. Moody, 422 U.S. 405, 95
S.Ct. 2362, 45 L.Ed.2d 280 (1975).
An appropriate order will issue.
- 39a -
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF VIRGINIA
RICHMON) DIVISON
Civ. A. No. 73-0488-R.
September 2, 1976
NORA LEWIS, et al.,
Plaintiffs
~ we =
PHILIP MORRIS, INC., et al.,
Defendants.
ORDER ADOPTING PLAINTIFFS' BACK PAY AND
INJUNCTIVE RELIEF GUIDELINES
MERHIGE. D.J.: All counsel having rep-
resented memoranda on suggested procedures to
facilitate an award of relief in this case which
have been fully considered; and
This Court being persuaded that the adoption
and entry of Back Pay and Injunctive Relief
- 40a -
Guidelines is necessary and appropriate to clarify,
simplify, and expedite the "State II" proceedings;
and that the Guidelines proposed by plainitffs are
consistent with and required by applicable law
including the Court's memorandum Opinion herein;
Now, therefore, it is hereby Ordered that the
Court adopts and enters the Back Pay and Injunc-
tive Relief Guidelines attached hereto and in-
corporated by reference herein. All Stage II
proceedings herein shall be governed by and
consistent with these Guidelines.
So Ordered.
Back Pay Guidelines
Guideline 1. Present Posture of the Case:
Certain issues previously disputed in this
case are now foreclosed by the Court's memorandum
opinion. The testimony and documentary evidence
already admitted shall not be duplicated in the
back pay determinations, except as to the extent
permitted herein, and any defenses appropriate to
the liability stage of the case are now precluded
and shall not be litigated in the back pay deter-
minations. English v. Seaboard Coastline R.R. Co.,
- 4la -
12 F.E.P. Cases 9D (S.D. Ga. 1975). And in
accordance with the earlier memorandum opinion,
this Court makes the following findings and
conclusions which are not subject to further
litigation by the parties.
(a) The defendants did nothing to inform
Blacks or to dispel their beliefs based upon
past acts of discrimination, and held by a sub-
stantial number of applicants, that the Company
still assigns new hires to departments on the
basis of race. Such a practice though neutral on
its face, and probably even neutral in terms of
intent, operated to "freeeze" the status quo of
prior discriminatory employment practices, thus
violating the Congressional mandate that employers
remove artificial, arbitrary, and unnecessary
barriers to employment which operate invidiously
to discriminate on the basis of race or other
impermissible classifications. Similarly, with
respect to segregation among job classifications,
because of the defendants' failure to take suf-
ficient affirmative actions to desegregate "male"
- 42a -
and "female" and "black" and "white" jobs, there
is unlawful discrimination in violation cf Title
vir.+/
(b) Because of the aforementioned findings
of discrimination, all affected members of the
plaintiff class are entitled to recover for their
losses through backpay and injunctive relief.
(c) The sole back pay issues now pending
before the Court are: (1) which class members
will receive back pay; and (2) how much will each
individual recover? All defenses advanced with
regard to the determination of a class-wide right
to back pay, and all defenses to individual back
pay based on arguments applicable to the class as
a whole which have been rejected by the Court's
decision shall not be used as defenses in any
second stage proceedings .2/
1/ Court's Memorandum Opinion, pp. 21-23
(entered July 7, 1976).
2/ Among the defenses specifically included
within the prohibition of this paragraph are the
following:
(a) The failure of any class member to apply
for or seek transfer from the Stemmery
to other permanent departments; Hairston
- 43a -
Guideline 2. Back Pay Period:
The period for which plaintiffs and class
members may recover awards of back pay in this
case is from March 16, 1968, to at least the date
of entry of the final decree in this action, with
either extension of the period or supplementation
of the award for those cliamants who have not yet
attained their "rightful place" by the date of the
final judgment. Patterson v. American Tobacco
Co., F.2d 12 F.E.P. Cases 314, 323
(4th Cir. 1976); and see 42 U.S.C. §2000e-5(g).
Guideline 3. Eligible Back Pay Class
Members:
The named plaintiffs and all females and
black males, whether currently employed or no
2/ Cont'd
v. McLean Trucking Co., 520 F.2d 226,
232 (4th Cir. 1975).
(b) The good or bad faith of defendants or
lack thereof. Albemarle Paper Co. v.
Moody, supra, 45 L.Ed.2d at 299.
(c) The fact that there may have been less
available vacancies than qualified
class members to fill them. Pettway,
supra, 494 F.2d at 260.
- 44a -
longer employed for any reason, who were employees
of the GLS on or after July 2, 1965 are eligible
for consideration for a back Pay award. Persons
presently retired, disabled, or otherwise termi-
nated from the company are not thereby excluded
from the back pay class. In the case of deceased
persons within the class defined for bcck pay
eligibility, claims may be maintained on their
behalf and any awards to such persons will
accrue to the benefici ries as designated on
defendant's insurance or payroll records.
Guideline 4. Identification of Back Pay
Class Members:
Within fifteen (15) days after entry of these
guidelines, the company, using its employment and
payroll records and other resources available to
it, will supply to plaintiffs' counsel and the
Court a list showing the name, address or last
known address, employment and seniority date,
social security number and income by month and
year, of every individual eligible for back pay as
specified in No. 3 above.
2a *
Guideline 5. Proof Required For Recovery
of Back Pay:
Plaintiffs have aiready shown (a) the exis-
tence of consistent and substantial disparities in
income and income opportunities between members of
the class and white males hired directly into
permanent departments; (b) that most members of
the class earned substantially and consistently
less than their white male permanent department
counterparts of like hire dates; (c) that class
members were effectively excluded from the higher
paying jobs and were limited in promotional
opprtunities and (d) that black and female appli-
cants are as well qualified as white male appli-
cants. In light of these findings, the proof
required to establish a class member's prima facie
entitlement to black pay will be determined under
the following principles:
S. All persons who are membeers of the
class as defined in number (3) above, with
with the exception of those who have knowingly and
voluntarily "opted out", shall be deemed eligible
for back pay by way of the company's employment
and payroll records; and
- 46a -
b. Counsel for plaintiffs may establish by
use of employment and payroll records that each
individual claimant's income was and/or is less
than that of the average of those white males with
the same or closest seniority date who were hired
directly into fabrication (hereinafter "the white
average"). Calculations of back pay shall be made
on a yearly basis (or fraction thereof) and no
deductions shall be made for any year's earnings
in excess of the white average.
CG. Each individual claimant may establish
that he was not informed of positions in depart-
ments other than the GLS; not given descrip-
tions of such jobs; not informed that the company
assigns new hires without regard to race or sex
and that if he had been soinformed he would
have applied for permanent employment.
d. Each individual claimant who is shown to
have met the requirements of 5(a) through (c)
above shall also have met his or her burden of
establishing a prima facie entitlement to back
pay.
Guideline 6. Proof Required to Defeat or
Limit Recovery:
a. Defendants may attempt to prove that any
particular class member is not entitled to re-
~
- 47a -
covery of back pay by showing the tui lowing =!
(i) He was informed, at the beginning
of the employment interview, of positions cur-
rently available in each of the four departments;
and
(ii) He was given a description of
the jobs in each of the four departments; and
(iii) He was informed that the company
assigns the hires new workers without reference to
race or sex; and
(iv) Although he was informed of (i)
through (iii) above that he made a free and
voluntary decision to forego permanent employment
opportunities or -was not qualified for permanent
employmert by the same standards applied to white
male employees, and therefore was not actually
injured in an economic sense by any unlawful
employment practices.
3/ See Johnson v. Goodyear Tire & Kubber
Co., 491 F.2d 1364, 1380 (Sth Cir. 1974); Baxter
v. Savannah Sugar Refining Corp., 495 F.2d 437,
445; Hairston v. McLean Trucking Co., 520 F.2d
226, 232 (4th Cir. 1975); Patterson v. American
Tobacco Co., F.2d (4th Cir. Feb. 23,
1976), Slip. op. at 25; and Franks v. Bowman
Transportation Co., U.S. 46 U.S. Law
Week 4356, 4363, Slip. op. at 23-24 (1976).
- 48a -
b. Any such proof shall be an affirmative
defense by clear and convincing evidence .+/
Guideline 7. Elements of Back Pay
Liability:
Any award of back pay to any claimant shall
include compensation for all elements of financial
loss, specifically:
(1) interest on all back pay amounts at the
legal rate of interest compunded from the time
when such income losses occurred until the time of
payment; (2) retirement, disability, overtime and
shift differentials, vacation and sick pay,
insurance and profit sharing plan adjustments
compensating for previous reductions due to
reduced income; (3) an "inflation factor" on all
awards to assure payment in "constant dollars,"
e.g., the same present value as the value of
income previously lost due to past discrimination
calculated according to U.S. Department of Labor
average cost-of-living data.
Guideline 8. Procedure for Assertion of
Back Pay Claims:
a. Plaintiffs will be allowed a reasonable
period for discovery of evidence pertinent to
the claims. To the extent practicable, this
- 336:
discovery shall be conducted informally.
b. Following compeltion of discovery,
plaintiffs shall perform the necessary calcula-
tions of back pay and front pay for each claim and
shall file written assertions of all claims
to be advanced on behalf of class members.
Cc. Defendants shall respond in wriring,
stating with respect to each claimant for whom
a claim is asserted, whether they contest the
claim in whole or in part, to what extent (if any )
they would be agreeable to resolution of the
claim, and the basis foritheir contest of the
claim.
d. If following responses to the claims by
defendants further discovery is necessary, it
shall be conducted and the parties shall again
attempt informal resolution of all claims.
e. Only those claims which cannot be
resolved between the parties shall be litigated.
Guideline 9. Notices to Class Members.
All notices sent to class members and stating
that forms should be filled out shall also state
that counsel for plaintiffs are available at
designated times and places to help them under-
stand and comply with the requirements.
- 50a -
Guideline 10. Hearing and Determination
of Disupted Back Pay:
Following completion of the procedures out-
lined in No. 8 above, the parties shall jointly
certify to the Court lists of all class members
whose back pay claims have been resolved by
agreement and whose claims are disupted. Eviden-
tiary proceedings will be held to resolve the
disputed claims.
Guideline 11. Calculation of Forward or
"Front Pay":
Each member of the class who is determined by
the procedure set forth above to be entitled to
back pay, who is still employed by the company,
and who has not attained his "rightful place'>/
shall be paid in addition to his regular pay rate
of per-hour or per-day period equivalent of his
back pay share & (nereinefter "adjusted rate")
5/ "rightful place" for purposes of back pay and
front pay is defined as the current white average
pay rate.
6/ “back pay share" is defined as the difference
between a class member's current earnings (as of
the date of the Decree) and the appropriate white
average earnings, e.g., if a class member is
earning $5.00 per hour and the white average is
$5.25, the "adjusted rate" of the class member
would also be $5.25.
- 5la -
until such time that he is placed in a job or is
eligible for a job, which he refuses, that
has a pay rate equal to the then existing white
average. Each class member shall be given oppor-
tunities to accept or refuse at least two dif-
ferent positions before losing the "adjusted
rate". Adequate records shall be kept of such
vacancies and rejections.
Guideline 12. Costs, Expenses, Attorney's
Fees and Allocation of Liability:
(a) Defendants shall pay to plaintiffs'
counsel on a current basis, reasonable attorney's
fees, expenses and costs of both the original
liability proceedings and the back pay and injunc-
tive relief proceedings.
(b) The defendants shall be made jointly and
seerally liable for costs, expenses, attorney's
fees and the judgment for back pay in favor of
class members. The resolution of any claims for
indemnification between various defendants shall
not preclude or delay the entry of the judgment
of, nor the payments for, back pay liability.
- 52a -
Injunctive Relief Guidelines
Guideline 1. Present Posture of Case:
The language used in number one (1) of
the Back Pay guidelines is incorporated by
reference herein with respect to injunctive
relief.
Guideline 2. The Period of Limitations
on Seniority Adjustment:
Class members who were employed in the
GLS on or after July 2, 1965 who are now or
will in the future be employed in permanent
departments and who meet all of the eligibility
requirements for back pay (with the exception of
earning less than the white average) shall be
awarded retroactive seniority in such permanent
departments for the time spent in the GLS.
Guideline 3. Definition of "Retroactive"
Seniority:
In calculating retroactive seniority for
class members, such seniority shall include
time lost during the GLS off season unless defen-
dants show by clear and convincing evidence
that an individual was offered an opportunity to
work in the off season and freely and voluntarily
- 53a -
declined it. The fact that there may have been
less available vacancies than qualified class
members to fill them shall not be a defense.
Guideline 4. Stemmery Transfer
Policies:
Defendants shall not limit or restrict the
number of seasonal employees who may transfer to
permanent employment at the end of each GLS
season.
Guideline 5. Future Hiring:
Defendants shall develop written job descrip-
tions for all entry level jobs in all departments
which shall be given to all applicants. These
shall include objective criteria for selection of
new hires. Applicants shall also be given the
hourly rates of each job. Hiring of applicants
for hourly jobs both permanent and seasonal shall
be conducted at each employment office; all
applicants shall be advised of all hires without
regard to race or sex. The company shall keep
applications active and on file for a period of no
less than one year.
Guideline 6. Proof Required to Defeat or
Limit Injunctive Relief:
Defendants may attempt to prove that any
particular class membcr is not entitled to senior-
- 54a -
ity relief by the same type of evidence required
to defeat or limit back pay, and in the same
manner as required in No. 6 of the back pay
guidelines. The failure of any class member to
seek or accept a transfer from GLS to a permanent
department shall not be a defense.
Guideline 7. Record Keeping an Reporting:
Defendants shall submit a report to the Court
with copies to plaintiffs' counsel, annually,
beginning one year from the date of the Decree,
and thereafter for the next two years, showing the
percentage of new hires by race and sex for each
department, the percentage of the total hourly
work force composition and each hourly job class-
ifiction composition, by race and sex, for each
department location; and the current location by
job and department of each GLS employee who
transferred within the one year period.
Guideline 8. Attorneys' Fees and Expenses:
Defendants shall pay to counsel for plain-
tiffs all attorney's fees, expenses, and costs of
the original proceedings on liability. For the
second stage proceedings, plaintiffs’ counsel
shall
fees
= $4a-i =
submit quarterly statements of attorney's
expenses,
and costs, to be paid within 20
days after receipt by defendants.
So Ordered.
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF VIRGINIA
RICHMOND DIVISON
Civ. A. No. 73-0488-R.
November 17, i976
NORA LEWIS, et al.,
Plaintiffs
- wg =
PHILIP MORRIS, INC., et al.,
Defendants.
—_— eS SS
ORDER
Deeming it proper so to do, it is ADJUDGED
AND ORDERED that this Court's Order of September
2, 1976 adopting guidelines for back pay and
injunctive relief be, and the same is hereby,
vacated.
The guidelines for back pay and injunctive
relief will be further considered by the Court,
if necessary, at the conclusion of the plaintiffs’
present appellate action.
- 56a -
Let the Clerk send copies of this Order to
all counsel of record, as well as copies of the
Court's Order filed October 12, 1976.
United States District Judge
- 57a -
IN UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
Nos. 76-1998-1999
76-2199
NORA LEWIS, et al.,
Appellees,
=» yg -
PHILIP MORRIS, INCORPORATED, et al.,
Appellants.
On Appeal From The United States District Court,
Eastern District of Virginia, Richmond Division
Before Russell, Widener, and Hall, Circuit
Judges.
Widener, C.J.: Philip Morris, Inc., the
Tobacco Workers International Union, and Local No.
25 of the Tobacco Workers International Union
appeal from a judgment finding them liable for a
violation of Title VII of the Civil Rights Act of
1964, 42 U.S.C. §§2000e et seq.
- 58a -
This suit is a class action= brought by
five black employees of Philip Morris. It is the
second such suit in recent years, repeating
many of the assertions made in Quarles v. Philip
Morris, Inc., 279 F.Supp. 505 (E.D. Va. 1968).
The plaintiffs’ claim involves the allegation
that the company, through discriminatory initial
job assignmert policies, segregates workers
into black and white departments.
2/
There are four departments— at the Philip
Morris plant in Richmond, Virginia, three of which
have permanent jobs, while at the remaining
department the work is seasonal. The most attrac-
tive and skilled jobs, providing the best pay and
the brightest opportunities for advancement, are
in the fabrication department, where cigarettes
are actually manufactured. Employees in fabrica-
1/ The class consists of the named plain-
tiffs and all female and black male cmployees,
whether currently employed or no longer employed
for any reason, who were employees of the defen-
dant Philip Morris' Green Leaf Stemmery on or
after July 2, 1965.
2/ We speak of four departments throughout this
Opinion merely for convenience. Actually, the
fourth department, the stemmery, is a separate
plant and is not an integral part of the manufac-
turing process at the Richmond, Virginia cigarette
plant.
- 59a -
tion are 41.1% black. The prefabrication depart-
ment, second ranked in pay and desirability and
which involves largely unskilled and considerable
heavy labor, is where the bulk tobacco is pro-
cessed into cut filler for use in the manufactur-
ing of cigarettes. Its employees are 85.2%
black. WSR, the warehouse department, third
ranked in pay and which also involved heavy labor,
largely unskilled, has 27.8% black employees. All
of these three departments have permanent, as
opposed to seasonal, jobs. The fourth department
is the stemmery. It is the lowest paying depart~
ment, almost wholly unskilled, and employment is
seasonal rather than permanent. and it has 95.4%
black employees.
The seasonal work is in the stemmery, where
the curent crop of tobacco is processed for aging
and storage. Historically, the stemmery has been
predominantly black, and it remains so. The
gravamen of the plaintiffs’ complaint is that the
company and the unions purposely assigned black
employees to the stemmery, which was the most
unfavorable department in the company's operation.—
3/ Before trial, the plaintiffs and Philip
Morris stipulated that the following were the only
issues to be tried:
- 60a -
The court, although finding a violation of
Title VIL for another reason, was unable to find
that "the excessive assignment of blacks to the
stemmery was purposefully undertaken by the
company to covertly continue its historical
System of segregated departments." Additionally,
the couré absolved the unions of any charges that
they violated their duty of fair representation.
However, in spite of the absence of purpose-
ful discrimination by the company or the lack of
fair representation by the unions, the district
court found the black employees believed that
3/ Cont'd.
"(1) whether the members of the class were
hired into the stemmery rather than into
permanent employment as a result of racial
or sexual discrimination;
(2) whether the transfer, promotion,
seniority, initial job assignmens and wage
rate policies discriminated against class
members on the basis of race, and sex,
except in the selection of supervisory
personnel;
(3) if discrimination in any of the fore-
going were found, whether injunctive relief
is appropriate and what amount of back pay,
if any, should be awarded class members;
(4) what costs, expenses and attorneys'
fees should be awarded."
the company discriminated against members of their
race in the assignment of jobs. Therefore,
it held that the company was liable because it did
not inform "all applicants for hourly positions
at the beginning of any interview (1) of the
positions currently available in each of the four
departments with an appropriate job description,
and (2) that it assigns and hires new workers
4/
without reference to race."—'Accordingly, it
3/ Cont'd.
The plaintiffs charged the unions with
complicity in alleged purposeful discrimination
and with a violation of their duty o: fair repre-
sentation as imposed by federal labor law.
4/ The folllowing finding from the memorandum
opinion is significant.
"The Court is umable to find, however, on the
basis of the record before it that the
excessive assignment of blacks to the stem~
mery was purposefully undertaken by the
company to covertly continue its historical
system of segregated departments. What has
been established is that the Company, al-
though liberally proclaiming that it as¢igns
new hires without regard to their race, has
unfortumately done nothing to dispel the
belief, founded on its past acts of discrim-
ination, and held by a substantial number
of black applicants that it still assigns to
- 62a -
ordered recovery of damages to class members who
were not so advised and "believed that their race
substantially Limited their initial employment."
We are of opinion that the district court
erred in giving relief to certain members of
the plaintiff class through the formulation of a
duty which Title VII does not require.
4/
Cont'd
departments new hires on the basis of
race. Such a belief has translated itself
into a set of circumstances that has con-
tinued to place blacks at a disadvantage when
seeking employment at Philip Morris. The
Company's professed neutrality is, in fact,
not neutral, for past acts of discrimination
continue to significantly affect modern
practice. ‘Under the Act, practices, proce-
dures, or tests neutral on their face, and
even neutral in terms of intent, cannot be
maintained if they operate to "freeze" the
status quo of prior discriminatory employment
practices.' Griggs v. Duke Power Co., 401
U.S. 424, 430 (1971), see also Quarles v.
Philip Morris, Inc., supra. The Company, in
order to reassert a balance, should have
informed all applicants for hourly positions
at the beginning of any interview (1) of the
positions currently available in each of the
four departments with an appropriate job
description, and (2) that it assigns and
hires new workers without reference to race.
- 63a -
Ae Initially, we dispose of a procedural
point raised by the appellees, who have moved for
dismissal of this appeal on the ground that the
order appealed from is not final order granting
relief, citing Liberty Mutual v. Wetzel, 424 U.S.
737 (1976). That order, entered on September 2,
19762! adopted to the letter the plaintiffs'
proposed guidelines for relief. While the guide-
lines consist in part of additional findings of
fact and conclusions of law, they require the
defendants, among other things, to supply a list
4/ Cont'd.
All those class members that were not so
informed when they were hired into the
stemmery, and that believed that their race
substantially limited their initial employ-
ment to the stemmery are entitled to recover
for their losses."
5/ The parties do not contest that an earlier
July 7, 1976 order is not an appealable order.
That order merely found for the plaintiffs on the
issue of liability, and did not require the
defendants to take any action. It only required
"counsel" to “forward to the court ... suggested
procedure appropriate to facilitate an award of
relief pursuant to the memorandum filed herein.’
For a similar order, see Liberty Mutual.
- 64a -
of all members of the class eligible for back pay,
to pay interim attorneys’ fees, to develop job
descriptions, not to limit transfer of employees
from the stemmery at season's end, to hire both
permanent and seasonal employees at each emp loy-
ment office, to advise all employees of all
vacancies, and to keep applications active and on
file for a period of no less than one year.
In determining whether an order is or is not
an injunction, we look to the substance, rather
than the form, of an order. Etteison v. Metro-
politan Life Insurance Co., 317 U.S. 188 (1942).
We believe the guidelines, requiring the defen-
dants to act in some instances and forbidding them
to act in others, to be an injunction .£' We do
6/ A further indication that the district
court understood its own order to require imme-
diate actions of the defendants is that, on
October 12, 1976, the court granted a stay of the
order pending appeal. Had the order not contem-
plated present acts from, or restraint on, the
defendants, such a stay would have been super-
fluous. Moreover, in opposing the stay, tie
plaintiffs at that time took the position that the
order placed present requirements on the defen-
dants and argued that the equity of relieving them
of the burden of complying with the order during
the pendency of the appeal.
- 65a -
not agree with the plaintiffs’ position that the
guidelines, although requiring present affirmative
action or restraint, are yet unappealable. Nor
does it gain support from Liberty Mutual, supra,
for there the court merely had found a violation
of the act and had not ordered the defendants to
take, or, refrain from, any action or to pay
attorneys’ fees. See 424 U.S. at 742.
But the plaintiffs say, assuming the law to
be as we have just recited, the appeal must
nevertheless be dismissed because the distric*
court, by order of November 17, 1976, vacated the
order of September 2, 1976 from which this appeal
has been taken. While the district court did
attempt, through the order of November ay. Sees
to vacate the order appealed from, it had no
power, after the notices of appeal were filed, to
enter such an order. In this, the plaintiffs
are not aided by the power given to the district
court through FRCP 62(c) which only applies to
allow the district court to make provision for the
"security of the rights of the adverse party."
Although the proceedings in the district court are
not stayed by an application for an interlocutory
- 66a -
appeal under 28 U.S.C. §1292(b), this is an appeal
from the granting of an injunction under §1292(a),
and the district court lost its power to vacate
the order when the notices of appeal were filed.
In this sense, this case is similar to Zimmer v.
McKeithen, 467 F.2d 1382 (5th Cir. 1973), where,
after the notice of appeal from a reapportion-
ment order was filed, the district court attempted
to change the order to encompass an alternative
apportionment plan. A panel of the Fifth Circuit
refused to consider the latter order, calling
it a nullity. The panel decision was reversed on
its treatment of the merits of the district
court's first order by an en banc court, 485 F.2d
1297 (Sth Cir. 1973), and the en banc court was
affirmed by the Supreme Court, which also examined
only the original order for the district court,
noting without criticism the panel's refusal to
consider the second order. Opinion styled East
Carroll Parrish School Board v. Marshall, 424 U.S.
636, at p. 638, n.4 (1976). Significantly, the en
banc court, as affirmed by the Supreme Court,
reversed the district court, a result which might
have been obviated by the consideration of the
second order, which would have replaced the
- 67a -
offensive elements of the first order. Hence, we
believe the Supreme Court has at least tacitly
acknowledged that a district court loses jurisdic-
tion to amend or vacate its order after the
notice of appeal has been filed, which we hold.
See also Sumida v. Yumen, 409 F.2d 654 (9th
Cir. 1969), cert. den., 404 U.S. 964, reh. den.,
405 U.S 1048 (1972); Aune v. Reynders, 344 F.2d
835 (10th Cir. 1965); Ideal Toy Corp. v- Sayco
Doll Corp., 302 F.2d 623 (2d Cir. 1962); District
65, Distributive, Processing and Office Workers
Union v. McKague, 216 F.2d 153 (3d Cir. 1954);
Miller v. United States, 114 F.2d 267 (7th Cir.
1940).
4 # As noted above, this case 1s an exten-
sion of, or the same, controversy decided ten
years ago. In the district court in that case,
Quarles v. Philip Morris,Inc., 279 F.Supp. 505
(E.D. Va. 1968), two black employees brougnt a
suit on behalf of all black employees of Philip
Morris, alleging "that the defendants by their
employment practices and collective bargaining
agreement refused to hire, promote to supervisory
positions, pay, advance and transfer Negro employ-
- 68 -
ees on the same basis as white employees."
279 F.Supp. at 507.
While finding that the company had discrimi-
nated against two Negroes with respect to pay and
against the named plaintiff Quarles and the
Negroes hired in the prefabrication department
before January 1, 1966 with respect to advance-
ment, transfer, and seniority, the Quarles court
expressly found that Philip Morris had not engaged
in discriminatory hiring practices since January
1, 1966 and that the company's policy for assign-
ment of workers to the stemmery did not violate
7/
Title VII.—’ Because of the similarity of the
7/ +The findings of the court included:
"IT. The company has not engaged in dis-
criminatory hiring practices since January },
1966, and consequently, the plaintiffs are not
entitled to relief on this issue.
ae: = The company has not discriminated on
racial grounds with respect to employment and
promotion of supervsiory personnel.
we i SS The company has discriminated on
grounds of race with respect to the pay of two
employees, Ephriam Briggs and Mrs. Lillie J.
Oatney; the plaintiffs have failed to establish
discrimination against Negroes with respect to
pay.
"iv. The defendants have discriminated
against Douglas R. Quarles and the class consist-
ing of Newgro employees who were hired in the
- 69a -
contentions presented in Quarles with those made
in the present case, the inclusion of the present
seasonal class members (black stemmery employees)
in the Quarles class (all black employees), and
the actual membership in the Quarles class by two
of this suit's named plaintiffs who were employed
by Philip Morris at the time of the Quarles
judgment, the defendants have contended at all
stages of this litigation that the doctrines
of res judicata and stare decisis should apply to
the present controversy.
The court below rcognized that the applica-
tion of res judicata, or even stare decisis, would
be highly damaging to the plaintiffs' case; the
vindication, in 1968, of the company's hiring
practices and stemmery assignment practices would
bind, insofar as the court found that, up the time
of the 1968 judgment, the hiring practices were
not racially motivated, the black female plain-
7/ Cont'd.
prefabrication department before January 1, 1966,
with respect to advancement, transfer, and senior-
cee. The plaintiffs are entitled to relief
correcting this discrimination." 279 F.Supp. at
p.9507.
-70a -
tiffs and the black male plaintiffs on the ques-
tion of racial disciimination. The district
court refused to implement res judicata on the
ground that the members of the Quarles class could
mot be constitutionally bound by that decision
because the class members had not been notified of
the pendency of the euit.2!
Thus, a decision as to the applicability of
the rule of res judicata would necessarily require
a determination of the constitutionality, facially
or as applied, of the provision in FRCP 23 making
a judgment binding on a member of a FRCP 23(b)(2)
class regardless of whether the individual
was notified of the suit. Because we are of
opinion the district court's judgment should be
reversed on grounds independent of the binding
effect of the Quarles judgment, we decline to
consider that issue. Ashwander v. TVA, 297 U.S.
288, 341 (1936) (Brandeis, J., concurring).
IIL. We now turn to the merits of the
appeal. The issues in the litigation, agreed
8/ The district court also stated that it be-
lieved the interests of the stemmery workers
were not adequately represented in the Quarles
action.
- Jla-
to prior to trial by the plaintiffs and the
company, are (1) whether the members of the
class were hired into the stemmery rather than
into permanent employment as a result of racial or
sexual discrimination, and (2) whether the trans-
fer, promotion, seniority, initial job assighment,
and wage rate policies discriminate against
class members on the basis of race or sex, except
in the selection of supervisory and craft person-
nel. All claims for affirmative relief on the
basis of alleged discriminatory working or disci-
plinary conditions were withdrawn by the plain-
extte.
In its opinion, the district court found that
the excessive assignment of black employees to
the stemmery was not motivated by a racially
discriminatory animus. It made no finding that
female employees were assigned to the stemmery
because of their sex. Additionally, the court
found that the-provisions of the collective
bargaining agreement governing transfer, promo-
tion, and seniority were nondiscriminatory and
would not have to be changed, but that discrimina-
tion existed in transfer, promotion, and seniority
because of initial assignment, as we discuss
later.
- 72a -
With these and other holdings later mentioned
the district court held both the company and the
unions to liability. While the opinion is not
clear on the precise grounds on whi~* it rests, it
can only be on one of two. First, that the
company and the unions had "unfortunately done
nothing to dispel the belief, founded on
[the company's] past acts of discrimination, and
held by a substantial number of black applicants
that it still assigns to departments new hires on
the basis of race." Second, that the company "in
order to reassert a balance, should have informed
all applicants for hourly positions at the
beginning of any interview (1) of the positions
currently available. in each of the four depart-
merts with an appropriate job description,
and (2) that it assigns and hires new workers
vithout reference to race."
A. So far as the opinion of the court
below may be said to have been based on the
defendants’ failure "to reassert a balance"
in its work force, the district court erred
in its interpretation of the demands of Title
- 73a -
VIL. Title VII does not require a racially
balanced work force, for such a conclusion is,
in the words of the Supreme Court, an “erroneous
theory." Teamsters v. United States, 431 U.S.
324, 339-40, n.20 (1977). Moreover, the problem
is explicitly dealt with by the statute.
Section 703(j) of the Act, 42 U.S.C. §2000e-
2(j}), makes clear that employer liability may not
be based solely on the existence of a racial im-
balance among employees, when the district court
had found the absence of purposeful discrimina-
tion. As explained by Senator Humphrey, the
purpose of this provision is to indicate the
absence from the statute of any required racial
balance:
A new subsection 703(j) is added to deal with
the problem of racial balance among employees.
The proponents of this bill have carefully
stated on numerous occasions that Title VII
does not require an employer to achieve any
sort of racial balance in his work force by
giving preferential treatment Co any indi-
vidual or group.
Legislative History of Title VII and IX of the
Civil Rights Act of 1964, Equal Employment
Opportunity Commission, Superintendent of Docu-
- 74a -
ments, p. 3005. Thus, §703(5)2/ forbids court
ordered preferential treatment designed solely to
achieve a racial balance, as well as the formula-
tion of liability based merely on the lack of
10/
racial balance.—'As far as the opinion of the
court below founded liability solely on the
company's failure to "reassert a racial balance,"
even though the defendants were not presently
discriminating, it is in error.
9/ 42 U.S.C. §2000e-2(j) provides in part:
"Nothing contained in this subchapter
shall be interpreted to require any employer
[or] labor organization . . . to grant
preferential treatment to any individual or
any group because of race ... [or] sex
of such individual or group on account
of an imbalance which may exist with respect
to the total number or percentage of persons
of any race ... [or] sex . . . employed by
an employer. Pa
10/ We are not unmindful that the existence
of a racially unbalanced work force might
support an inference of purposeful discrimination.
See Teamsters , 340, n.20. In the face of the
district court's finding that the defendant
did not purposefully discriminate against black
emloyees, that inference should not be drawn.
B. The analysis of the second ground of the
district court's decision is not so brief but
leads to the same conclusion.
The district court considered statistical
evidence that from 1965 to 1974 63% of all black
employees hired were either assigned to the
stemmery or prefabrication, while, during the same
period, only 18.2% of the white employees were
so assigned to these two departments. 50% of the
black employees initially hired during the period
went into the stemmery, compared to 11.5% of the
white employees hired in the same period. During
those years, an average of 79.5% of the employees
hired into the stemmery were black, and the
average percengage of black employees in the
stemmery work force was 84.3%. The average
percentage of black people in the Richmond work
force during that period was about 24%. The court
considered that the company had previously main-
tained segregated departments until the early
1960s and was of opinion the plaintiffs had made
out a prima facie case. It appeared however that
in fabrication, the most desirable department in
the company, the respective numbers of black and
- 76a -
white employees was not diffeent enough from
the make-up of the work force in the area to draw
any inference of discrimination therefrom, and
the same applied to the warehouse, the third most
desirable department. In prefabrication, the
second most desirable department, black employees
predominated. It also appeared that, commencing
in 1971, seasonal employment was conducted on
separate days or at separate locations, and
for the two years immediately past only 5.3% of
the applicants for seasonal employment were
white. The hiring of black and white employees
into the stemmery during those past two years
was proportional to the applications received.
The district court concluded that it was
"unable to find" "that the excessive assignment of
blacks to the stemmery was purposefully undertaken
by the company to covertly continue its historical
System of segregated departments." Considering
that Teamsters has made it clear that statistical
analysis serves as important role in cases con-
cerning employment discrimination and statistics
are competent proof of such, but that, like any
other kind of evidence, their usefulness depends
- Jla -
on all the surronding facts and circumstances, the
statement of the Court that statistics showing
racial or ethnic imbalance were probative in that
case “only because such imbalance was often a
'
telltale sign of purposeful discrimination, '
Teamsters, n.20, is consistent with the ruling of
the district court here that, despite the prima
facie statistical case, purposeful discrimination
was not shown. It is thus clear that, although
the district court considered whether or not to
base its finding on a prima facie statistical
case, it decided not to, rather finding that the
statistical case did not support the conclusion of
purposeful discrimination.
Instead, the district court found that ‘the
answer in the court's view lies in the testimony
of the plaintiff's witness that ‘1f you want to
get hired you know being black your best chance
would be to go through the stemmery and then
transfer to permenent employment later. '" The
reasoning behind this statement by the district
court was reiterated in various ways throughout
the opinion. For example, it provided for re-
covery for those class members who were not
- 78a -
informed by the company when they were hired that
the company did not discriminate and about all job
openings, and "that believed that their race
substantially limited their initial employment to
the stemmery.' It further stated that it had
"concluded that class members are often lead to
seek employment in the stemmery on the basis
of past racial discrimination." It found that th
collective bargaining contract provisions concern-
ing seniority, transfer, and promotion did not
have to be changed, and like the Quarles court, it
found seasonal employees to be poorer workers on
the whole who had to prove themselves before given
the rights and benefits of permanent employees.
We do not think a failure of the company to
announce innocence is a violation of Title
VIL. Neither do we think the failure of the
company to advise black applicants for stemmery
jobs of promotions available in the other depart-
ments is a violation of Title VII, when the
company treated all applicants, black and white,
the same. This is especially true when we con-
sider that the first and third departments in
order of desirability were not even found by
the district court to be statistically racially
imperfect in make-up or hiring, and, in the second
most desirable department of the company, black
employees predominated both in numbers and in
hirings.
Nor is it permissible to base recovery on the
subjective belief of class members "that their race
substantially limited their initial employment to
the Stemmery." Basing recovery on that fact is an
improper consideration. The question is whether
or not the company did in fact discriminate, not
whether or not the employee did in fact believe the
company had discriminated. It is at once apparent
that the consideration of these two questions
is entirely different 22!
The district court found that the company's
history of segregated departments and the con-
tinued dominance of black employees in the stem-
mery and prefabrication departments had led a
substantial number of black applicants for employ-
ment to understand that their most likely oppor-
tunuty for employment would be in the stemmery.
80a -
The court made this finding on the testimony of
one witness, a black female. She had applied for
work in the fabricating department, had been
turned down, and a short while later applied for
work in the stemmery and was accepted. It
was she who testified that if a black applicant
wanted to get hired his best chance would be to go
through the stemmery and then transfer to perma-
nent employment later. She had down just this.
Basing its entire holding on the testimony of
this witness is error for two reasons.
First. The witness herself had not been
discouraged from application fcr work in the
fabrication, for she had in fact applied, so the
acts of the witness as opposed to her testimony
could not cause a negative inference to be taken
against the company to prove the point the court
wanted to make; that black applicants believed
they would not be hired into the permanent
departmernts so they applied to the stemmery
instead of for permanent employment. Not only
the district court fail to find discrimination in
hiring in the fabrication department, as might be
logical from the testimony, not a signal other
- 8la -
witness testified that he had been discouraged
by belief or otherwise from applying for work in
one of the permanent departments, so the testimony
of the one witness stands alone, and her own acts
belie her words. Second, and equally as im-
portant, in the years from 1965 through 1974,
there was a total of 3388 black emplovees hired
into permanent departments. This number itself is
telling evidence that none of them were dis-
couraged from applying for work in the permanent
departments. Also during those years there were
3484 black employees hired into the stemmery. Not
one of them testified that he had been discouraged
from seeking employment in one of the permanent
departments, nor that he even had the belief
that he would have been accorded equal considera-
tion had he made application. Accordingly, we
are of opinion that cn the record before us this
finding of fact by the district court is clearly
erroneous. FRCP 52(a).
At this point we should say that, had either
the doctrines of res judicata or stare decisis
been applied, those parts of this opinion dis-
cussing racial discrimination in hiring into the
- 82a -
stemmery would have been inappropriate, or at
least largely so, for the plaintiffs would have
been bound by the earlier decision in Quarles. We
have so held in a case indistinguishable on its
facts, Griggs v. Duke Power Co., 515 F.2d 86 (4th
Cir. 1975), and the district court recognized this
in its opinion as it recited (obviously referring
to the situaion at hand) that the plaintiffs were
litigating "in the face of a seemingly valid
judgment directly on the matter in controversy."
(Italics are the district court's) Even consider-
ing that our characterization just above of the
import of the district court's language may be
incorrect, in Quarles the court held, on page 508,
that ". . . since January 1, 1966, the company had
not discriminated on the grounds of race in its
hiring policy. The court concludes, regardless of
practices before January 1, 1966, relief on this
issue is not now appripriate." This finding
12/
adverse to the plaintiffs was not appealed.— In
12/ The Quarles order provides in its first para
graph:
1. The plaintiffs’ prayer for an injunction
requiring Philip Morris, Inc., to modify its current
hiring practices is denied.
»
- 83a -
the case before us now, the plaintiffs obviously
realized that this holding in Quarles had to be
circumvented in some way or other, and the deci-
sion of the district court that the Quarles
plaintiffs did not properly represent the class
and that the application of FRCP 23(b)(2) to the
Quarles class plaintiffs was in violation of the
Fourteenth Amendment (obviously meaning the Fifth
Amendment) is the result. This undoubtedly
accounts for the failure of the plaintiffs to try
the present case on the theory that discrimination
took place after the judgment of the district
court in Quarles and to attempt to prove any
such discrimination as a separate item from any
discrimination which may have taken place before
that judgment. See Griggs, P- 88. While an
examination of the statistical evidence before
and after the judgment in Quarles may not seem to
disclose any differences of significant advantage
to the plaintiffs, this case has neither been
tried nor appealed on that ground. Believing that
we should not unnecessarily approach the question
of the constitutional validity, facially or in
application, of FRCP 23(b)(2), see Wright on
- 84a -
Federal Courts, 3d Ed. §72, to these class plain-
tiffs, since the case may be decided on another
ground, we expressly do not intimate any opinion
as to the correctness of the holdings of the
district court in that respect and also in respect
to the matter of the class being inadequately
represented in the Quarles case. The same reser-
vation applies to the ruling of the district
court refusing to apply stare diecisis.
Accordingly, we are of opinion that those
parts of the complaint alleging discrimination
by the company based on race should be dismissed.
C. The district court held the unions to
liability on much the same theory it held the
company.
It found the unions had had a "checkered
' for until 1963 the local unions were
past,'
segregated. The court found that their past
indicated they had facilitated the company's
traditon of segregated departments and that they
should share the company's responsibility for
informing their "members that all jobs are open in
all departments without regard to race or sex so
as to mollify members' present understandings as
- 85a -
based on past history." Their "failure to perform
this function makes ...[them] jointly liable with
the company to those plaintiffs entitled to
recover."
The only thing in the record which would
justify the court's finding of members’ present
understanding based on past history was the
testimony of the black female witness we have
above referred to and the finding based on it
which we held to be clearly erroneous. Applying
this finding to the unions is even more tenuous
than to the company because the unions had nothing
to do with hiring.
Because no member's present understanding has
been proved in this case, finding such a present
understanding is clearly erroneous. FCRP 52(a) .13/
We are thus of opinion those parts of the
complaint alleging discrimination by the unions
based on race should be dismissed.
13/. We do not intimate that the district court's
theory of holding the unions to liability is
correct. It is simply not necessary for us to
address the point.
- 86a -
D. The case of the class plaintiffs claim-
ing discrimination on account of their female
sex is different from that of the class plaintiffs
claiming discrimination based on race.
Referring back, the agreed issues to be tried
in this context were (1) whether women were hired
into the stemmery on account of their sex, and (2)
whether the transfer, promotion, seniority, intial
job assignment, and wage rate policies discrimin-
ated against them on the basis of sex. All
claims for affirmative relief sought on the basis
of aleged discriminatory working or disciplinary
conditions were withdrawn by the plaitiffs.
The court recited evidence and may have found
that the company did not discriminate with
respect to pay between the various job clssifica-
tions with respect to race or sex. As previously
recited, it found that the seniority, transfer,
and promotional rules did not have to be changed.
But it found that "{iJt is the initial assignment
policies that taint the system," and hold that
seniority, transfer, and pormotional restrictions
of seasonal employees were discriminatory, al-
though the holding did "not require a redrafting
of those provisions." What we make of these
seemingly contradictory rulings is that if an
intial discriminatory assignment affected later
rights, the empoloyee might recover.
Remarkably, the district court did not make
any finding as to whether or not women employees
were assigned to the stemmery because of their
sex, although we should have thought this was the
principal issue in the case. Perhaps the reason
was that its examination of the evidence agrees
with our own admittedly brief consideration
of some of the statistical evidence which shows
that about the same percentage of women were hired
into the stemmery as into permanent emplyment.
27.6% of the stemmery initial hires were female,
while 25.3% of the employees whose initial hiring
was into permanent departments were female.
Since we will not assume that sexual discrimi-
nation existed by reason of initial assignment to
the stemmery, the principal ‘sue left open, and
upon which the whole case largely depends, is
whether, upon hiring, the initial assignments of
female employees to jobs, whether within the
- 88a -
stemmery or within a permanent departuent ,--’ were
discriminatory on account of sex.
The district court recited that the plain-
tiffs produced evidence that several job classifi-
cations within various departments were predomi-
nantly male or female. It found that in the
stemmery female jobs have been in the light
category, while male jobs have been in the heavy
category, and that certain higher order or key
jobs were sexually sterotyped. It recited the
plaintiffs' claim that the company maintains male
and female job classificatins within both the
stemmery and the permanent departments. It found
that there are female tag meter operators. male
lin-out and press operators, and forklift opera-
tors, and a predominantly male skeleton crew that
works during the shutdown period of the stemmery.
It found that the prefabrication department
maintained light labor and heavy labor classifica-
tions and that in the fabrication department the
14/ The record suggests very few initial hires
into permanent departments were later employed in
the stemmery.
- 89a -
jobs of head-fixer and fixer are male, while the
jobs of catcher, attendant, examiner, and inspec-
tor are female. It also found that there has never
been a female transfer from the stemmery to the
warehouse, but apparently did not attach any
significance to the fact there has only been one
female hired directly into the warehouse. How or
why such classifications were discriminatory the
district court did not say.
The plaintiffs point out, in addition, that
in one instance there was evidence which tended to
show that the company discouraged a female em-
ployee from transferring to a job as forklift
operator.
The company insists that there was no evi-
dence that any class member ever aplied for and
was denied promotion to any job which her senior-
ity would have entitled her to hold. It also
insists that where was no evidence that in any
significant number of cases, females applied for
jobs but were turned down in favor of junior
maeles. It points out that in one particular job
classification, which the district court had
categorized as female, more than 100 female
- 90a -
employees junior to those in that classification
had bid for and been accepted in jobs paying more
than those of the categorized classification
without a bid by those within the classification,
which evidence tends to indicate, of course, that
any categorization of the job as female had
nothing to do with the company, rather with the
employee's preference, about which the company
could no nothing. The company further insists,
without reply, that from 1966 until 1974 transfers
were governed by a job prefrence system and from
1974 on by job posting and bidding, and that no
nefarious operation of either system by the
company or the union has been pleaded or proved.
The district court did not address these matters.
The district court made few, if any, statis-
tical findings with respect to sexual discrimina-
tion. It did not discuss the theory that an
employee who had sought a job by preference was
not discriminated against by the company. Much in
the same manner as it approached the question of
race discrimination, it found that it was "the
duty and the burden of the defendants to inform
all potential applicants for the various openings
—— Rm °°» —
- 9la -
for said openings as they develop, and that these
openings would be filled withour regard to sex....
"Tt held that "those applicants in the class that
were not so informed and would have applied for
any such openings if informed are entitled to
recoer."
We have not attempted here any detailed
analysis of the evidence with respect to sexual
discrimination principally because the district
court attempted none. If the district court's
findings and recitals are true, there may well be
a case of sexual discrimination. On the other
hand, if the company's contentions, which it
maintains are unrefuted, are true, there may well
not be.
We are of opinion that this is a case in
which "the findings of fact, on which the judgment
was granted, were phrased in broad conclusory
terms and did not include any subsidiary findings
which would give appropriate support to the
court's conclusory findings." United States v.
Commonwealth of Virginia No. 77-1683, 569 F.2d
1300 (4th Cir. 1978). As in EEOC v. United
Virginia Bank-Seaboard National, 555 F.2d 403 (4th
- 92a -
Cir. 1977), the court made no analysis of the
Statistical information or the weight to be
accorded it under the facts advanced by the
defendants. There is here as there as absence of
an critical review of the relevant facts culminat~-
ing in a coherent body of factual findings
which is particularly called for in a discrimina-
tion case. For example, the company insists that
upon employment into the stemmery female employees
were advised of the heavy labor and light labor
categories, and the wages therefor, and given a
chance to indicate a preference for each. This is
not taken account of by the district court, as was
not, as previously recited, the fact that for a
great number of years the company had apparently
operated its transfer system either by main-
tenance of a job perference file or by job posting
and bidding. The mere fact that a company or 4
union may have discriminated on account of sex
before the Civil Rights Act is not enough upon
which to base a finding of liability if present
discrimination is not shown, see Hazelwood School
District v. United States, 433 U.S 299 (1977), and
- 93a -
as with the matter of racial discrimination, the
failure to proclaim innocence is no ground to base
liability upon.
While it may be thought from what we have
said that the failure of the district court to
make the key findings of whether or not women were
hired into the stemmery because of their sex, and
whether their intial job assignments upon hiring
were discriminatory on account of sex, would lead
to a dismissal of claims of the class for failure
of proof, we do not believe that is a proper
disposition of the case. There is enough in the
conclusory findings of the disgrict court to
create a legitimate doubt as to whether or not
discrimination on account of sex existed under the
issues which were agreed to be tried. See Dothard
v. Rawlinson, 433 U.S. 321 (1977).
Accordingly, the judgment of the district
court with respect to sexual discrimination is
vacated and remanded for consideration by the
district court. On remand, the district court
may consider the record before it, and may, within
its discretion, take additional evidence if it be
so advised.
- 94a -
SUMMARY
The judgment of the district court is
vacated, and the case is remanded.
On remand, the district court will dismiss
the allegations of the complaint based on employ-
ment discrimination on account of race; those
allegarions of the complaint based on sexual
discrimination will be the subject of reconsidera-
tion not inconsistent with this opinion.
While the opinion of the district court found
for the unions on the issue of whether they had
fairly represented their members, see 29 (U.S.C.
§195(a), no order has been encered giving effect
to that part of the opinion. We presume an order
with respect to this issue will be entered on
remand.
Following reconsideration of the case, the
district court will reconsider its award of
attorney's fees.
Vacated and Remanded.
- 95a -
IN UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
Nos. 76-1998-1999
76-2199
NORA LEWIS, et al.,
Appellees,
=-vs -
PHILIP MORRIS, INCORPORATED, et al.,
Appellants.
ORDER
No request for a poll of the .2surt on the
suggestion for rehearing en banc having been made,
rehearing en banc shall be, and hereby is, denied.
The panel has considered the petition for re-
hearing and is of opinion it is without merit.
It is accordingly ADJUDGED, and ORDERED that
the petition for rehearing shall be, and the same
hereby is, denied.
With the concurrences of Judge Russell and
Judge Hall.
/s/H.E. Widener
For The Court
Filed: July 26, 1978
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