Petition — Firefighters v. Stotts

82-206 er ise

FILED

AUG 4 1982

ALEXANDER L. STEVAS,

RK

ey

No. 82-

In the Supreme Court of the United States

October Term, 1982

FIREFIGHTERS LOCAL UNION NO. 1784,

Petitioner,

VS.

CARL W. STOTTS, et al.,

Respondents.

PETITION FOR WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

J. ALAN HANOVER

(Counsel of Record )

ALLEN S. BLAIR

JAMEs R. Newsom III

HANOVER, WALSH, JALENAK & BLAIR

219 Adams Avenue

Memphis, Tennessee 38103

(901) 526-0621

Counsel for Petitioner

E. L. Mewpewnatt, Ivc., 926 Cherry Street, Kansas City, Mo. 64106, (816) 421-8080

QUESTION PRESENTED

Whether a district court has the authority to modify

a consent decree, silent in regard to layoffs, in such a man-

ner that a bona fide seniority system calling for layoff by

seniority is abrogated, in an action where there has been

no adjudication of discrimination by the employer or the

union.

LIST OF PARTIES

Petitioner Firefighters Local Union No. 1784 inter-

vened in the district court and appeared as an appellant

in Court of Appeals Nos. 81-5348 and 81-5349. Memphis

Fire Department, Robert W. Walker, City of Memphis

and Joseph Sabatini were also appellants below and have

filed a separate petition contemporz ieously herewith.

Carl W. Stotts, individually and as a class representative

on behalf of all others similarly situated and Fred L. Jones

appeared as appellees in Court of Appeals Nos. 81-5348

and 81-5349, respectively.

TABLE OF CONTENTS

Question Presented ...... siegsitiaidilinta aaah lichen ae I

eee PERRO SO) FER, rt SM II

IID on coccshsssstcuntepsunioseteanreeihis salen -dihiicmsaniiusiiiads l

EE a IN RE 2

I 2

ECMO LE AIA 2

Reasons for Granting the Writ—

1. An Important Issue Is Presented Concerning

the Extent of a District Court’s Authority to

Modify a Consent Decree in a Title VII Case... 6

2. The Rationale of the Court of Appeals Under-

mines the Incentives for Settlement of Em-

ployment Discrimination Litigation —................. 9

EES SP On OR ee ne NE AW or 12

Appendix—

Opinion of the Court of Appeals 2.000000... App. 1

Oral Ruling of the District Court ........000.......... App. 72

Order of the District Court 20000000000 App. 77

Memorandum of Understanding between City of

Memphis, Tennessee and Firefighters Local

Union No. 1784, 1975-1978 (Article XIX) .....App. 80

Relevant Statutory Provision 2000000000000... App. 82

TABLE OF AUTHORITIES

Cases

American Tobacco Co. v. Patterson, ........ ee , 102

ck cochulintunsiioaiedoiasindlia 7,8

Boston Chapter NAACP v. Beecher, ........ F.2d ........ , 28

FEP Cases 1657 (1st Cir. 1982) ................. aikinaieiaadmadaa 6,7

International Brotherhood of Teamsters v. United

eB ees res 6-7

James v. Stockham Valves & Fittings Co., 559 F.2d 310

I ae 9

Pullman-Standard v. Swint, ........ US. ......... 102 §.Ct.

SI telecine deh iata eee 7,9

Stotts v. Memphis Fire Department, 679 F.2d 541 (6th

I a ll 1, 2, 6,9

Trans World Airlines, Inc. v. Hardison, 432 U.S. 63

Eee sihicchinjeniieeecsiealnaiinieitenaiaidiiiasicibiasaiamaiae ae 8

United Airlines, Inc. v. Evans, 431 U.S. 553 (1977) ........ 7

United States v. Miam, 664 F.2d 435 (5th Cir. 1981) ... 12

United States v. Swift & Co., 286 U.S. 106 (1932) .......... 6

United States v. United Shoe Corp., 391 U.S. 244 (1968) 6

Statutes

I, SD i esielinebaemcbihaseniiaces 2

$703(h) of Title VII of the Civil Rights Act of 1964.

rt, MID... caccnsssseanedeseineinniians 2, 6, 7, 8, 12

0 one ee Peed 2

No. 82-

In the Supreme Court of the United States

October Term, 1982

FIREFIGHTERS LOCAL UNION NO. 1784,

Petitioner,

Vs.

CARL W. STOTTS, et al.,

Respondents.

PETITION FOR WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

Firefighters Local Union No. 1784, intervenor-defen-

dant in the district court, prays that a writ of certiorari

issue to review the judgment and opinion of the United

States Court of Appeals for the Sixth Circuit in Stotts v.

Memphis Fire Department (6th Cir. Nos. 81-5348 and 81-

5349, May 7, 1982).

OPINIONS BELOW

The judgment and opinion of the court of appeals of

which review is sought is reported officially at 679 F.2d

541. It is unofficially reported at 28 Fair Employment

Practice Cases 1491. The opinion is set forth in the ap-

pendix to this petition at App. 1. The oral ruling of the

district court, not reported, is reproduced in the appendix

hereto at App. 72. The judgment and order of the district

court, not reported, is reproduced in the appendix to this

petition at App. 77.

JURISDICTION

The order of the Court of Appeals for the Sixth Cir-

cuit was entered on May 7, 1982. The jurisdiction of this

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

STATUTE INVOLVED

The statutory provision involved, §703(h) of Title VII

of the Civil Rights Act of 1964, 42 U.S.C. §2000e-2(h), is

set forth in the appendix beginning at App. 82.

STATEMENT OF THE CASE

These cases originally arose out of a controversy con-

cerning the employment practices of the City of Memphis

Fire Department. On February 16, 1977, Carl W. Stotts,

a male black employee of the Department filed a class ac-

tion lawsuit pursuant to Title VII of the Civil Rights Act

of 1964, as amended, 42 U.S.C. §§2000e, et seq., and pursuant

to 42 U.S.C. §§1981 and 1983. The complaint alleged that

the Department maintained racially discriminatory hiring

and promotional practices.’

At the time the Stotts case was filed, a prior consent

decree had been approved and entered by the district court

in 1974 in the context of a civil rights action brought

against the City by the United States* The 1974 Decree,

inter alia: (1) set forth general long-term goals for the

1. This action was later consolidated on September 18, 1979

with a similar case brought by Fred L. Jones alleging racially

discriminatory promotional policies on the part of the Department.

2. The 1974 Decree is reproduced in part in the

to the opinion of the court of appeals (App. at 52-58). 1980

Decree is reproduced in full in the opinion of the court of ap-

3

hiring of minority employees in all City divisions (App. at

55, 13); (2) made no adjudication of discrimination against

the City (App. at 53); (3) contained a denial by the City

that it had previously engaged in any pattern or practice of

discrimination in hiring or promotion on the basis of race

or sex (App. at 53); (4) provided that total or City-wide

seniority of the employees should be considered for pur-

poses of promotion, transfer and assignment (App. at 56,

16); and (5) stated that implementation of its goals was

“subject to the anticipated budgeted vacancies in the

City.”* The 1974 Decree did not address layoffs, reduction

in rank and recall rights and contains no award of retro-

active or “constructive” seniority.

3. The 1974 Decree provides as follows at paragraph 10

thereof:

10. Subject to the availability of qualified applicants,

the City will establish and attempt to achieve from the date

of this decree through June 30, 1976, the following goals: An

interim goal of increasing the level of black employment

in uniform positions in the Fire Division by five (5) per cent

of the total uniformed personnel; an interim goal of increas-

ing the level of black employment in the Police Division by

seven (7) per cent of the total uniformed personnel, and an

interim goal of increasing the level of female employment

in uniformed positions in the Police Division (ot r than

parking meter patrol) by between four (4) and five (5)

per cent of total uniformed personnel, it being understood

that a female black employee counts in both percentages.

All of said goals are subject to the anticipated budgeted

vacancies in the City. The Fire and Police Divisions shall

be reviewed at the close of the initial period as specified

abcve and goals for succeeding periods will be established

which will be based on filling anticipated vacancies in these

divisions with black and female personnel in approximately

the same manner as in the initial period. No specific nu-

merical ratio for employment of black or female patrol of-

ficers or black fire fighters shall be established unless the

City fails in its good faith attempt to meet | A interim goals

established pursuant to this paragraph. The question of

goals for female fire fighters will be reviewed by the parties

at the end of the initial period.

paragraph and pesqpreree 3 through 23 of the 1974 De-

10 bears upon the matter of “economic hardship i.

4

The original parties to Stotts agreed to a consent de-

cree that was approved by the district court on May 16,

1980. The 1974 Decree provided the framework upon which

the 1980 Decree was constructed. The 1980 Decree inter

alia: (1) adopted the general long-term minority hiring

goal provided in the 1974 Decree and additionally provided

for interim minority hiring goals (App. at 64, 96); (2)

made no adjudication of discrimination against the City;

(3) contained no admission of any violation of law by the

City ‘App. at 60); (4) stated that it was not intended to

conflict with any provisions of the 1974 Decree, but was

intended to “parallel and supplement” the relief therein

provided (App. at 60) and (5) contained a waiver of the

right to seek further relief except to enforce the provisions

of the decree (App. at 61). The 1980 Decree, like the 1974

Decree, was silent with respect to layoffs or reduction in

rank. The district court retained jurisdiction to effectuate

the purposes of the 1980 Decree (App. at 69, {17).

The immediate controversy crystallized in May, 1981

following the City’s announcement of a proposed operating

budget that provided for a reduction in personnel in all

divisions. The City also announced a Layoff Policy which

was based upon a seniority system founded upon length of

service with the City. The city-wide seniority system in-

voked by the Layoff Policy was adopted by the City as a

formal employment practice in 1973, is referred to in the

1974 Decree, and was incorporated into the City’s labor

memoranda with Firefighters Local Union No. 1784 in 1975

(App. at 80) and has remained a part of succeeding memo-

randa.

On May 4, 1981, Stotts applied for and obtained a

temporary restraining order from the district court re-

straining the City from laying off or reducing in rank

any black employee of the Department. The Union in-

tervened in this litigation for the first time by consent of

the parties on May 5, 1981, to protect the seniority system.

An evidentiary hearing on Stotts’ request for a preliminary

injunction was held by the district court on May 8, 1981.

At the close of the hearing, the district court found

that neither the 1974 Decree nor the 1980 Decree con-

templated a method to be used for layoffs or reduction

in rank (App. at 73). However, the court held that it

did possess the authority to modify the 1980 Decree by

enjoining the City from applying the proposed Layoff Pol-

icy based on city-wide seniority insofar as it would decrease

the percentage of minority employees in certain ranks

within the Department (App. at 75). With respect to

the Layoff Policy and seniority system, the district court

made this finding:

I do find that the adoption of this layoff policy was

not adopted with the intent or specific purpose to

discriminate against black, and I find no reason -

well, neither the layoff nor the policy adopted was

intended to be discriminatory. However, I find it

inescapable that the effect is discriminatory. (App.

at 73)

However, because the effect of that, and the proposed

system is in effect discriminatory, I find that such

a position is not a bona iide seniority system. (App.

at 74)

Judgment on the district court’s ruling was entered

on May 18, 1981 (App. at 77). The Union and the City

timely noticed their appeals on the same day. On May

7, 1982, the court of appeals affirmed the district court.

Although finding that the district court had erred in ruling

that the seniority system was non-bona fide, the court

of appeals held that the district court did not abuse its

discretion in modifying the 1980 Decree.

REASONS FOR GRANTING THE WRIT

1. An Important Issue Is Presented Concerning the

Extent of a District Court’s Authority to Modify

a Consent Decree in a Title VII Case.

The decision of the court of appeals decides an im-

portant question of federal law which has not been but

should be decided by this Honorable Court. Despite the

“special treatment” afforded to seniority systems by §703

(h) of Title VII of the Civil Rights Act of 1964, the courts

below have abrogated a bona fide seniority system pro-

tected by §703(h). Im reality, the courts below have

violated one section of Title VII to remedy alleged vio-

lations of Title VII.

Crucial to the Stotts opinion, like the recent opinion

of the First Circuit in Boston Chapter NAACP v. Beecher,

Siteis F.2d ....... 28 FEP Cases 1657 (lst Cir. 1982), is

the conclusion that a district court has the authority, pur-

suant to its equitable jurisdiction, to modify consent de-

crees in Title VII cases in order to meet previously un-

anticipated circumstances. The court of appeals draws

its rationale in large part from decisional authority of

this Court developed in the context of antitrust litigation.

See United States v. United Shoe Corp., 391 US. 244

(1968); United States v. Swift & Co., 286 U.S. 106 (1932).

This authority is distinguishable because those cases did

not involve situations where a district court’s authority to

modify was limited by a congressionally mandated exemp-

tion to the law’s application. The instant cases do.

Specifically, $703(h) of the Civil Rights Act of 1964,

42 U.S.C. §2000e-2(h) immunizes bona fide seniority sys-

tems from challenge under Title VII, even where such

systems operate to perpetuate the effects of discrimination.

International Brotherhood of Teamsters v. United States,

7

431 U.S. 324 (1977); United Airlines, Inc. v. Evans, 431

U.S. 553 (1977). Pursuant to §703(h), a showing of dis-

parate impact is insufficient to invalidate a seniority sys-

tem. A discriminatory purpose must be proven, requiring

a trial on the issue of discriminatory intent. Pullman-

Standard v. Swint, .... US. ....., 102 S.Ct. 1781, 1784

(1982).

The district court's finding that the seniority system

was non-bona fide was vacated by the court of appeals

as being in conflict with prior authority of this Court

(App. at 11 n.6; 41). No discriminatory purpose was

proven. There has been no adjudication of discrimination

against the City, the Department or the Union in this

litigation or its antecedent. Compare, Boston Chapter

NAACP v. Beecher, ..... F.2d ....., 28 FEP Cases 1657

(1st Cir. 1982). Yet, the courts below chose to ignore

the protection that §703(h) afforded to the seniority sys-

tem in question. In fact, tnose courts violated §703(h)

by ignoring it and granting plaintiffs relief which abro-

gated the system.

Neither the broad remedial nature of Title VII nor

the broad discretion conferred to the district court in ad-

ministering consent decrees can justify the orders below.

This Court has concluded that §703(h) imposes significant

restraints upon the authority of district courts to set aside

seniority systems in effectuating affirmative relief. See

American Tobacco Co. v. Patterson, ........ a

S.Ct. 1534, 1541 (1982). The court of appeals has failed

to provide convincing reasons why the dictates of §703(h)

should be ignored when providing similar affirmative relief

by modifying a consent decree, particularly where there

has been no adjudication of discrimination. Though the

court of appeals mimics the previous rulings of this Court,

it fails to apply their substance.

8

The court of appeals insists that the district court

acted within the limits of its broad equitable discretion

in administering consent decrees, as a result of the changed

circumstances occasioned by the proposed layoffs (App.

at 31-32, 35-37).* Yet the court offers no cogent explana-

tion why the authority of the district court to modify

the consent decree is not limited by §703(h).

The decisional authority of this Court has emphasized

that seniority systems are afforded “special treatment”

under Title VII itself. Trans World Airlines, Inc. v. Hardi-

son, 432 U.S. 63, 81 (1977). The court of appeals makes

no mention of the importance which Congress and this

Court have accorded to seniority systems and collective

bargaining. See Patterson, 102 S.Ct. at 1541 n.17 (1982).

As this Court has stated, in a proper circumstance, an

appropriate remedy for adoption of a discriminatory senior-

ity system might likely include an injunction against the

application of the system. “Such an injunction, however,

would lie only if the requirement of §703(h) - that

such application be intentionally discriminatory - were

satisfied.” Id. at 1538.

4. The court of appeals finds applicable two of the three

grounds on which consent decrees generally may be modified

(App. at 31-37). In addition to finding that the district court

acted within its “equitable discretion,” the court also proffers a

contractual interpretation rationale. The Court unabashedly

ignores relevant provisions of the two consent decrees in finding

that the district court’s modification was in accordance with

“basic contract principles” (App. at 31, 32-34). The decrees did

no more than mandate performance expectations in the areas of

hiring and promotions, if hiring and promotions were made. They

required neither hiring nor promotions to be made. T’ e° proposed

Layoff Policy did not repudiate the City’s responsibilities in either

area. Also, the decrees acknowledge that the implementation of

their terms is subject to budgetary restrictions (See note 3, supra);

that seniority is a legitimate consideration in employment decisions

by the City (App. at 56, 16); and that any further relief is waived

except to the extent necessary to enforce the provisions of the

decrees (App. at 61). The court of appeals fails to engage in an

a eee © See Se Se ee

contractual SS n fact, F court of appeals’

cision is in all respects a aed ted decision.

9

The injunction of the district court modifying the 1980

Decree was not applied in a proper context. As the court

of appeals acknowledged, “the layoff policy was not

adopted with a discriminatery purpose.” (App. at 11 n.6).

Neither has there been an adjudication that the seniority

system is not neutral; that it is irrational in light of general

practice; that the system had its genesis in racial discrim-

ination; or that the system was negotiated and maintained

without freedom from any illegal purposes. See Swint,

102 S.Ct. at 1784, 1785; James v. Stockham Valves &

Fittings Co., 559 F 2d 310 (5th Cir. 1977).

Not only is there no proof in the record indicating

that the seniority system herein is non-bona fide, neither

is there any previous adjudication of intentiona] discrim-

ination in the record with regards to the City, the Depart-

ment or the Union which might lead to an inference of

intentional discrimination. What is apparent is that the

courts below - purportedly acting pursuant to their equi-

table jurisdiction to effectuate the purposes of Title VII -

have exceeded their authority under Title VII by violating

Title VII in the name of remedying alleged violations of that

statute. This practice ignores relevant provisions of the

very statute which the court of appeals purports to uphold.

The decision of the court of appeals must not be permitted

to stand.

2. The Rationale of the Court of Appeals Undermines

the Incentives for Settlement of Employment Dis-

crimination Litigation.

The decision of the court of appeals places in consider-

able jeopardy the prospect for settlement of future Title

VII cases. It does so by removing the incentives for settle-

ment. Should the Stotts opinion stand, employers and

unions in the future will view it as a signal that consent

10

decrees in Title VII cases render unto district courts un-

limited authority to confer relief to plaintiffs beyond the

negotiated parameters of the decrees upon the outset of

unanticipated circumstances. In effect, no one will be

certain that the settlement agreed to will be the settlement

implemented in the long run. As a result, it can be rea-

sonably anticipated that employers shall become reluctant

to settle and unions shall step forward to object to the

entry of consent decrees even when their interests are

not obviously implicated.

The approach of the court of appeals is that the parties

to an employment discrimination suit, and even non-par-

ties, relinquish the right to litigate all possible issues, even

issues unforeseen, once a consent decree is entered (App.

at 24). While plaintiffs forego the possibility of receiving

such relief as back pay and promotions which they might

obtain if they prove their allegations, defendants are said

by the court of appeals to relinquish “the right to rebut the

allegations of discrimination” contained in the plaintiffs’

complaint and to “avoid the affirmative responsibilities im-

posed by a judicial finding of discrimination.” (App. at

24). The district court is conferred the authority to po-

lice the implementation of the decree, including the power

to require specific performance of its terms, even if eco-

nomic hardship ensues (App. at 24, 32-33). The court of

appeals holds that the district court’s policing authority

encompasses the power to modify the decree upon changed

circumstances to effectuate the purposes of the decree.

However, what the court of appeals has allowed the district

court to do herein is to completely disregard the law and

the congressional mandate behind the law as to seniority

systems, regarding an issue not addressed in the plead-

ings and orders in the case, in the name of policing the

consent decree. Rather than eliminating the uncertain-

ties of litigation, this approach imposes upon parties and

11

even upon nonparties the threat of continuing uncer-

tainties. This result is clearly illustrated by the instant

case.

Importantly, the 1974 Decree makes no adjudication of

discrimination (App. at 53). The 1974 Decree contains

evidence that the City did not relinquish its right to rebut

the allegations of discrimination made against it. The City

expressly denied in the 1974 Decree itself that it had previ-

ously engaged in any pattern or practice of discrimination

in hiring or promotion on the basis of race or sex (App.

at 53). The 1974 Decree conditioned implementation upon

the existence of “anticipated budgeted vacancies” (see

note 3). The language of the 1974 Decree did not give

the Union cause for concern that the city-wide seniority

system then in effect would be compromised; to the con-

trary, the 1974 Decree endorses the system (App. at 56, 16).

The 1980 Decree also makes no adjudication of dis-

crimination, nor does it contain an admission of discrim-

ination (App. at 60). As the 1980 Decree supplements and

parallels the 1974 Decree (App. at 60), the City’s denial of

intentional discrimination in the 1974 Decree is equally

applicable thereto as is the provision concerning condi-

tional implementation (see App. at 53; note 3). In stark

contrast to the approach of the court of appeals, the 1980

Decree contains a waiver of the plaintiffs’ right to seek

further relief except to enforce the ‘‘four corners” of the

decree (App. at 61). Again, the Union was not placed

on notice by the 1980 Decree that its collectively-bargained

seniority system could be abrogated upon the advent of

changed circumstances.

The approach of the court of appeals is fundamentally

at odds with the understanding of the parties as reflected

in the decrees at issue herein. Rather than encouraging

compromise and settlement, the approach of the court of

12

appeals fosters uncertainties that reduce the incentive of

employers to settle employment discrimination litigation

and increase the likelihood of challenges from concerned

third parties, particularly labor unions, that would neces-

sitate a trial on the merits. See, e.g., United States v.

Miami, 664 F.2d 435 (5th Cir. 1981).

CONCLUSION

The issue presented by this petition is certain to recur.

The court of appeals has simpiy ignored the congressional

mandate of §703(h) and the authorities of this Court in-

terpreting that statutory provision. The Court should

grant a writ of certiorari to ensure consistency of statutory

interpretation and implementation and to avoid irreparable

damage to the incentives for defendants to settle employ-

ment discrimination cases.

For these reasons, a writ of certiorari should issue to

review the judgment and opinion of the United States

Court of Appeals for the Sixth Circuit.

Respectfully submitted,

J. ALAN HANOVER

(Counsel of Record)

ALLEN S. BLAIR

JAMES R. Newsom III

HANOVER, WALSH, JALENAK & BLAIR

219 Adams Avenue

Memphis, Tennessee 38103

(901) 526-0621

Counsel for Petitioner

Al

APPENDIX

Nos. 81-5348-9

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

Cart. W. Storrs, Individually and on |

behalf of all others similarly situ-

ated,

Plaintiffs-Appellees,

and

Frep L. Jones,

Plaintiff-Appellee,| ON Arpeat from the

United States District

Court for the West-

Mempuis Free DePpanTMENT; Rosert| ¢™ District of Ten-

W. Wa xxer, City oF Mempuis, and| messee.

Joseru SABATINI,

Defendants-Appellants,

Vv.

and

Frrericnters Locat Union 1784,

Defendant-Intervenor-Appellant.

Decided and Filed May 7, 1982.

Before: KerrH and Mantin, Circuit Judges and Duncan.*

Kertn, Circuit Judge, delivered the opinion of the court,

in which Duncan, Circuit Judge, joined. Manrtix, Circuit

Judge (pp. 46-51), delivered a separate epuien, concurring

and dissenting in part.

* Hon. Robert M. Duncan, U.S. District Court for the Southern

District of Ohio, sitting by designation.

A2

Kertn, Circuit Judge. This case presents questions regard-

ing the entry and modification of a consent decree in an

employment discrimination case. In 1977, Plaintiff-appellee

Carl Stotts filed a class action against the City of Memphis,

alleging that the Fire Department's hiring and promotion

policies were racially discriminatory. After three years of

discovery and intensive negotiations, the Stotts suit was settled

by a consent decree in 1980 (“1980 Decree”). No trial was

held. The 1980 Decree was intended to supplement an

earlier consent decree entered in 1974 which affected em-

ployment practices in al) divisions of the Memphis city gov-

ernment. The 1980 Decree provides for back-pay awards and

an affirmative action plan containing specific hiring and pro-

motion goals. The decree does not specifically address the

effect layoffs would have on these affirmative action goals.

In 1981, the City of Memphis announced that city-wide

layoffs were necessary to alleviate an unanticipated economic

crisis. The proposed layoffs in the Fire Department threat-

ened to frustrate the purpose of the decrees and the progress

accomplished under them. Minority employment in the Fire

Department would have been devastated by the proposed

layoffs. Plaintiff Stotts filed a motion to restrain the City of

Memphis from implementing the layoff proposal in a manner

which affected minority firemen. The district court found

that the proposed layoffs were an unanticipated change in

circumstance not contemplated by the consent decrees. Ac-

cordingly, the court modified the decrees and enjoined the

proposed layoffs and demotions of minority firemen. We

affirm.

A3

I. FACTS

In 1974, the United States Department of Justice (“Gov-

ernment”) instituted an action against the City of Memphis

(“City”) under Title VII, 42 U.S.C. § 2000e et seq., 42 U.S.C.

§ 1981,' the Fourteenth Amendment, and the State and Local

Fiscal Assistance Act of 1972, 3i U.S.C. § 122) et seq. The

complaint alleged that the Fire Department and various other

City divisions had engaged in a pattern or practice of race

and sex discrimination in hiring and promotions. The City

initially denied the allegations. Later in 1974, however, it

agreed to settle the litigation with a consent decree (“1974

Decree” ).?

The motivation for the 1974 Decree was the desire to

remedy past discrimination and avoid the delay and expense

of further litigation. In the decree, the City did not admit

to any misconduct. The City did acknowledge, however,

that its employment practices may create an inference of

racial and sexual discrimination.

The purpose of the 1974 Decree is to remedy any disad-

vantage to blacks and women which may have resulted from

past discrimination. Subject only to the availability of qual-

ified applicants, the City agreed to undertake the “goal of

achieving throughout the work force proportions of minority

and female employees in each job classification approximating

their respective proportions in the civilian labor force.” The

decree established interim hiring goals for each of the City’s

divisions. The interim goal affecting the Fire Department

required that minority employment in the uniformed positions

1§ 1981 provides:

on wate Se ay any of the Lah tes shall

ve same rig Ty ~y Territory ma

enforce contracts, to sue, be parties, give evidence, and

Tyal Tyg Bap hy Xa

of and propert is b citizens

shall be subject to like ‘punishment pain, ties, taxes,

licenses, and exactions of every kind, and to 1,

2 See appendix page 1.

A4

increase by 5% before July of 1976. The decree also required

the City to “engage in affirmative recruitment activities con-

sistent with their obligation to take all reasonable steps to

reach the goals set forth” in the decree. Specific numerical

hiring ratios would be established if the City failed in its

good faith attempt to meet the interim hiring goal.

The 1974 Decree did not establish specific minority employ-

ment goals for the ranks above firefighter. However, the

decree acknowledged the need to increase substantially the

number of minorities in supervisory positions. In fact, the

decree committed the City to “making significant progress in

increasing the number of black and female supervisory per-

sonnel.” Numerical promotional goals could be imposed if

the City’s performance during the preceding fiscal year did

not satisfy its obligations under the decree.

On February 16, 1977, Carl Stotts, plaintiff-appellee, filed

a class action suit against the Memphis Fire Department. His

complaint alleged that the Fire Department's hiring and pro-

motion policies violated Title VII, 42 U.S.C. § 2000e et seq.,

42 U.S.C. § 1981, and 42 U.S.C. § 1983.3

The Pioneers, a group of approximately 70 minority Mem-

phis firemen, filed a motion to intervene in the Stotts case.

The trial court denied the Pioneers’ motion to intervene, but

certified the case as a class action. During the following

months, the Stotts case received extensive attention in the

local media. The press coverace included several articles

describing the Stotts case and its effect on the Fire Depart-

ment.

34$1983 provides:

Every person ~vho, under color of any statute, ordinance,

or causes to be subjected, any citizen of the ‘States or

other person within the ju thereof to the deprivation

of any rights, privileges, or immunities secured by the Consti-

A5

On June 19, 1979, Fred Jones, plaintiff-appellee, filed an

action against the City, alleging that the Fire Department

had denied him a promotion solely because of his race. The

Jones and Stotts cases were consolidated in September. On

September 27, District Judge McRae set a trial date for the

Stotts case but, nonetheless, encouraged the parties to settle

the action.

In December, Plaintiffs-appeliees Stotts and Jones (“Plain-

tiffs”) filed a motion for a temporary restraining order

(“TRO”) to enjoin the City from making promotions within

the Fire Prevention Bureau. The Plaintiffs stated they would

be irreparably harmed if the scheduled promotions occurred.

As proposed, the promotions would fill certain positions and

prevent minorities from acquiring the experience necessary to

qualify them for supervisory positions. The City opposed the

motion, arguing that the promotions were necessary for the

efficient operation of the Fire Department. The creation

of acting or temporary positions would create instability with-

in the department. The City stated emphatically, “We do

need to make the promotions.” The trial court granted the

TRO after finding that, “there would be irreparable harm if

promotions were granted that were not consistent with the

rights of the plaintiffs.”

On January 17, 1980, the City appeared before Judge

McRae and stated that scttlement negotiations were contin-

ui g. On February 20, 1980, both the City and Plaintiffs

appeared before the court and stated that the settlement was

complete “except for about five different things.” Five days

later, the parties again appcared before the court and stated

that negotiations concerning the settlement were continuing

despite some difficulties concerning the affirmative relief and

monitoring sections of the proposed settlement.

Finally, on April 25, 1980, the parties announced that they

had reached a settlement. The settlement consisted of an

affirmative action plan embodied in the 1980 Decree. The

1980 Decree contained hiring and promotion goals. The

15 days in the Memphis Fire Stations for comment. Counsel

also stated that he thought the Firefighters Local Union 1784

(“Firefighters Union”) might object to the decree.

The purpose of the 1980 Decree was to remedy the past

hiring and promotions practices of the Memphis Fire Depart-

ment relative to minorities. The 1980 Decree was intended

to parallel and supplement the relief provided in the 1974

Decree. The decree reaffirmed the City’s commitment to

achieve the long-term goal of increasing minority representa-

tion in each job classification to levels approximating the level

of minority representation in the Shelby County labor force.

The 1980 Decree also established specific hiring and promo-

tion goals. The hiring goal stated that qualified minorities

should fill at least 50% of all vacancies. The promotional goal

indicated that qualified minorities should receive 20% of the

vacancies. The promotional goal was adopted to “insure as

quickly as practicable the attainment of [the] long range

goal.” Back pay in the amount of $60,000 was also awarded

to class members in varying amounts according to their length

of service. In addition, the decree required the trial court to

retain jurisdiction to make “such further orders as may be

necessary or appropriate to effectuate the purposes of this

decree.”

Neither the Firefighters Union nor any class member filed

an objection to the decree during the 15 day period. On

May 12, 1980, however, a group of eleven non-minority fire-

men objected to the entry of the 1980 Decree and filed a

motion to intervene. These proposed intervenors filed on

behalf of themselves and allegedly all other non-minority

firemen. The non-minority firemen were not, however, repre-

sentatives of the Firefighters Union, the union representative

of Memphis firemen.

A7

The non-minoritics asserted that the promotional goals con-

tained in the 1980 Decree operated as “reverse discrimination

against the non-minorities.” The non-minorities also asserted

that less burdensome alternative relief for minority employees

was available which did not shift discrimination to non-

minority employees. These alternatives included the creation

of additional positions for promotion, organizational restruc-

turing of the Memphis Fire Department, constructive promo-

tion,* and the payment of monetary damages to non-minority

employees affected by the decree.

On May 16, 1980, the court held a hearing. The court

heard objections to the 1980 Decree and the motion to inter-

vene. No class member filed an objection to the decree. The

proposed intervenors indicated that the only immediate re-

lief they sought was a delay in the approval of the promo-

tion section of the decree. Allegedly, additional discovery

and expert statistical analysis were necessary before concrete

alternative remedies for the past discrimination minorities ex-

perienced could be presented. The proposed intervenors’

position was that the decree should not have any affect on

the promotional opportunities of incumbent employees. The

proposed intervenors did not argue that the relief provided

in the 1980 Decree unduly burdened a readily identifiable,

small group of incumbent employees. Nor did the proposed

The court denied the proposed intervenors’ motior to inter-

vene after finding that the proposed intervenors adopted a

“wait-and-see” approach to the litigation. The alternatives

suggested by the proposed intervenors were also considered

and rejected. Continuation of the TRO would unduly hamper

the functioning of the Fire Department. The court also

A8

opined that it could take judicial notice that the City’s past

employment practices were racially discriminatory based on

evidence contained in the record. Ultimately, the court deter-

mined that the 1980 Decree was “reasonable”.

On May 4, 1981, Joseph Sabatini, Director of Personnel for

the City, publicly announced a personnel reduction in non-

essential services in all divisions of the City government.

The proposed layoffs were the first in the City’s history. The

City’s layoff policy was based on an individual's city-wide

union seniority, that is, the length of his tenure as a city

employee. The seniority system was mentioned in the 1974

Decree and is incorporated in the City’s memorandum of

understanding with the Union.

A deficit in the City’s projected operating budget prompted

the proposed layoffs. The deficit was caused by an unan-

ticipated decrease in the general revenue funds from the

1980-81 fiscal year and an increase in operating costs. Plain-

tiffs were not given an opportunity to review the City’s layoff

policy before it was announced publicly. The Mayor had

ultimate authority to determine which job classifications within

the city government were affected by the new layoff policy.

On May 4, 1981, Plaintiffs obtained a TRO restraining the

City from laying off or reducing in rank any minority em-

ployee in the Memphis Fire Department. The parties con-

sented to the intervention of the Firefighters Union in the

Stotts case the next day.

An evidentiary hearing was held on May 8 to consider

Plaintiffs’ request for a preliminary injunction. The court

made severa) determinations. First, the announced layoffs

and demotions were an unanticipated changed circumstance

not provided for in the text of the decree. Second, the 1980

Decree was designed to correct the effects of the City’s hiring

and promotion practices Finally, the court concluded that

the proposed layoffs would have a devastating and retrogres-

sive effect on minority employment and the affirmative action

accoinplished pursuant to the consent decrees. Most minori-

Ag

ties above the rank of private had accrued little seniority in

their respective ranks. Consequently, nearly 60% of all fire-

men affected by the demotions would have been minorities.

Moreover, fifty-five percent of all minority Lieutenants and

46% of all minority Drivers would either have been laid off

or demoted if the announced layoffs had occurred.

Based on this and other evidence in the record,’ the court

5 Between 1950 and 1976, the Memphis Fire Department hired 94

black and 1683 white firemen. Promotions within the Fire Depart-

ment between the years of 1969 and 1975 were as follows:

MEMPHIS FIRE DEPARTMENT PROMOTIONS

1969 Black White

Lieutenant 1 17

1970 Black White

Driver 1 60

1971 Black White

Driver 1 13

Lieutenant 0 15

Captain 0 1

1972 Black White

Drivers 2 128

Lieutenant 1 57

Investigator — Lieutenant 0 6

Captain 0 2

1973 Black White

Investigator — Captain 0 5

Captain 0 3

Emergency Unit — Lieutenant 0 4

1974 Black White

Driver 1 39

Lieutenant 0 21

1975 Biack White

Driver 0 8

Lieutenant 0 5

Captain 0 2

In 19798, blacks constituted between 33 ard 37 percent of the

was only 10

Al0

Il.

Total

APPARATUS MAINTENANCE

Vehicle Serviceman

Preventive Maintenance

Fire Maintenance Mechanic

District Chief

Total

MATERIAL SERVICES

Storage Keeper

Crewman

Building Maintenance

Supervisor

Manager

:

:

~

——wnwl es

All

ruled that the layoff policy would have a discriminatory impact

and the seniority system was non-bona fide. Subsequently,

the court modified the consent decree to minimize the disrup-

BLACK WHITE

Vil. FIRE PREVENTION

Home Fire Safety Representative

Parts Assistant

Master Plans Coordinator

Fire \nspector

Fire Investigator

anager

Tiss Vevention Supervisor

Fine Safety Ed. Coord.

Deputy Fire Marshall

Assistant Fire Marsha!)

Fire Marshall

Total

VIIlL. FIRE FIGHTING

Fire Private I

Fire Private II

ed ed tad

os | cooooowroow

oe

tain

Air Crash Chief

District Chief

Deputy Chief

Total

IX. AMBULANCE SERVICE

Emergency Unit Operator

Emer, Unit Lieutenant

District

Total 7

(As of May 8, 1981)

In Teamsters, supra, the Supreme Court stated statistics indicating

racial imbalance are often “a telliale sign of purposeful discrimina-

tion.” It is ordinarily qupested that nondiscriminatory hiring prac-

tices will in time result in a workforce more or less A 3-0

of the racial composition of the city. Id. at 340, n.20. in Ge comns

of 1981, blacks constituted only 11 percent of the Memphis Fire

A ly 35 percent of the City of Memphis is

7

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as

a

coon hClm

~

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black. The sta contained in this record represent @ very strong

prima facie case of employment discrimination.

@The district court erred in ruling that the seniority system was

non-bona fide. The district court found that the policy was

—,. Ek ety | - bine By tery

been appeal. aylor v. Mueller

1122 (6th Cir, 1981)” The district court did find that the layoffs

Al2

tive effect the layoffs would have on the efforts to achieve the

goals of the decree. The court enjoined the City from

applying the layoff policy based on seniority insofar as it

would decrease the percentage of black Lieutena.its, Drivers,

Inspectors, and Privates employed in the Memphis Fire De-

partment. The City and the Union appealed.

On June 22, 1981, Plaintiffs filed a motion requesting the

court to enjoin the proposed layoffs and demotions of minority

employees in five additional positions. After a hearing on

the motion, the court expanded the preliminary injunction to

include three of the five positions.

Both the City and the Union filed a motion with the trial

court to stay its injunction pending appeal. The trial court

denied the stay on May 18, 1981. On June 25, 1981, a panel

of this Court also denied the motion for a stay pending

appeal.

INTRODUCTION

The principal issue raised on appeal is whether the district

court erred in modifying the 1980 Decree to prevent minority

employment from being affected disproportionately by unan-

ticipated layoffs. This issue, however, cannot be properly

addressed until it is first determined whether the underlying

consent decree is fair and reasonable. Only a reasonable

consent decree can be validity modified. Thus, we must first

discuss the procedure for approving consent decrees.

PRELIMINARY APPROVAL

Before preliminarily approving a consent decree, a court

must first determine that the decree is the result of good

faith, arms-length negotiations. United States v. Miami, 614

F.2d 1322, 1330-31 on reh., 664 F.2d 435 (5th Cir. 1981);

Flinn v. FMC Corp., 528 F.2d 1169, 1173 (2d Cir. 1975),

cert. denied, 424 U.S. 967 (1976). A preliminarily approved

decree is presumptively reasonable. See Metropolitan Hous-

Al3

ing Development Corp. v. Village of Arlington Heigh.s, 616

F.2d 1006, 1013 (7th Cir. 1980); United States v. Philadelphia,

$31,327 (%.D. Penn. 1980). Notice of the preliminarily ap-

proved decree must be given to class members and others

who may be affected by the decree. See Village of Arling-

ton Heights, 616 F.2d at 1014. A hearing should be held

after an appropriate period of time. The hearing should

be a forum in which any comments and objections to the de-

cree can be aired. Village of Arlington Heights, 616 F.2d at

1014; Equa! Employment Opportunity Commission v. Amer-

ican Telephone and Telegraph Co., 556 F.2d 167, 173 (3d

Cir. 1977), cert. denied sub nom; Communication Workers of

America v. EEOC, 438 U.S. 915 (1978); Dennison v. Los

Angeles, 658 F.2d 694, 695-96 (9th Cir. 1981); Baker v. Detroit,

504 F.Supp. 841, 847 (E.D. Mich. 1980)

In the instant case, the parties engaged in extensive dis-

covery and were fully prepared for trial before they reached

a settlement. The “ity’s behavior during discovery was de-

scribed by the discrict court as “obstructionist”. The City

bitterly contested the TRO which enjoined certain promotions

in the Fire Department pending the outcome of the Stotts

litigation. Four months before the 1980 Decree was an-

nounced, the City informed the court that settlement nego-

tiations were continuing. On February 20, 1980, it appeared

that settlement negotiations were nearly complete. Five days

later, however, the parties appeared before the court and

stated that the affirmative relief and monitoring sections of

the decree were a source of disagreement. A final agree-

ment on the terms of the 1980 Decree was not reached until

nearly two months later on April 25, 1980. The court pre-

liminarily approved the decree and posted it in the fire halls

for two weeks.’ At the end of the two week period, the court

7 We express no opinion on the adequacy of the notice afforded

by the posting procedure wtiliaed tn Gus ease. ~%)~—

made to the ing procedure either in the district court or on

. appeal. Accordingly, we do not address the notice issue.

Al4

held a hearing to consider objections to the decree. Subse-

quently, the court determined that the decree was a product

of arms-length negotiations.* The procedure adopted by Judge

McRae in preliminarily approving the decree was adequate.

REASONABLENESS HEARING

The determination of whether the decree is adequate, fair,

and reasonable should only occur after the court has had an

opportunity to hold a hearing to consider objections to the

decree. See, e.g., Village of Arlington Heights, 616 F.2d at

1014; Airline Stewards and Stewardesses Assoc. vy. American

Airlines, 573 F.2d 960, 964 (7th Cir. 1978) (per curiam), cert.

denied sub nom., Assoc. of Professional Flight Attendants v.

Airline Stewards and Stewardesses Assoc., 438 U.S. 876 (1978);

Culbreath v. Dukakis, 630 F.2d 15, 23 (1st Cir. 1980); Cotton

v. Hinton, 559 F.2d 1326, 1330 (5th Cir. 1977); Miami, 614

F.2d at 1331-1334. This reasonableness determination is an

issue of law to be determined by the court. See Setser v.

Novack Invest. Co., 657 F.2d 962, 969 (8th Cir. 1981), cert.

denied, —— U.S. —, 102 S.Ct. 615 (1981); Baker, 504 F.Supp.

at 843 n.l. The court should not determine the merits of the

controversy or the precise facts underlying the legal positions

of the litigants presenting the consent decree. See Swift &

Co. v. United States, 276 U.S. 311, 324 (1928); Airline Stewards

and Stewardesses Assoc., 573 F.2d at 963-64. Instead, the

court should merely satisfy itself that the decree is reasonable.

tm making the reasonableness determination, the court is

under a duty to evaluate three factors. First, the court must

consider whether the decree is a fair and adequate resolution

8The better practice is to determine that the decree is not the

product of collusion before the decree is preliminarily approved.

Al5

of the allegations contained in the complaint.* See FMC

Corp., 528 F.2d at 1172; United States v. Trucking Em-

ployers, Inc., 561 F.2d 313, 317 (D.C. Cir. 1977); later app.,

United States v. Trucking Management, Inc., 662 F.2d 36

(D.C. Cir. 1981). Cotton, 559 F.2d at 1330. Ordinarily, the fol-

lowing factors will be considered: 1) the complexity, expense

and likely duration of the litigation; 2) the stage of the proceed-

ings and the amount of discovery completed; 3) the risks of lit-

igation; 4) the resources of the defendant; and 5) the reason-

ableness of the settlement in light of the best possible recovery.

See FMC Corp., 528 F.2d at 1173; Ingram v. Madison Square

Garden Center, Inc., 21 EPD {% 30,393, 13,254 (S.D. N.Y.

1979); Women’s Committee v. National Broadcasting Co., 76

F.R.D. 173, 175 (S.D. N.Y. 1977). The court should be

sensitive to the objections made by class members. FMC

Corp., 528 F.2d at 1173; Cotton, 559 F.2d at 1331.

Second, the court must consider whether the decree is fair

and reasona!:le to non-minorities who may be affected by it.

Vulcan Society v. White Plains Fire Department, 505 F.

Supp. 955 (S.D. N.Y. 1981). American Airline Stewards and

Stewardesses, 573 F.2d at 964. An identifiable statistical

disparity must exist before a decree may embody affirmative

relief provisions.'® See United Steelworkers v. Weber, 443

U.S. 193, 208 (1979), on remand, Weber v. Kaiser Aluminum

& Chemical Corp., 611 F.2d 132 (5th Cir. 1980). The affirma-

* The effects of ciscriminatory pre-Act and post-Act em

=r may be remedied by an affirmative action plan

2 @ qotsens Cues. See Detroit Police Officers Association, 608 F.2d

a

10 The ste" stical imbalance need not be so great as to constitute

bed, 968 <6 facie case. See Setser v. Novak Investment Co., 657 F.2d

968 (8th Cir. 1981); seers Sueno eee Ene, SS ae

at 689, In the context of of consent decrees

A Gf AAT the disclaimer of to be an

cannot unequivocally ‘explain, together” wi the defendants

Al6

tive relief provisions must be reasonably related to the re-

medial purpose of correcting the racial imbalance in the work-

force. See Valentine v. Smith, 654 F.2d 503, 510-511 (8th

Cir. 1981); Lehman v. Yellow Freight System, Inc., 651 F.2d

520, 526-527 (7th Cir. 1981); Detroit Police Officers Associ-

ation v. Young, 608 F.2d 671, 694-698 (6th Cir. 1979), cert. de-

nied, —— U.S. ——, 101 S.Ct. 3079 (1981); United States v. City

of Alexandria, 614 F.2d 1358, 1366 (5th Cir. 1980); Setser, 657

F.2d at 968, 969. See also United Steelworkers v. Weber, supra.

The terms of the decree cannot require the discharge of non-

minority workers and their replacement with minorities. Id.

The decree’s provisions cannot bar absolutely the advancement

opportunities of non-minorities. 1d. Moreover, the decree must

be a temporary remedy designed to terminate when it has elim-

inated the racial imbalance. Id. The decree cannot mandate

the hiring or promotion of unqualified individuals. Id. Final-

ly, the court shall retain jurisdiction over the administration

of the decree and make such further orders as are necessary.

Specific race-conscious hiring and promotion goals and

ratios are appropriate elements of consent decrees. The goal

of achieving racial diversity in the top ranks of city govern-

ment is not only reasonable, but a legitimate constitutionally

permissible interest a city may pursue. See Talbert v. Rich-

mond, 648 F.2d 925, 931 (4th Cir. 1981); Detroit Police

Officers Assoc., supra. This interest justifies individual consid-

eration of race. No decision of the Supreme Court has ever

adopted the proposition that the Constitution must be color-

blind. See Bakke, 438 U.S. 265, 336 (1978); Miami, 614 F.2d

at 1336. On the contrary, the Supreme Court has approved

race-conscious affirmative action in a wide variety of situations

where it is an attempt to ameliorate the effects of past dis-

crimination. See United Jewish Organizations v. Carey, 430

U.S. 144 (1977) (reapportionment); McDaniel v. Barresi,

402 U.S. 39 (1971) (school desegregation); Bakke, 438 U.S.

265 (1978) (graduate school admissions policy); Weber, 443

Al7

U.S. 193 (1979) (admission to union training program); Fulli-

love v. Klutznick, 448 U.S. 448 (1980) (government con-

tracting).

The appropriateness of temporary race-conscious employ-

ment goals or ratios is a fact sensitive inquiry. The test is

whether the technique is a reasonable response to the racial

imbalance the decree was designed to erradicate. See Alex-

andria, 614 F.2d at 1363, 1366. Generally, there should be

some relationship between the magnitude of the imbalance,

the strength of the goals, and the reasonableness of the

provision. Ratios are particularly appropriate where the racial

imbalance is highly disproportionate. A “goal which seeks

the same racial proportion among employees as in the labor

force will ordinarily be reasonable.” Detroit Police Officers

Assoc., 608 F.2d at 696; Alexandria, 614 F.2d at 1366, n.18.

Temporary hiring goals of 50% have been approved routine-

ly as reasonable. See, c.g., Weber, 443 U.S. 193 (reservation

of 50% of all openings in apprenticeship craft training program

reasonable ); Vulcan Society, 505 F.Supp. 955 (50% hiring ratio

reasonable where minority representation in population is

16% while workforce representation is only 3%); EEOC v.

Bartenders International Union, 22 EPD {30,700 (N.D.

Cal. 1979) (50% of job referrals from craft union reasonable);

Alexandria, 614 F.2d 1358 (50% hiring goal reasonable ); United

States v. Jackson, 519 F.2d 1147 (5th Cir. 1975) (50% hiring

goal reasonable); Firebird Society of New Haven v. New

Haven Board of Fire Commissioners, 66 F.R.D. 457 (D. Conn.

1975) (total freeze followed by 50% hiring reasonable where

minority representation in workforce is 4% while minorities are

30% of the population); Bolden v. Pennsylvania State Police,

73 F.R.D. 370, affd. 578 F.2d 912 (3d Cir. 1978) (50% hiring

goal reasonable). In Morrow v. Crisler, 491 F.2d 1053 (5th

Cir.), cert. denied, 419 U.S. 895 (1974), the Fifth Circuit re-

versed an earlier panel decision which had affirmed an affirma-

Al8

tive action plan which relied upon the good faith of the

defendants where there was gross minority underrepresenta-

tion in the employer's workforce. The en banc court or-

dered the district court to consider temporary 1 to 1 or 1 to

2 hiring, the creation of hiring pools, or a freeze on non-

minority hiring.

Temporary promotional ratios are also reasonable. See

e.g., Baker, 504 F.Supp. 841 (50% promotion ratio reasonable ) ;

Dennison, 658 F.2d at 695 (Consent decree which awarded

50% of all promotions to minorities reasonable); Bolden, 73

F.R.D. at 373-74 (33% promotion ratio reasonable); United

States v. Philadelphia, 24 EPD {31,327 (E.D. Penn. 1980)

(promotion of 17% of all incumbent female police officers

reasonable); Firebird Society, 66 F.R.D. 457 (promotional

goal of 33% for the position of lieutenant reasonable ); Jackson

519 F.2d 1147 (“accelerated promotions” of incumbent blacks

reasonable). In American Telephone and Telegraph Co.,

556 F.2d 167, the consent decree directed the Bell Sys-

tem Companies to establish goals and intermediate targets

to promote the full utilization of all race, sex and ethnic

groups in each of fifteen job classifications. The intermediate

targets reflected the representation of such groups in the

external labor market in relevant pools for each operating

company’s workforce. When any operating con jany was

unable to achieve its intermediate target, the decree required

it to depart from normal stancards and select basically quali-

fied candidates.

The final factor a court must consider is all objections to

the decree and alternatives to the decree’s provisions pre-

sented during the hearing. Miami, 614 F.2d at 1334; American

Telephone and Telegraph, 556 F.2d at 178. The preliminarily

approved decree is presumptively reasonable. Philadelphia,

24 EPD at 18,046; Miami, 614 F.2d at 1333.

one objecting to the decree bears the heavy burden of demon-

strating that the decree is unreasonable. Philadelphia, 24 EPD

Alg

at 18,047; Miami, 614 F.2d at 1334. A decree may be finally

approved over the objections of class members and non-minori-

ties who are affected by it. See Dennison, 658 F.2d at 696;

Holmes v. Continental Can Co., 25 EPD 9 31,490 (N.D. Ala.

1980). If the decree is rejected, the principaled reasons for the

rejection must appear on the record. Miami, 614 F.2d at 1333;

Philadelphia, 24 EPD at 18,047. A decree should be rejected

only after the court informs the parties of its precise concerns

and gives them an opportunity to reach a reasonable accommo-

dation. Miami, 614 F.2d at 1333.

The court should not attempt to impose its perspective on

the parties. The court should only determine whether the

decree is within the range of reasonableness. Sorie reliance

may be placed on the ability of competent counsel to accurate-

ly assess the strengths and weaknesses of each litigant’s case.

See Cotton, 559 F.2d at 1330; FMC Corp., 528 F.2d at 1173.

The decree is a compromise. Neither litigant obtained all that

they had hoped to gain initially through litigation.

A principal purpose of Title VII is to induce voluntary race-

conscious affirmative action. Detroit Police Officers Assoc.,

608 F.2d at 690. Courts have placed a high premium on the

voluntary settlement of Title VII actions. See, e.g., Alexander

v. Gardner-Denver Corp., 415 U.S. 36, 44 (1974); Miami,

614 F.2d at 1331-33. Dennison, 658 F.2d at 696; Village of

Arlington Heights, 616 F.2d at 1014-1016. Cotton, 559 F.2d at

1331; United States v. Allegheny-Ludlum Industries, Inc., 517

F.2d 826, 846 (5th Cir. 1975), cert. denied, 425 U.S. 944

(1976); Hutchings v. United States Industries, Inc., 428 F.2d

303, 309 (5th Cir. 1970). Consent decrees enhance the possi-

bility of compliance with Title VII and other employment

discrimination laws. Id. Consent decrees may produce more

favorable results than more sweeping judicially imposed orders

that might risk opposition and resistance. Jd. Consent decrees

also reduce the cost of litigation, engender judicial economy,

A20

and vindicate an important societal interest in affirmative ac-

tion."* Id.

On appeal, the standard of review is abuse of discretion.

Dawson v. Pastrick, 600 F.2d 70, 75 (7th Cir. 1979); Cotton,

559 F.2d at 1331, Village of Arlington Heights, 616 F.2d at

1015. Due deference will be given the trial court's greater

familiarity with the strategy and the relative strengths of cach

‘itigant’s case. See Alexandria, 614 F.2d at 1362.

In the instant case, al! pretrial discovery had been com-

pleted. Thus, counsel and the court were in an excellent

position to assess the relative strengths of each litigant’s case.

The parties agreed to the terms of the 1980 Decree. The

court found that there was no evidence of collusion, stating

“no parroting” had occurred throughout the pretrial period.

The 1980 Decree represents a reasonable compromise of their

competing interests. The City relinquished no more control

over its personnel decisions than was absolutely necessary

to avoid a trial on the merits.’? Plaintiffs did not agree to the

decree until it became apparent that they had obtained

substantially all they could have obtained, given the risks of

litigation.

1? “Settlement agreemenis should. . . be upheld whenever equitable

and policy considerations so permit. By such agreements are the

ee cen 2 Ge pastes, to eter Be weling Gat

turn before overburdened courts, and to citizens taxes support

the latter. —t +h, ~~ gy Ay 4-4

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A21

The adequacy of the 1980 Decree can be assessed by con-

sidering the statistical evidence of discrimination in the record.

This statistical evidence is sufficient to create a strong prima

facie case of racial discrimination. In fact, the trial court

thought that the evidence was so compelling that it could

take judicial notice of the discriminatory employment prac-

tices of the City."? Minorities were excluded from mean-

ingful participation in the Memphis Fire Department for

decades. The goals embodied in the decree are reasonable.

However, the goals are merely an adequate response to the

gross underutilization of minorities within the Fire Depart-

ment. The promotion and hiring goals embodied within the

1980 Decree supplement the relief provided in the 1974

Decree. The 1974 Decree contemplated the imposition of

these goals if the utilization of minorities was not substan-

tially increased. This contingency in the 1974 Decree is an

additional factor enhancing the reasonableness of the 1980

Decree. Significantly, no class member objected to the terms

of the 1980 Decree.

The court also considered the interests of non-minorities.

The affirmative action provisions of the 1980 Decree do

diminish the promotional expectations of non-minorities. A

simple reduction in the “expectations” does not, however,

necessarily make a consent decree unreasonable. For exam-

ple, in Weber, 443 U.S. 193, the expectations of non-minori-

ties were adversely affected, yet the affirmative action plan

was legal. In the instant case, the harm suffered by in-

cumbent non-minority employees because of the promotional

goal is de minimus. Many minorities would have been

a statutory violation of Title VIL. See Detrow Police Opicers Assoc.

y ALT, 686; International Brotherhood of Teamsters v.

States, 431 A tt 4- Under some circumstances such

ay eights v."Metropolitian Housing Corporation, 420 U

A22

promoted even absent the consent decree. In fact, absent

discrimination, the minority promotion rate should approx-

imate the percentage of minorities in the community." See

International Brotherhood of Teamsters v. United States, 431

U.S. 324, 340 n.20 (1977); Detroit Police Officers Assoc., 608 F.

2d at 696-97. Minorities represent 35% of the Memphis Com-

munity, therefore, over the long-run the minority promotion

rate should exceed the 20% promotion ratio in the 1980 Decree.

Viewed in this light, the promotion ratio in the 1980 Decree

is a floor and not a ceiling on minority promotions. The

consent decree embodies a minority promotion ratio which is

less than the 35% minority promotion ratio which presump-

itvely would be the norm absent the City’s past employment

practices. Non-minorities allege the 1980 Decree’s 20% pro-

motion goal unduly interferes with their expectation of pro-

motion. It appears, however, that the expectation of non-

minorities is based upon a pre-decree minority promotion ratio

which pres mptively would have been significantly higher had

the City’s employment practices been non-discriminatory. The

1980 Decree eliminated only a portion of the promotional!

expectations of non-minorities which presumptively were

based on the City’s discriminatory promotional practices.

The court also held a hearing to enable the proposed iuter-

venors to air their objections to the 1980 Decree. The pro-

rosed intervenors suggested that the court restructure the

Fire Department, institute a constructive promotion procedure,

or create more upper management positions so the promo-

tional expectations of non-minorities would not be diminished.

The district court rejected these alternatives. The court was

correct in summarily rejecting the alternatives suggested by

the intervenors. See Philadelphia, 24 EPD at 18,048. The

court had no authority to restructure the Memphis Fire De-

partment. See National League of Cities v. Usery, 426 US.

14 This court assumes the rate of minority participation in the labor

force equals the percentage of minorities in the Memphis community.

A23

833 (1976), on remand sub nom., National League of Cities

v. Marshall, 429 F.Supp. 703 (D.C. Col. 1977).

Finally, the court determined that the decree was reason-

able. We agree. The decree was reasonably related to cor-

recting the underutilization of minorities in the Memphis Fire

Department. The decree did not require the discharge of

non-minority employees and only encompassed qualified

minorities. Moreover, the decree is temporary and does not

constitute an absolute bar to the advancement of non-minori-

ties. More importantly, the court has retained jurisdiction

to enter such further orders as are necessary to effectuate the

purposes of the decree while not unduly trammeling the inter-

ests of non-minorities.

OPERATION OF A CONSENT DECREE

A.

A consent decree is essentially a contractual agreement sub-

ject to continued judicial policing. The terms of the decree,

unlike those of a simple contract, have unique properties. A

consent decree has attributes both of a contract and of a judi-

cial act. See United States v. Motor Vehicles Manufacturers

Association of United States, Inc., 643 F.2d 644, 648 (9th Cir.

1981); United States v. ITT Continental Baking Co., 420 U.S.

223, 236, n.10 (1975). Consent decrees are construed for

enforcement purposes as contracts. See ITT Continental Bak-

ing Co., 420 U.S. at 238. Brown v. Neeb, 644 F.2d 551

(6th Cir. 1981); Strouse v. J. Kinson Cook, Inc., 634 F.2d 883,

885 (5th Cir. 1981). Aids such as the circumstances sur-

rounding the formation of the decree help determine the

purpose for which the decree was entered. See Brown v.

Neeb, 644 F.2d at 562; United States v. Bechtel Corp., 648

F.2d 660, 665 (9th Cir. 1981), cert. denied, 102 S.Ct. 638

(1981); ITT Continental Baking Co., 420 U.S. at 238. The bind-

ing substantive commands of a consent decree are embodied

A24

within the decree’s “four corners”. See United States v.

Armour & Co., 402 U.S. 673, 682 (1971); Strouse, 634 F.2d

at 885. A decree embodies the legal constraints which govern

the behavior of the parties during the life of the decree. See

ITT Continental Baking Co., 420 U.S. at 236. In interpreting

a decree, courts may not depart from its “four corners” unless

its language is ambiguous. See Id.; Motor Vehicles Manufac-

turers Assoc., 643 F.2d at 648.

A decree is always specifically enforceable as written. See

ITT Continental Baking Co., 420 U0.S)\at 238; Miami, 614 F.2d

at 1333; Strouse, 634 F.2d at 885. The subject matter of a

decree in an employment discrimination action, the right to

litigate the issue of discrimination, is always unique. Both

parties relinquish this valuable right in reliance upon the de-

cree. Plaintiff forgoes the right to be made “whole” by

proving a violation of Title VII.'5 A defendant, on the other

hand, relinquishes the right to rebut the allegations of dis-

crimination and avoid the affirmative responsibilities imposed

by a judicial finding of discrimination. A party cannot simul-

taneously benefit from a decree and ignore its corresponding

affirmative obligations. See Strouse, 634 F.2d at 886. The spe-

cific performance ordered should ordinarily accomplish that

progress which would have occurred but for a party's failure

to abide by the terms of the decree. See EEOC v. Local

Union No. 38, 25 EPD 931,553 (N.D. Cal. 1981); Bolden,

73 F.R.D. at 370. A trial court has continuing jurisdic-

tion to modify a decree should its operation become un-

reasonable. See United States v. Chicago, 663 F.2d 1354 (7th

Cir. 1981) (en banc); Miami, 614 F.2d at 1333-34.

na, Vectation had been cxtebtiched, the remedy would have

embodied retrospective well as pr rospective relief. ” see Albmarle

Paper Co. v. Moody, 422 t U.S. 405, 418 (1974).

A25

Quite apart from the contractual mandate of specific per-

formance, the court has an independent duty to ensure that

the terms of the decree are effectuated. The reasonableness

determination is a judicial act and a final order of the court.

This determination places the weight and authority of the

court behind the terms of the decree. An approved consent

decree is not simply a compact between former litigants, rather

it is a court order. Consequently, a court has an affirmative

duty to protect the integrity of its decree. This duty arises

where the performance of one party threatens to frustrate the

purpose of the decree.'* For example, in Local Union No.

38, 25 EPD 131,553, a union was held in contempt for

failing to comply with the terms of a consent decree which

it had entered. The court increased the number of minorities

affected by the decree’s affirmative action plan in the amount

which the union had failed to meet the plan’s goals. In EEOC

v. Bartenders International Union, Local No. 41, 22 EPD

§ 30,700 (N.D. Cal. 1979), the court extended the duration of

a consent decree and increased the percentage goal of integra-

tion where the union fell short of meeting its minority mem-

bership goal, the statistical disparity between minority and

non-minority in the union workforce continued to exist, and the

long-range goal of the decree had not been met. In Bolden,

73 F.R.D. 370, the court modified a consent decree after an

unanticipated economic crisis prevented the employer from

being able to afford to comply with the terms of a decree

which mandated affirmative action. The court increased the

minority hiring goal from 33 to 50 percent and the minority

promotion ratio from 25 to 33 percent.'”

16 Absent extraordinary circumstances, the court should act only

on the motion of the parties.

17 We express no on on whether the goals contained in the

instant decree should increased at the conclusion of the unantici-

pated economic crisis in Memphis.

A26

Cc,

The operation of the promotion section of the 1980 Decree

does not constitute unconstitutional reverse discrimination.

The proposed intervenors suggest that monetary damages,

constructive promotions, and front pay are appropriate com-

pensation for non-minority employees who allegedly are ad-

versely affected by the decree’s operation. The district court

rejected this argument as substantively incorrect. We agree.

Compensatory relief is generally intended to make a litigant

whole for any losses occasioned by wrongdoing. Thus, the

proposed intervenors implicitly contend that the operation of

the decree constitutes a compensable wrong. We hold that a

reasonable consent decree does not constitute a compensable

wrong. In fact, a reasonable consent decree does not adverse-

ly affect any legally protected interest of a non-minority.

Equal Employment Opportunity Commission v. McCall Cor-

poration, 633 F.2d 1232 (6th Cir. 1980) is instructive on this

point. In McCall, male carloaders alleged that a consent

decree which granted retroactive seniority to female employees

constituted an act of discrimination. Judge Kennedy, speak-

ing for this Court, held:

“Acceptance of plaintiffs’ theory that a conciliation agree-

ment and consent decree resulting from a Title VII action

can itself be an act of discrimination would create major

problems.

This court is convinced that the consideration of a

ciliation agreement which results in a consent decr

an act of discrimination against employees not ed

by that agreement would create a situation in which each

settlement would spark new rounds of litigation, settle-

ment of claims would be discouraged, and the courts

would continually be faced with stale claims. Conse-

quently, we hold that conciliation agreement resulting in

consent decrees may not be considered independent acts

*

A27

of discrimination, as a matter of law, unless there are

allegations of bad faith in making the agreement, that

is allegations that the agreement was not a bona fide

attempt to conciliate a claim but rather an attempt to

bestow unequal employment henefits under the guise of

remedying discrimination.” Jd. at 1238; Freeze v. Aro,

Inc., 503 F.Supp. 1045, 1047 (F.D. Tenn. 1980). Accord,

Setser v. Novack Investment Co., 657 F.2d 962, 970 (8th

Cir. 1981) (en banc).

A consent decree may be attacked only on the ground that

its substantive provisions unlawfully infringe the rights of the

complainant. See Society Hill Civic Assoc. v. Harris, 632 F.2d

1045, 1059 (3d Cir. 1980). We hold that a reasonable con-

sent decree which embodies an affirmative action plan does

not affect any legally protected intcrest of non-minorities.

See McCall, 633 F.2d at 1238. Therefore, reverse discrim-

ination challenges to reasonable consent decrees are imper-

missible collateral attacks. See Dennison, 658 F.2d at 695.

Prate v. Freedman, 430 F.Supp. 1373 (W.D. N.Y.), affd., 573

F.2d 1294 (2d Cir. 1977), cert. denied, 436 U.S. 922 (1978);

O’Burn v. Shapp, 70 F.R.D. 549 (E.D. Pa.), affd., 546 F.2d

417 (3d Cir. 1976), cert. denied, 430 U.S. 968 (1977). See also,

Miami, 614 F.2d at 1329 (Consent decree cannot be chal-

lenged by a party whose rights are not affected by it).

The proposed intervenors have not alleged that the 1980

Decree was the product of collusion. Indeed, this record

would not support such an allegation. Moreover, the 1980

Decree is reasonable. Thus, the proposed intervenors’ action

is an impermissible collateral attack. See Dennison, 658 F.2d

at 695-96.

Moreover, awarding compensatory relief to non-minority

employees would impose conflicting or inconsistent obligations

on the City. This is particularly true of the constructive pro-

motion suggestion. Under this alternative, each time the City

A28

attempted to promote minorities, it would be required to pro-

vide an equivalent amount of compensation to a non-minority

employee who allegedly would have been promoted but for

the decree. This extra compensation would drastically in-

crease the cost of each promotion and the cost of complying

with the 1980 Decree. This increased cost would destroy a

primary incentive which motivated the City to enter the 1980

Decree. Thus, permitting the proposed intervenors to sue for

compensation would be inimical to the policy of encouraging

the settlement of Title VII actions.

In addition, the compensatory relief sought by the proposed

intervenors frustrates the purpose of the decree. The purpose

of the decree is to correct the effects of those past employ-

ment practices of the City which may have been racially dis-

criminatory. The decree provides that minorities are entitled

to certain affirmative treatment and consideration in future

promotions because of the City’s past employment practices.

Evidence contained in this record not only supports this en-

titlement, but is sufficient to establish a prima facie case of

racial discrimination. The decree is designed to correct past

employment practices which illegally benefited non-minorities.

The proposed intervenors seek to confer indirectly the benefits

of the decree on non-minorities. Therefore, the relief sought

by the proposed intervenors is patently inconsistent with the

purpose of the decree.

Finally, if the consent decree could constitute an actionable

wrong, the City would be subject to dual obligations. The

failure to enter a consent decree would leave the City poten-

tially liable in the Plaintiffs’ employment discrimination action.

On the other hand, the proposed intervenors imply that com-

pliance with the decree would subject the City to “reverse

discrimination” suits seeking comparable relief for non-minor-

ities. The proposed intervenors’ position places the City in

a “Catch-22” position of incurring liability for employment

discrimination without regard to the action taken. The

A29

absurdity of placing employers in this position has been noted

by several courts. See Telephone Workers Union of New

Jersey Local 827 v. New Jersey Bell Telephone, 450 F.Supp.

284, 298 (D. N.J. 1977), aff'd. 584 F.2d 31 (1978); Dennison,

658 F.2d at 695-6; Hunter v. St. Louis-San Francisco Ry. Co.,

639 F.2d 424, 425 n.2 (8th Cir. 1981). See also Alexandria,

614 F.2d at 1366.

The proposed intervenors contend that this potential double

liability is necessary to ensure that an employer bears the

full price of its past wrongdoing. Permitting double liability

in this situation would clearly maintain the status quo. At a

minimum, double liability would so escalate the cost of af-

firmative action that an employer's ability to implement an

affirmative action plan would be severely crippled. As a

result, affirmative action would be impractically expensive.

It is unfortunate that the City engaged in the employment

practices which precipitated the decree. However, non-

minorities benefitted from, practiced, and acquiesced in those

practices. The 1980 Decree is a reasonable means to correct

the adverse effects which minorities shouldered as a result of

those employment practices. The decree does not adversely

affect any legally protected interest of non-minorities.

The proposed intervenors apparently agree that some action

must be taken to ensure that discrimination does not prevent

minorities from receiving a fair share of the economic oppor-

tunities available. They disagree, however, on the means

selected to accomplish this end. The proposed intervenors

assert that non-minorities are unhappy with the promotion

section of the 1980 Decree. This temporary measure only

partially realigns promotional expectations to reflect minority

employment levels which would have occurred absent the

discrimination. This realignment vindicates a societal inter-

est in remedying the effects of racial and more than justifies

the displeasure some non-minorities may experience. More-

A30

over, the proposed intervenors disregard the fact that minori-

ties may also be dissatisfied with the temporary relief afforded

by the 1980 Decree. In fact, minorities may be less than total-

ly satisfied that the remedial provisions of the decrees are

adequate compensation for the many opportunities foreclosed

to them for decades. The dissatisfaction which non-minorities

and minorities may experience is inherent in the compromise

which the 1980 Decree represents. A consent decree reached

after negotiation and consultation is the preferred means of

balancing the conflicting societal and individual interests

inherent in any employment discrimination action. The only

alternative to a consent decree is a costly and lengthy trial

which would only confront the court with the difficult ques-

tion of how much affirmative action must be imposed to

correct the effects of past employment discrimination.

Il. THE PRELIMINARY INJUNCTION

On May 4, 1981, the City announced that an unanticipated

economic crisis required the layoff of certain personnel in

nonessential services. The proposed layoffs were unprece-

dented in the City’s history. The affirmative relief accom-

plished under the decrees would be severely eroded by the

proposed layoff policy. Subsequently, the court granted an

injunction preventing the City from applying the layoff policy

in a manner which would reduce the percentage of minority

employees in each job classification below that which existed

before the layoffs were announced. The City and the Union

brought this appeal. We must weigh whether the plaintiffs

have shown a strong possibility of success on the merits,

whether the plaintiff or defendant would suffer irreparable

harm and whether the public interest warrants the injunction.

See, e.g., Mason County Medical Assoc. v. Knebel, 563 F.2d

256, 261 (6th Cir. 1977). The standard of appellate review is

A31l

whether the district court abused its discretion in granting

the preliminary injunction. United States v. School District

of Ferndale, 577 F.2d 1339, 1360 (6th Cir. 1978), on remand,

460 F.Supp. 352, vacated, 616 F.2d 895 (6th Cir. 1980), on

remand, 499 F.Supp. 367 (E.D. Mich. 1980).

Judge McRae did not abuse his discretion in granting the

preliminary injunction. First, the statistics denoting the racial

composition, hiring and promotion practices of the Fire De-

partment adequately indicate the probability of plaintiffs

success on the merits.'"* Moreover, the entry of the 1980

Decree constituted a “determination of probability of success

on the merits.” Culbreath v. Dukakis, 630 F.2d 15, 23 (lst

Cir. 1980). Second, the proposed layoffs would irreparably

harm minorities by preventing them from acquiring the ex-

perience necessary for supervisory positions. Finally, the in-

junction serves the public interest by not allowing unexpected

events to eradicate the progress made pursuant to an affirma-

tive action plan. Brown, supra. Racial diversity in the

supervisory ranks of municipal government serving an urban

multi-racial city is, as Judge Lively noted in Detroit Police

Officers Assoc., desirable and in the public interest. See Talbert

v. Richmond, 648 F.2d 925, 931 (4th Cir. 1981).

IV. MODIFICATION OF A CONSENT Dk SREE

There are three grounds upon which a consent decree may

later be modified. First, a decree may be modified in accord-

ance with basic contract principles. Brown, 644 F.2d at 559-560.

Moreover, Rule 60(b) provides relief from a consent decree

upon a showing that the decree is void or is no longer equit-

able. Fed. R. Civ. P. 60(b)(4)(5). See EEOC v. Safeway

Stores, Inc., 611 F.2d 795, 799 (10th Cir. 1979), cert. denied

sub nom, Courtwright v. EEOC, 446 U.S. 952 (1980); Brown,

18 See Footnote 5.

A32

644 F.2d at 560 n.17; Philadelphia Welfare Rights Org'n. v.

Shapp, 692 F.2d 1114, 1120-21 (3d Cir. 1979), cert. denied sub

nom Thornburgh v. Philadelphia Welfare Rights Org'n., 444

U.S. 1026 (1980). A trial court's ruling on a Rule 60(b) motion

will not be disturbed absent an abuse of discretion. See Daw-

son v. Pastrick, 600 F.2d 70, 75 (7th Cir. 1979); Cotton v. Hin-

ton, 559 F.2d 1326, 1331 (5th Cir. 1977). Finally, a court of

equity has continuing jurisdiction to modify a decree upon

changed circumstances. United States v. Swift & Co., 286 U.S.

106, 114-15 (1932); Brown, supra. Modification of a consent

decree, of course, requires a full hearing and findings of fact.

United States v. Atlantic Refining Co., 360 U.S. 19, 23 (1959);

Hughes v. United States, 342 U.S. 353, 357-58 (1952); Brown,

644 F.2d at 560.

A.

The 1980 Decree imposes a duty on the City to engage in

certain affirmative action in its hiring and promotion decisions.

The decree does not contain a provision which would prevent

the operation of the decree if one party experiences an eco-

nomic hardship. In April of 1981. the City expericnced an

unanticipated economic crisis. The City unilaterally de-

termined that a reduction in the number of City workers

could lessen the severity of the crisis. Alternative methods

for mecting the crisis were available. The City had ulti-

mate responsibility for determining: 1) that city-wide layoffs

were the alternative which would most effectively relieve the

crisis; and 2) which job classifications would be subject to

the layoff policy. It is uncontroverted that the application

of the layoff policy to the job classifications selected by the

City would have virtually destroyed the progress belatedly

achieved through affirmative action. The City contracted in

the 1974 and 1980 Decrees to accomplish precisely that which

the layoffs would destroy: a substantial increase in the number

of minorities in supervisory positions.

A33

The district court, sitting as a court of equity, had the

erjuiiable power to order specific performance of the terms of

the 1974 and 1980 decrees. As noted, the 1980 Decree is

based upon the mutual assent of the parties and a judicial

determination of reasonableness. This Decree mandates an

increase in the level of minority employment and promotion

within the First Department. Minorities hired and/or pro-

moted pursuant to the 1980 Decree were parties to and the

intended beneficiaries of the 1980 Decree. Therefore, the

City’s announcement to these employees was in effect notice

of the City’s intended anticipatory repudiation of the 1974

and 1980 Decrees. The announcement notified Plaintiffs that

1) relief previously granted pursuant to the Decrees would

be diminished; and 2) prospective relief under the Decrees

would not be forthcoming.

In response to the City’s announcement, the Plaintiffs sought

to enjoin the proposed layoffs. However, it is apparent from

Judge McRae’s treatment of this case that he properly recog-

nized that Plaintiffs did not seck to modify contractually the

existing consent decrees. Instead, Plaintiffs merely sought

to compel compliance with the terms and goals of the Decrees.

Under the terms of the Decrees, the City was obligated to

employ reasonable, good faith efforts to fulfill the goal of

increasing minority representation in each job classification

in the fire department to levcls approximating the minority

population represented in the civilian labor force in Shelby

County.

The City’s failure to fulfill its obligations under the Decrees

would have subjecied it to liability for violating both its con-

tractual obligations and a judicial order. The City contends

that the sole reason for the layoff proposal was economic hard-

ship. This argument is meritless. It is hornbook contract law

that economic hardship does not excuse performance under a

contract. See ]. Calamari and J. Perillo, Contracts, 491 (2d

ed.). Neal-Cooper Crain Co. v. Texas Gulf Sulphur Co., 508

F.2d 283 (7th Cir. 1974). Consequently, the decrees remained

A34

specifically enforceable. See ITT Continental Baking Co., 420

U.S. at 236. Plaintiffs were presumptively entitled to full per-

formance of the terms of the Decrees. Therefore, the court's

modification of the decree is simply an exercise of its equity

jurisdiction to temporarily relieve the hardship on the City

which strict compliance with the decrees would have caused.

The modification allows the City to proceed with its layoff

policy subject to reasonable deference to its obligations under

the decrees. In our view, the court's decision to modify the

Decrees is a reasonable accommodation of competing interests

and obligations. The modification partially alleviates the

City’s misfortune, while protecting the integrity of the court's

initial orders. The court gave due deference to the City in

structuring its internal affairs. See National League of Cities

v. Usery, supra.. Comity and an appreciation of federalism

caused the court to exercise its equitable powers to apportion

the burden of meeting the City’s fiscal crisis on minorities and

non-minorities alike. The court retains authority to mandate

full compliance with the decrees should circumstances change.

The relicf granted under Fed. R. Civ. P. 60(b) is extra-

ordinary and may be granted only upon a showing of excep-

tional circumstances. Mayberry v. Maroney, 558 F.2d 1159,

1163 (3d Cir. 1977); Philadelphia Welfare Rights Org'n.,

602 F.2d at 1119; Brown, 644 F.2d at 560, n.17. A change in the

facts upon which the consent decree is based usually consti-

tutes an exceptional circumstance. See King-Seeley Thermos

Co. v. Aladdin Industries, Inc., 418 F.2d 31, 35 (2d Cir. 1969),

on remand, 320 F.Supp. 1156 (D. Conn. 1970). See also Safe-

way Stores, 611 F.2d at 800. A consent decree may also be

modified “where a better appreciation of the facts in the light

of expericnce indicates that the decree is not properly adapted

to accomplishing its purposes.” Chance v. Board of Examiners,

561 F.2d 1079, 1086 (2d Cir. 1977), quoting King-Seeley

A35

Thermos Co., 418 F.2d at 35. The availability of relief under

Rule 60(b) is not squarcly presented on this appeal.'’* We,

therefore, express no opinion on whether the 1980 Decree

could have been modified pursuant to Rule 60

Cc.

A trial court has broad discretion in administering consent

decrees. Sec, e.g., Brown, supra; Safeway Stores, 611 F.2d

at 799; American Telephone and Telegraph Co., 556 F.2d

at 178. While acting within its equity jurisdiction, a trial

court has continuing jurisdiction to modify a consent de-

cree upon a showing that “changed circumstances” have

transformed the original decree into an instrument of wrong.

See, e.g., United States v. Swift & Co., 286 U.S. 106, 114-115

19 We note that this court has previously endorsed the analysis of

Rule 60(b) in Philadelphia Welfare Rights Org’n., 802 F.2d at 1120-21:

Any injunction imposing mandatory affirmative duties for the

future involves elements of prediction. Whether the prediction

as to achievability is made as a result of litigation or, as here,

in a negotiated settlement, it will always speculative to

some degree. This is particularly the case when the defendants’

ability to achieve compliance depends upon the receptivity of

class members or other third parties not formally before the

court. See Special Project, the Remedial Process in Institu-

tional Reform Litigation, 78 Col.L.Rev. 784, 818-19 (1978). An

decree imposing more than minimum 0 tive

obligation. That wariness would, we think, tend to

settlement of injunction by consent dec. a high

minimum affirmative obligations, perhaps realistically

achievable > tar of - ne - unreasonable but

is imposed by court order on the assumption that it is realis-

A36

(1932); Hwghes v. United States, 342 U.S. 353 (1952); Brown

supra. The court's power to modify the terms of a decree

should not be exercised lightly. Swift & Co., supra. Modifica-

tion is proper where it has been demonstrated in an evidentiary

hearing that new and unforeseen conditions have created a

hardship. See Brown, 644 F.2d at 559. Accord Chrysler Corp.

v. United States, 316 U.S. 556, 562 (1942) ( The test is “whether

the change served to effectuate or thwart the basic purpose of

the original consent decree.”). See United States v. Chicago,

663 F.2d 1354, 1360 (7th Cir. 1981) (en banc) (the standard

for modification is not “based solely on hardship.” It in-

corporates consideration of whether the purpose of the decree

has been achieved). See also Sarabia v. Toledo Police Patrol-

man’s Ass’n., 601 F.2d 914, 916 (6th Cir. 1979). See generally

Requests By The Government For Modification of Consent

Decrees, 75 Yale L. Rev. 657 (1966); Flexibility and Finality

in Antitrust Consent Decrees, 80 Harv. L. Rev. 1303 (1967).

New and unforeseen conditions exist where there has been a

fundamental change in the essential facts upon which the

decree is based. See Safeway Stores, 611 F.2d at 800 (new.

unforeseeable circumstances not present where “there is no

evidence ir “cating that the facts — e.g, the nature and

makeup of Safeway employees and operations — against which

the decree and the interpreting order were framed have sub-

stantially changed.” ).

It is well settled that a court can modify a consent decree

where layoffs caused by an unanticipated economic crisis

threatens to frustrate the purpose of the decree. See Brown,

644 F.2d 551; Bolden, 73 F.R.D. at 371-72; Castro v. Beecher,

522 F.Supp. 873 (D. Mass. 1981). Thus, even if Judge Mc-

Rae’s decision is not construed as compelling compliance with

the terms of the Decrees, there exists an independent justifica-

tion for the modification.

In Brown, this court held that a trial court could exercise

its inherent authority to modify a consent decree where an

economic crisis unexpectedly caused the City of Toledo to lay

A37

off firemen The layoffs were a new and unforeseen changed

circumstances which threatened to frustrate the purpose of the

Brown decree by destroying its mandated affirmative action.

The nature and racial composition of the Toledo Fire Depart-

ment would also have been radically altered by the layoffs.

The factual situation which Judge McRae faced was vir-

tually identical to that which confronted Judge Young in

Brown. Judge McRae specifically found that: 1) the pro-

posed layoffs werc an unexpected circumstance not antici

pated by the parties when they entcred the decree; 2) the

purpose of the 1980 Decree was to correct the past hiring

and promotion practices of the City through affirmative action;

and 3) the proposed layoffs would have a devastating and

retrogressive effect on the affirmative action mandated in the

1974 and 1980 Decrees. These findings have not been chal-

lenged on appeal. The findings are not clearly erroneous.

The proposed layoffs would impose an undue hardship on

Plaintiffs. The Plaintiffs have relied on the affirmative action

provisions of the 1980 Decree. Thus, they have foregone

their right to litigate the City’s past employment practices

and possibly obtain greater relief. The proposed layoffs would

wrench the belated relief provided by the 1980 Decree from

the Plaintiffs. The City unilaterally selected the job classifica-

tions in the Fire Department which would be affected by the

proposed layoffs. The job classifications selected were those

where minorities had recently made the most gains under the

affirmative action provisions of the 1974 and 1980 Decrees.

Judge McRae was correct in not allowing the City to eradicate

the belated affirmative action it had contracted to accomplish

in the 1974 and 1980 Decrees. Judge McRae did not issue a

blanket order enjoining the layof of all minority workers.

Instead, the court merely prevented the City from reducing

the percentage of minorities in each job classification. Judge

McRae did not abuse his discretion in modifying the consent

decree and enjoining the City from reducing the percentage

of blacks in certain job categories within the City Fire De-

partment.

A38

V. TITE SENIORITY SYSTEM

The city and the Union both assert that the trial court

abused its discretion in modifying the 1980 Decree. Allegedly,

the modification impermissibly awarded “constructive sen-

iority” to minorities in violation of Franks v. Bowman Transp.

Co., 424 U.S. 747 (1976) and International Brotherhood of

Teamsters v. United States, 431 U.S. 324 (1977), on remand

sub nom., EFOC vy. T.1.M.E. — D.C. Freight, Inc., 659 F.2d

690 (5th Cir. 1981). In Franks, the Supreme Court held

that retroactive seniority may be granted to individuals by a

court only upon a showing of post-Act discrimination against

the particular individual. Teamsters held that § 703(h) of

Title VII, 42 U.S.C. § 2000e-2(h), immunizes “bona fide”

seniority systems which perpetuate the effects of discrimina-

tion which occurred prior to the effective date of the act.

Assuming without deciding the Firefighters Union is recog-

nized as such under Tennessee law,?® the City’s and the

Union's reliance on Teamster’s and Franks is misplaced.

A court does not abuse its discretion in modifying or ap-

proving a consent decree which conflicts with the provisions

of a collective bargaining agreement.?' At least three theories

have been advanced which indicate that a consent decree can

alter existing seniority provisions over the objection of an

20 Plaintiffs contend that Teamsters is inapposite because the col-

lective bargaining agrecment between the City and the firemen is

void and unenforceable under Tennessee law. See Keeble v. City o

Alcoa, 204 Tenn. 286, 319 S'W.2d 249 (1958). Consequently, the tria

court's modification of the layoff qyeseture did not violate a valid

ove bargaining agreement. e need not, and do not decide

s issue.

Plaintiff has also attempted to —_ -— Teamsters by raisi

the issue of whether Firefighters Local Union 1784 union fo

after the effective date of Title VII, can be bona {fu'c. This issue is

before the Supreme Court. Sec Patterson v. American Tobacco Co.,

634 F.2d 744. (4th Cir. 1980), cert. granted, 49 U.S.L.W. 3931 (June

15, 1981). We, therefore, do not decide this issue.

21 Circuit Judge Brown and District J Wiseman took a con-

trary view in Brown, supra. It also appears that Circuit Judge Martin

also disagrees with my view. I have taken this unity to full

explain my position and the substantial case au in support of i

A39

adversely affected union. Each of the theories and the

circuit courts which espouse them are described below.

A.

The settlement theory allows a consent decree to alter ex-

isting seniority provisions. The settlement theory is epito-

mized by Airline Stewards and Stewardesses Association,

supra. There the plaintiffs, a class of former female flight

attendants, alleged that the defendant violated Title VII.

After the plaintiffs were granted summary judgment, the

parties reached a settlement during the appellate briefing

process. That settlement provided inter alia that the plain-

tiffs would receive full retroactive “occupational seniority”

upon reinstatement. The exclusive bargaining agent for

American Airlines attendants intervened and objected to this

provision of the settlement. The trial court, however, ap-

proved the settlement.

On appeal, the Seventh Circuit rejected the argument that

Teamsters required each plaintiff to prove that she would

have continued in her employment but for the defendant's

wrongful termination. The court held that:

“We believe that the issues raised by the intervenor

should not be decided on the basis of Title VII law, but

rather must be decided on the basis of legal principles

regulating judicial review of settlement of agreements.

It is a well-settled principle that the law generally

favors the encouragement of settlements. (citation omit-

ted) That general rule has been recognized as applicable

to settlements in Title VII cases. Patterson v. N

& Mail Deliverers Union of N.Y. & Vicinity, 514 F.2d 767,

771 (2d Cir. 1975). In fact, one court has concluded

that it is “the clearly expressed intent of that Act to

encourage settlements.” Flinn v. FMC Corp., 528 F.2d

1169, 1174 (4th Cir. 1975). In addition, it is generally

A40

recognized that settlements are entered into because of

“the very uncertainties of outcome in litigation, as well

as the avoidance of wasteful litigation and expense . . .”

Florida Trailer & Equipment Co. v. Deal, 284 F.2d 567,

571 (5th Cir. 1960). Based on these considerations, this

court has held that a district court in reviewing a settle-

ment agreement “should not attempt to decide the merits

of the controversy . . . [because] [a]ny virtue which may

reside in a compromise is based upon doing away with

the effect of such a decision.” Patterson v. Stovall, 528

F.2d 108, 114 (7th Cir. 1976).

Applying these general principles to this case, we be-

lieve the district court correctly declined to decide the

merits of each of the plaintiffs’ claims. Intervenors

essentially ask this court to require in excess of 100

mini-trials on issues dealing with the adequacy of each

plaintiff's complaint and the availability of defenses. It

seems to us beyond serious dispute that no reasonable

parties are going to settle any case if an intervenor can

force them to litigate separately the merits of each claim.

The rule urged by the intervenor would most seriously

discouraze efforts to settle Title VII cases, and we refuse

to sanction such a result. Id. at 963-64.

In Safeway Stores, the question presented was whether

to modify a consent decree. Although the Tenth Circuit

held the decree could not be modified, the court did en-

dorse the rationale underlying the Seventh Circuit’s decision

in Airline Stewards and Stewardesses, supra. In dicta the

court stated:

“Teamsters prohibits abrogation of a seniority system

only if that system is bona fide. Because this case was

never litigated, there has been no determination that

Safeway’s seniority system is bona fide. Intervenors

would have us assume at this point that the system was

bona fide, or at the least, remand the case for a hearing

_and determination. This we decline to do. The policy

A4l

of voluntary settlement is so important to the enforce-

ment of Title VII would be seriously undermined if the

approving court were required to establish the facts

underlying the parties’ positions before approving a con-

sent decree. The power to compromise exists partially

because of the uncertainties and expense typical of ad-

versary hearing and judicia! determinations of fact. West

Virginia v. Chas. Pfizer & Co., 440 F.2d 1079, 1085-86

(2d Cir.), cert. denied, 404 U.S. 871, 92 S.Ct. 81, 30 L.Ed.

2d 115 (1971). We concur with the district court, “A

Consent Decree would be worthless if it could be attacked

on the ground that had the Court made a particular

determination, such relief would then not be statutorily

available.” Id. at 801.

We adopt the position of the Seventh Circuit in American

Airline Stewards and Stewardesses and the Tenth Circuit in

Safeway Stores. A strong policy favoring voluntary settle-

ments is embodied within Title VII. E.g., Alexander v. Gard-

ner-Denver Co., 415 U.S. 36, 44 (1974), on remand, 8 FEP

1153, aff'd., 519 F.2d 503 (10th Cir. 1975), cert. denied, 423

U.S. 1058 (1976). Airline Stewards and Stewardesses, 573 F.2d

at 963; United States v. Allegheny-Ludlum Industries, Inc.,

517 F.2d 826 (5th Cir. 1976), cert. denied sub nom National

Organization for Women, Inc. v. United States, 425 U.S. 944

(1976). This policy would be seriously undermined if the

facts underlying each parties’ positions were required to be

established. Accordingly, the trial court’s determination that

the seniority provisions were non-bona fide is vacated. The

modification of the consent decree was not error, even though

the Union's seniority system may have been affected.

My opinion in Brown endorsed a second basis for holding

that a consent decree can modify an existing seniority system.

The theory's premise is that a consent decree, the preferred

A42

means of resolving an employment discrimination suit, docs

not decrease the power of a court to order relief which impli-

cates the policies of Title VII and 42 U.S.C. §§ 1981 and

1983. This theory has been approved by the Third Circuit

in an earlier decision, EEOC v. American Telephone and

Telegraph Co., 419 F.Supp. at 1038-1040, aff'd., 556 F.2d 167

(3d Cir. 1977). In American Telephone and Telegraph,

Judge Higginbotham reasoned as follows. First, he noted

that had plaintiffs allegation been established, the court

would clearly have had the power to modify the existing

seniority system to require affirmative action in promotions

and transfers. He also noted that Congress had selected

cooperation and voluntary compliance as the “preferred

means” of achieving the equal employment opportunity poli-

cies of Title VII. Alexander, supra at 44. Finally, he con-

cluded:

Since . . . [the consent decree} is the product of cooper-

ation and voluntary (though possibly grudging) compli-

ance, it is a particularly striking example of the suc

use of the means preferred by Congress for the achieve-

ment of Title VII's goals. In my judgment, then, it

would frustrate the purposes of Title VII to treat the

absence of evidence about AT&T's discrimination in

transfer and promotion policies, and AT&T's denial of

liability for such discrimination, as insuperable obstacles

to the ordering of affirmative action in transfers and pro-

motions. I decline to do so. For the remainder of this

opinion, therefore, I shall treat the allegations of the

complaint with respect to transfer and promotion as if

they had in fact been proved at trial. To approach them

in any other way would make a mockery of the “pre-

ferred means” chosen by Congress to effectuate the goals

of Title VII.

My reasoning in Brown parallels that of Judge Higgin-

botham in American Telephone and Telesraph, supra. In

Brown, the Supremacy Clause enabled the trial court to over-

A43

ride the conflicting provisions of a seniority system and Ohio

law because the case had been brought pursuant to 42 U.S.C.

§§ 1981 and 1983, as well as Title VII. In the instant case,

the Stotts complaint alleged violations of 42 U.S.C. §§ 1981

and 1983 in addition to Title VII. If a violation of 42 U.S.C.

§ 1983 had been established, the court would have had the

authority to invoke the Supremacy Clause to override the

Union's seniority provisions and state law. See, e.g., Swann

v. Charlotte-Mecklenburg Board of Education, 402 U.S. 1, 15

(1971); Brown, supra. It would be incongruous to hold that

the use of the preferred means of resolving an employment

discrimination action decreases the power of a court to order

relief which vindicates the policies embodied within Title VII

and 42 U.S.C. §§ 1981 and 1983. We, therefore, refuse to do

so. The trial court had authority to override the Firefighter's

Union seniority provisions to effectuate the purpose of the

1980 Decree.

C.

The third basis for approving a consent decree which con-

flicts with the provisions of a collective bargaining agreement

is represented in Sisco v. J. S. Alberici Construction Co., Inc.,

655 F.2d 146 (8th Cir. 1981). In Sisco, the Eighth Circuit

held that an employer can temporarily override the provisions

of a collective bargaining agreement pursuant to a valid

affirmative action plan. The employer, Alberici, unilaterally

adopted an affirmative action plan to comply with the federal

contract regulations. The plan established a 10 percent goal

for the number of minority hours of employment on each of

the Alberici’s projects.

Clyde Sisco, a white male, was employed as an ironworker

on the Post Office project. He also held the positiun of

union steward. During the course of work on the project,

Alberici determined that it did not need four ironworkers.

However, to maintain compliance with the goals set in federal

Ad4

regulations, a cutback in its force required the maintenance

of at least onc minority ironworker on the site. Cons: quently,

Sisco and another white ironworker were laid off, while the

only black ironworker and the crew foreman, a white male,

were retained. Sisco protested this action and informed Al-

berici that under the Ironworkers Collective Bargaining Agrec-

ment, Sisco, as union steward, was entitled to special treat-

ment. Under the Agreement, the steward is supposed to be

“the last man laid off.” Subsequently, he brought suit, alleg-

ing his removal from the Post Office Project violated Title VII

and 42 U.S.C. § 198).

The court held:

“It [Alberici] was under pressure from government offi-

cials to improve its percentage of minority hours worked.

There was a history of exclusion of black workers from

the ironworkcrs’ trade in St. Louis. Alberici had decided,

for reasons wholly unrelated to race or to Sisco personally,

to reduce its force of ironworkers at the Post Office from

four to two. In order to accomplish that goal without

further worsening its ratio of minority hours, the black

ironworker (who had been on the site longer than Sisco

and whose qualifications are not questioned) had to be

retained. Of the two employees left, one was white.

The St. Louis Plan [the affirmative action plan] was tem-

porary, in the sense that its goals were expressed in

terms of percentages of hours worked; once the per-

centages were met, no further action by the company

was required. Sisco was not replaced by a new black

worker. A qualified black employee with more seniority

on the job site was simply retained in preference to

Sisco and another white man. For these reasons, we hold

that Alberici’s initial decision to remove Sisco from the

Post Office job was not unlawful.” Id. at 149. See

Savannah Printing Specialties & Paper Products Local

6u4 v. Union Camp Corp., 350 F.Supp. 632 (§.D. Ga.

1972).

A45

The Eighth Circuit's analysis in Sisco indicates that the

City would have, at Plaintiff's urging, modified the provisions

of the collective bargaining agreement to accomplish the goals

set out in the 1980 Decree without violating Title VII or 42

U.S.C. § 1981. The City specifically empowered the trial

court to enter “such further order as may be necessary or

appropriate to effectuate the purpose of this decree.” Con-

sequently, the trial court could use this derivative authority

to temporarily override the provisions of the Union's collec-

tive bargaining agreement.

VI. CONCLUSION

Judge McRae has at all times during this very difficult and

complex case displayed sound reasoning, restraint and wisdom

in his actions. The balance he struck between the interests

of the City, the Union, incumbent non-minority employees,

and minorities who have relied upon the consent decree is

appropriate and consistent with the law. Judge McRae did

not abuse his discretion in approving the 1980 Decree or in

modifying the decree to enjoin the City from destroying the

belated affirmative action accomplished under the decrees.

Accordingly, the judgment of the district court is affirmed.

A46

Boyce F. Maxtin, Jr., Circuit Judge, concurring in part,

dissenting in part. I write separately because 1 can concur

only in the result. I agree that the District Court properly

enjoined the City of Memphis from laying off black firefighters

on the basis of city-wide seniority. In my view, the plaintiffs

satisfied the traditional prerequisites for injunctive relief, and

the District Judge did not abuse his discretion in granting

plaintiffs the temporary relief which they sought. I also agree

that the District Court erroneously determined that the senior-

ity system was not bona fide.

However, I can agree with only one of the theories Judge

Keith espouses to justify modification of the consent decree by

injunction. Judge Keith is correct in stating that a consent

decree is essentially a contract between adversaries to end

litigation and settle differences. As such, a decree is subject

to interpretation and construction as a contract. Unfortunate-

ly, the parties did not foresee the financial crisis which re-

quired massive layoffs. The decree therefore contains no pro-

vision that could be construed either to prohibit or permit

layoffs according to city-wide seniority.

However, the decree contains the following provision where-

by the parties agreed that the District Court should retain

jurisdiction over the parties: “for such further orders as may

be necessary or appropriate to effectuate the purposes of this

decree.” In essence, this provision is boiler-plate language

which recognizes that the District Court has the power to

modify the consent decree in light of changed circumstances,

in order to preserve the level of benefits procured through the

decree. I disagree with Judge Keith to the extent he con-

cludes that this clause gives the District Court “derivative

authority” to modify the provisions of the Union's collective

bargaining agreement. However, to the limited extent that

Judge Keith concludes that the District Court did not abuse

its discretion in protecting the status quo in the Fire Depart-

ment by injunction, I concur.

A47

The District Court's decision to enjoin imminent layoffs was

made after an evidentiary hearing and was based on its

assessment that the decree would be vitiated by the impend-

ing layoffs. I believe that a District Court should be cautious

in modifying a consent decree, especially if such action would

cause the parties to assume obligations for which they have

not contracted. Judge Brown, speaking for himself and Wise-

man, the majority of the panel, articulated this concern in his

special concurrence in Brown v. Neeb, 644 F.2d 551, 565 (6th

Cir. 1981):

Because the City is being required to pursue a course

of action that it has not, by the consent decree, con-

tracted to follow, and because liability has never been

established, it seems to me that the district court should

take particular care to exercise judicial restraint in modi-

fying the consent decree to overrule the decision of the

elected City officials and their appointees concerning the

proper way to mcect this financial crisis.

These considerations apply with equal force to the circum-

stances of the present case; and based upon the facts found

by the District Court, | cannot say that its decision to enjoin

impending layoffs was an abuse of discretion.

I disagree with Judge Keith's statement that: “a consent

decree can alter existing scniority provisions over the objection

of an adversely affected union.” As support for this statement,

Judge Keith reasons that this Court held in Brown that “the

Suprem:.cy Clause enabled the trial court to override the con-

flicting provisions of a seniority system and Ohio law because

that case had been brought pursuant to 42 U.S.C. §§ 1981 and

1983 as well as Title VII.” I cannot agree that his statement

accurately reflects this Court’s holding in Brown. Although

Judge Keith reached this conclusion in his opinion in that case,

Judge Brown expressly rejected it in his special concurrence,

in which District Judge Wiseman joined. As I read Brown,

its holding on the issue of a union's rights is expressed in

A48

Judge Brown's opinion. Judge Brown, writing for himself and

for District Judge Wiseman, the majority of the panel, stated

that:

In my view, even though this action was brought pur-

suant to 42 U.S.C. §§ 1981 and 1983 and not pursuant to

Title VII, the district court did not have the authority,

when it issued the preliminary injunction to abrogate the

contract and statutory rights of the Union te layoffs by

seniority. The Union, although it had existing contract

and statutory rights to layoffs by seniority, was not a

party to this litigation when it was filed and when the

consent decree was entered. Therefore, its rights vis-a-vis

the City were not affected by the consent decree. Al-

though it intervened at the time plaintiffs moved for the

instant preliminary injunction, there was, again, no de-

termination of liability in this proceeding, and the

Union's position was that the district court could not and

should not authorize layoffs on a basis other than seniori-

ty. The district court did not so authorize layoffs. The

district court could abrogate the rights of the Union to

layoffs hy seniority, as required by its contract and the

Ohio statute, only in a proceeding in which the Union

was a party, and in which there was a determination that:

(1) plaintiffs’ constitutional rights had been infringed;

and (2) it was necessary to vindicate plainti{s’ constitu-

tiona! rights to hold such contract and statutory rights of

the Union to be unenforceable.

644 F.2d at 566

Applying Judge Brown's reasoning here, I must conclude

that the District Court has no authority to abrogate the

Union's contractual and statutory rights. The Union was not

a party to this suit when the consent decree was entered.

Judge McRae simply enjoined the City from making its pro-

posed layoffs in the Fire Department. Judge McRae’s actions

do not affect the collectively bargained rights of the Union.

I therefore dissent from Judge Keith’s opinion, to the extent

A49

that it holds otherwise. The law in this Circuit does not

sanction modification of a consent decree to alter or destroy

the rights of a non-party union concerning layoffs by seniority,

unless a hearing is held in which the union is a participating

party, and a court determines that: “(1) plaintiffs’ constitu-

tional rights had been infringed; and (2) it was necessary,

to vindicate plaintiffs’ constitutional rights, to hold such con-

tract and statutory rights of the Union to be unenforceable.”

Brown v. Neeb, 644 F.2d at 567 (Brown, J. concurring in

result only). (emphasis added).

Furthermore, the consent decree does not concede liability,

and it cannot be construed as such an admission. The Dis-

trict Court has never held an evidentiary hearing nor has it

determined that the City is liable for past acts of discrimina-

tion. To the extent that Judge McRae and Judge Keith

assume that liability has, in fact, been established, I must also

disagree.

I dissent from those sections of Judge Keith’s opinion that

purport to discuss the merits of the proposed intervenors’ sug-

gestions for alternative relief. As I read the record, Judge

McRae never held a hearing on the merits of constructive

promotion, monetary damages, or any of the other alternatives

advanced by the unsuccessful intervenors in their motion to

intervene. In fact, Judge McRae did not discharge his duty

to consider fully the interests of incumbent employees before

approving the settlement decree. See Airline Stewards v.

American Airlines, 573 F.2d 960 (7th Cir. 1978). The sole

purpose of the May 16, 1980 hearing was to determine the

validity and timeliness of the intervention request itself. The

only consideration Judge McRae gave to the merits of the

proposals he expressed in these words: “And I would not be

a party to any of this constructive promotion bit. That's not

much good for anybody. And it is certainly not good — well,

that’s no way to run a fire department.”

Today this Court has upheld the District Court's decision

that the intervention motion was untimely. D. L. Orders,

A50

et al. v. Carl W. Stotts, et al., No. 80-1469. 1 have dissented

from that conclusion, and I reaffirm my judgment on the

intervention issue here. Judge Keith states for the majority

that the proposed intervenors’ attempt to intervene to chal-

lenge the consent decree is “an impermissible collateral at-

tack.” Judge Keith misapprehends the very purpose of inter-

vention, which is to afford to unrepresented persons who have

an interest in litigation a legitimate avenue for asserting and

protecting that interest. Intervention confers standing on a

party to participate in litigation and thus affords the inter-

vening party the very means by which to avoid estoppel. I

also disagree with Judge Keith's statement that compensatory

relief for incumbents would impose conflicting obligations on

the Department. In my view, it would merely make compli-

ance more expensive.

This Court has not been asked to review the merits of a

judicial determination on the proposed intervenors’ argu-

ments. The proposed intervenors are not formal parties to

this litigation, nor to any of the prior proceedings. Because

Judge McRae never held a hearing on the merits, no issue has

either been raised or preserved for appellate review beyond

the timeliness of the motion to intervene itself. Having de-

cided that the motion was untimely, Judge McRae had no

jurisdiction to entertain the merits of the proposed inter-

venors arguments. Neither does this Court. Nor has this

Court been presented with the contention that the decree

constitutes “reverse discrimination.” I dissent from Judge

Keith's sua sponte conclusion that the decree is “constitu-

tional.” I am disturbed by Judge Keith’s lengthy discussion

of the consent decree’s validity and reasonableness vis a vis

the proposed intervenors. In my view, this discussion is

purely advisory, inappropriate in light of the conclusions |

reach in my dissent in D. L. Orders, et al. v. Carl W. Stotts,

et al., No. 80-146, and most importantly, far beyond the scope

of our appellate jurisdiction.

I offer one final observation on the majority opinion. The

A5l

majority asserts that the proposed intervenors improperly

asked the District Court to “restructure” the Memphis Fire

Department. Judge Keith states that Judge McRae correctly

denied this request, because he lacked such authority under

National League of Cities v. Usery, 426 U.S. 833 (1976). I

find the majority's statement and citation ironic, given the fact

that this Court today affirms the modification of the consent

decree to prevent the City and the Department from following

their standard seniority system in conducting layoffs. The

irony of the majority's statement is particularly striking, read

in light of the majority’s conclusion that the Department

should not have determined unilaterally to reduce the number

of workers. According to the majority, “[4jlternative methods

for meeting the crisis were available”, and, presumably,

should have followed.

A52

APPENDIX

IN THE UNITED STATES DISTRICT COURT

FOR THE WESTERN DISTRICT OF TENNESSEE

WESTERN DIVISION

UNrrep STATES OF AMERICA,

Plaintiff,

v. Civu. ACTION

Crry or Mempuis, a municipal cor- No. C-74-286

poration, et al,

Defendants.

CONSENT DECREE

(Filed November 27, 1974)

This action was brought by the Attorney General against

the City of Memphis to enforce the provisions of Title VII

of the Civil Rights Act of 1964, 42 U.S.C. 2000e, et seq., as

amended by the Equal Employment Opportunity Act of 1972

(Pub. L. 92-261, March 24, 1972); the State and Local Fiscal

Assistance Act of 1972, 31 U.S.C. 1221, et seq., the Fourteenth

Amendment to the Constitution of the United States and 42

U.S.C. § 1981. The Complaint sets forth certain allegations

of the United States of America that the City of Memphis has

engaged in a pattern or practice of discrimination based on

race and sex in hiring and promotion within the City divisions,

including the Memphis Light, Gas & Water Division. This

Consent Decree resolves all issues raised by the Complaint

with the City other than the employment practices of the

Light, Gas & Water Division and the terms of this Decree

A53

do not apply to that Division. All issues raised by the

Complaint regarding employment practices at the Light, Gas

& Water Division remain outstanding.

The City of Memphis denies it has heretofore engaged in

any pattern or practice of discrimination in hiring or promo-

tion on the basis of race or sex but realizes that certain past

practices of the City may have given rise to an inference that

such practice may have occurred. The City states that it has

made good faith efforts to rectify racial or sexual exclusion

in City employment and that since January 1, 1972, it has sub-

stantially increased blacks and women in the Police Division

and blacks in the Fire I vision. The City states that for

the purpose of avoiding any further inference of discrimina-

ation, it has heretofore taken certain steps to increase the

“availability of qualified black and female employees by trans-

fer and promotion, training programs, and career ladder pro-

grams in City employment.

For the same purpose and with the same intent the City

is now willing to agree to the entry of a consent decree pro-

viding for additional measures to be taken. Both parties wish

to avoid the delay and expense of litigation and desire to

insure that any disadvantage to blacks and females that may

have resulted from any past discrimination in obtaining em-

ployment and advancement is remedied so that equal employ-

ment opportunity will be provided to all. The City of Mem-

phis and the United States, by agreeing to the issuance of this

order, waive a hearing and finding of facts and conclusion of

law on all issues raised by the Complaint with respect to

employment by the City except employment at the Light,

Gas & Water Division and the parties have mutually agreed

to the entry of the consent decree, which shall not constitute

an adjudication or admission by the City of any violation

.of law or findings on the merits of this case.

IT IS HEREBY ORDERED, ADJUDGED AND DE-

CREED AS FOLLOWS:

A54

1. The Defendant City and its officials, agents and em-

ployees and all persons acting in concert with them in the

performance of City functions shall not engage in any act or

practice which has the purpose or effect of unlawfully dis-

criminating against any employee of, or any applicant or

potential applicant for employment with the City of Memphis

because of such individual's race or sex, it being understood

that remedial actions and practices permitted by this Decree

shall not be deemed discriminatory. Specifically, the Defen-

dant City shall not fail or refuse to hire, promote, upgrade,

train or assign any individual, discharge any individual or

otherwise discriminate against an individual as an employee

or applicant for employment with respect to compensation,

terms, conditions or privileges of employment because of race

or sex.

2. The provisions of this Decree are intended to cover all

full-time employment with the City of Memphis, except that

the goals and other affirmative relief established herein, in-

cluding affected class relicf, shall not apply to employment

in the Memphis Transit Authority, the Memphis-Shelby

County Health Department, the Memphis-Shelby County

Planning Commission, the Memphis-Shelby County Airport

Authority, the Memphis Housing Authority, the Board of

Education of the Memphis City Schools, Memphis-Shelby

County Public Library and the Memphis-Shelby County

Hospital Authority, said organizations either being separate

authorities or administered through the County of Shelby; and

provided further that the provisions set forth in the succeeding

paragraphs do not apply to part time employment unless the

provision so states.

3. The purpose of this decree is to insure that blacks

and women are not placed at a disadvantage by the hiring,

promotion and transfer policies of the City, and that any dis-

advantage to blacks and’ women which may have resulted from

past discrimination is remedied so that equal employment

A55

opportunities will be provided to all. The City has agreed that

in determining whcther that purpose has been achieved, an

appropriate standard of comparison is the proportion of blacks

and women in the Shelby County civilian labor force. ‘fhe

City, therefore, agrees to undertake as its long term goal in

this decree, subject to the availability of qualified applicants,

the goal of achieving throughout the work force proportions

of black and female employees in each job classification,

approximating their respective proportions in the civilian labor

force. Except as otherwise provided in paragraphs 4, 10, and

15 below, the City shall, in meeting the long term goal for

black employees, establish and attempt to meet an interim

goal, in classifications where the long term goal has not been

met, of filling at least 50% of all vacancies with qualified black

applicants. The City in meeting the long term goal for

women shai: actively encourage female employees in clerical

positions to seek transfer or promotion to those positions where

the long term goal has not been met, and shall employ affirma-

' tive recruitment efforts for female applicants for those posi-

tions which are entry level classifications. Except as provided

in paragraphs 4, 10, and 15, no specific interim numerical goals

shall be established for women for the initial year of this

Decree. After February 15, 1976, the parties shall meet with

the City to determine appropriate interim goals for women

for those job classifications in which the long term goal has

not been met. In no event shall the City be required to hire

unnecessary personncl, to hire, transfer or promote a person

who is not qualified or to hire, transfer o: promote a less

qualified person in preference to a better qualified person,

nor shall the City apply any standard for employment which

does not validly measure qualifications for that position.

Compliance with intcrim goals established pursuant to this

decree shall be measured on an annual basis except where

otherwise specifically provided.

4. The City shall, for those positions such as accountant

A56

and engineer which require a professional degree, establish

and attempt to achieve an initial interim goal of filling 30%

of the total vacancics in such positions with qualified black

and/or female applicants. This level of this interim goal shall

be reviewed by the parties after February 15, 1976, on the

basis of performance of the City in the period and the avail-

ability of qualified black and female applicants in these

professional areas.

5. (A) Insofar as the term “affected class” is used in the

provisions of this Decree, it shal] include:

(1) Incumbent black full-time employees hired prior

to January 1, 1972, in the I» slic Works and Sanitation

Division, and in the Park Commission, who are in pay

grades 51-52-53-54-55, except for the positions of Zoo

Keeper and Auto Inspection I and II, and to include ser-

vice truck and wrecker operator, and all other black

incumbent employees who are employed in positions

considered classified which exist below grade 9 in the

City’s current pay plan.

(2) Female incumbent full-time employees in posi-

tions which are by job title or description clerical in

nature.

The defendant agrees to furnish to the plaintiff within nine-

ty (90) days after the entry of this decree a list of the mem-

bers of the affected class by job classification and individual

seniority date.

6. (a) The City shall, for all purposes of promotion,

transfer and assignment, compute the seniority of a person in

the affected class as defined in paragraph 5, as the total

seniority of that person with the City.

(b) Except as otherwise provided in paragraphs 10 and 15

for filing vacancics in the Police and Fire Division and in

A57

supervisory positions, the following procedure shall be fol-

lowed in filling vacancies under this decree:

(1) A member of the affected class shall be given

the initial opportunity to fill any vacancy in the City

where the person is the senior applicant who meets the

minimum qualifications for the position. This preference

is exercised at the written election of the anplicant. An

affected class member using this preference who success-

fully transfers to and holds a position, as defined in

paragraph 8, shall be considered on the same basis as

other applicants on subsequent bids, subject to 6(a)

above.

(2) Where no affected class member seeks or is

entitled to a vacancy as provided in (1) above, the va-

cancy shall be filled pursuant to the procedures set forth

in the City’s Civil Service Ordinance and in the City’s

labor memoranda subject to 6(a) herein and in a manner

consistent with meeting the goals set forth in the decree.

7. All members of the affected classes shall be notified of

the provisions of this Decree and specifically of the oppor-

tunity to transfer and/or promote to other positions when such

vacancies occur and are posted for bid by the City Personnel

Division. At least ten (10) days before any such vacancies

are to be filled, notices of the vacancies shall be posted at

each location and in each department where a member of

the affected class is employed. Appointed positions listed

under Charter Section 248 (d), (e), (f), (g), and (h) are

excluded from this posting requirement.

8. If a member of the affected class shall transfer or pro-

mote to a new position pursuant to paragraph 6(b)(1), the

person shall be given a reasonable opportunity of up to ninety

(90) days or up to six (6) months under Civil Service, as ap-

propriate, to determine if he or she wishes to remain in the

A58

position or for the City to determine if he or she is able to

perform the job. Should the person wish to relinquish the

position, or the City determine that the person is not able

to perform the job, the person may return to the previously-

held position with the same pay as prior to transfer and with-

out loss of seniority Whenever such a person is determined

by the City not to be qualified or capable of performing in the

position, the City shall submit in its periodic reports to the

United States a written statement detailing the basis for the

person’s removal from the position. It is agreed that nothing

in this Decree shall require Defendant to keep an employee in

any position after the trial period in which the employee can-

not perform the assigned tasks as adequately as such tasks

have generally been performed in the past or if the employee's

work habits or attendance are inferior as compared with other

employees doing similar work.

9. No member of the affected class who makes a lateral

or downward transfer for the purpose of enhancing promo-

itonal opportunities, shall be paid at a lower rate than the

rate for the job from which the person transferred, including

any regular within grade increments the person would have

received had the person remained on that job. A person utiliz-

ing rate retention pursuant to this paragraph who returns or

is returned to the original job pursuant to paragraph 8, may

utilize the right to rate retention on a subsequent transfer,

provided, however, that this right to rate retention may not

be exercised on more than three occasions. The right to

rate retention shall continue until the person has reached

that level in the new department or line of progression where

the rate of pay is equal to or higher than that in the previously

held job classification. A transferee shall lose this privilege of

rate retention if the person refuses a promotion in the new

line of progression or fails to bid on a higher rate job in the

new department for which he or she is eligible.

A59

IN THE UNITED STATES DISTRICT COURT

FOR THE WESTERN DISTRICT OF TENNESSEE

WESTERN DIVISION

Cari W. Storrs,

Plaintiff,

v.

Civit ACTION

Memruis Fine DerarTMent, et al., No. C-79-2441-M

Defendants.

Frep L. Jones,

inti

- esti Crvit ACTION

No. C-77-2104

Mempnis Frre DeranTMENT, et al.,

Defendants.

CONSENT DECREE

The plaintiffs Carl W. Stotts and Fred L. Jones filed their

complaints in this action on February 16, 1977 and June 19,

1979 against the Memphis Fire Department and other City of

Memphis officials, alleging that the defendants are engaged

in a pattern or practice of discrimination in hiring and pro-

motions on the basis of race in violation of Title VII of the

Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq., as amended

by the Equal Employment Opportunity Act of 1972 (Pub.

L. 92-261, March 24, 1972); 42 U.S.C. § 1981 and 42 U.S.C.

§ 1983.

The parties wish to avoid the delay and expense of con-

tested litigation and desire to insure that any disadvantage

to minorities that may have resulted from past hiring and pro-

.

A60

motional practices be remedied so that equal employment

opportunity will be provided to all.

The Court has jurisdiction over the parties and subject

matter of this action.

The parties, by agreeing to the issuance of this order, waive

a hearing and findings of fact and conclusions of law on all

issues raised by the complaints, and the parties have mutually

agreed to the entry of this Consent Decree. Defendants, by

entering into this Consent Decree, do not thereby admit any

violations of law, rule, or regulation with respect to the allega-

tions made by plaintiffs in their complaints.

The Court having been fully advised and informed of the

facts and circumstances, and good cause appearing therefore,

NOW, THEREFORE, IT IS HEREBY ORDERED, AD-

JUDGED AND DECREED THAT:

1.

EFFECT OF THE CONSENT DECREE

This Decree is entered into as a settlement of an existing

dispute between plaintiffs and defendants as to appropriate

and valid procedures for the hiring and promotion of Fire

Department personnel for the City of Memphis. It also pro-

vides for specific, definable and good faith efforts to be made

by defendants to achieve certain goals for employment of

blacks. This Consent Decree satisfies and resolves all claims

of plaintiffs and the class they represent of racial discrimina-

tion with respect to those matters set forth in the complaints

and the previous orders of this Court.

This Decree is not intended to conflict with any provisions

of the Consent Decree entered into on November 24, 1974

between the United States of America and the City of Mem-

phis in Civil Action No. 74-286; rather this Decree is intended

to parallel and supplement the relief provided in that Consent

Decree.

A61

Both plaintiffs and the class they represent shall seek no

further relicf for the acts, practices or omissions alleged in the

complaints save to enforce the provisions of this Decree, there-

by waiving the right to seek further relief.

Plaintiffs agree that this Consent Decree is fully binding

individually and on the class they represent. Defendants

agree that this Consent Decree is tully binding on each of

them, each of their officers, agents, employees and successors,

and all other persons acting in concert with them who have

notice of this Decree.

Il.

CLASS CERTIFICATION

Plaintiff Stotts brought this action as a class action, and in

its order of May 4, 1978, the Court certified the plaintiff class.

For purposes of this Decree, the Court hereby adopts the class

description set forth in that order with modifications as fol-

lows:

\ The class in this case consists of all incumbent black

\ employees of the Memphis Fire Department, all those

black employees who will be employed there in the

future, and all black persons who have been denied

employment with the Memphis Fire Department since

March 24, 1972.

This action was brought, insofar as is relevant to this section

of the Decree, on the basis of Title VII of the Civil Rights Act

of 1964, 42 U.S.C. § 2000e et seq., as amended, and 42 U.S.C.

§§ 1981 and 1983. For purposes of this settlement alone, and

for no other purposes, the Court is satisfied that the above

class should be and hereby is certified as proper under Fed-

eral Rule of Civil Procedure 23(b)(2) for injunctive, declara-

tory and back pay relief, and under Federal Rule of Civil

Procedure 23(l)(3) for purposes of recovery of compensatory

or punitive damages, if any.

A62

Il.

GENERAL

1. Defendants are compelled by law and by entering

into this Consent Decree acknowledge their obligation to, and

agree that they shall, refrain from enaging in any act or

practice which has the purpose or effect of unlawfully dis-

criminating against any employee of, or any applicant or

potential applicant for employment with, the Memphis Fire

Department because of such individual's race or color. Defen-

dants in addition acknowledge their duty under law to and

agree that they shall, refrain from discrimination at any time

on the basis of race in hiring, promotion, upgrading, training,

assignment or discharge or otherwise discriminating against

an individual employee or applicant for employment with

respect to compensation, terms and conditions or privileges

of employment because of such individual's race. The City

shall take reasonable steps to assure that no member of the

Fire Department interferes with the enforcement of this de-

cree by any means. The acknowledgments set forth in this

paragraph do not create a right or rights in any person or

groups of persons to seek relicf under this Decree for defen-

dants’ failure to comply with their general legal obligations

as described in this paragraph, except for conduct which con-

stitutes a pattern or practice of unlawful discrimination on the

basis of race.

2. In the event the entry of this Consent Decree generates,

either through intervention or separate, collateral lawsuits.

attacks on the appropriateness or sufficiency of any of the

provisions contained herein, to include actions claiming en-

titlement to damages against the City as a result of the order-

ing of any of the affirmative relief contained in this Decree,

the parties hereto agree and warrant that they shall defend

the lawfulness of any provision or provisions so attacked If

any such collateral lawsuit arises in state court against the

A63

City, it shall seek to remove such action to the Federal Dis-

trict Court.

IV.

SELECTION PROCEDURES

3. The City shall continue to develop and reassess its pres-

ent affirmative recruitment program to inform minorities of

job opportunities with the Memphis Fire Department. In

filling vacancies in the entry level position, the City shall

continue to emphasize recruitment from among qualified

members of the aflected class, as provided in the Consent De-

cree in CA-74-286.

4. The City may maintain their current or similar educa-

tion standards and selection procedure for firefighters, pro-

vided, however, that these standards and procedures do not

have an adverse impact on members of the affected class as

measured by compliance with the interim hiring goal set out in

paragraph 7 below. If such impact is shown, the City must

standard or selection procedure.

5. The City may continue to use on a pass-fail basis (or

other grading system authorized by the U.S. Department of

Justice provided that no adverse racial impact is present)

written promotional examinations for the Fire Department.

However, the City shall evaluate these examinations and pro-

motional testing procedures to insure that the use of these

examinations will not have an adverse impact on black appli-

cants. The partics agree that adverse impact will be shown

if the adverse differential in the failure rate for blacks is in

excess of five (5) percent. The City shall mairtain records

)

:

Hl

the impact on black applicants and shall provide this

iton to plaintiffs’ attorney at the same time as the

is submitted to the United States Department of

accordance with the Consent Decree in CA-74-286.

i

A64

The City also agrees that it will administer promotional

examinations on a regular basis. but in any event, at least

every two years. The City shall notify plaintiffs’ counsel of

plans to administer promotional examinations as soon as prac-

ticable after the decision has been made on such plans.

V.

GOALS

6. The purpose of this decree is to remedy the past hiring

and promotion practices of the Memphis Fire Department

with respect to the employment of blacks and continuing the

efforts made in the City in hiring and promotions under the

consent decree entered in CA-74-286. In achieving that pur-

pose, it is the intent of the parties to work within the arrange-

ments established between the Department of Justice and the

City of Memphis in that consent decree. In that regard the

parties agree that the long term goal established in this decree

shall be that set forth in CA-74-286, viz. that the goal shall be

to raise the black representation in each job classification on

the fire department to levels approximating the black propor-

tion of the civilian labor force in Shelby County. Goals

established herein are to be interpreted as objectives which

require reasonable, good faith efforts on the part of the City,

and not as rigid quotas.

7. Hiring: The City shall, in meeting the long term goal

for black employees, establish and attempt to meet an interim

goal, in entry level classifications where the long term goal

has not been met, of filling on an annual basis at least 507

the experience with prior academy classes, the parties expect

that the interim hiring goa! above will be met both at time

of initial appointment and successfi! completion of academy

training. If any classes of firefighters hired pursuant to this

order experiences a disproportionate rate of attrition among

A65

black firefighters, the partics shall meet promptly to deter-

mine the reason therefor, and to discuss methods or remedy-

ing the unbalance so that achievement of the long-term goal

can be facilitated.

8. Promotion: To insure as quickly as practicable the at-

tainment of its long range goal, the City agrees to the follow-

ing interim goals, subject to the availability of qualified ap-

plicants:

(a) The City adopts the goal of promoting Black appli-

cants to positions above the rank of private or other entry

level job classification in proportion to their representation in

the qualified applicant pool for each uniformed rank or civil

service classification. The partics agree to a goal of pro-

moting blacks in the proportion of at least 20% for each civil

service classification or uniformed-rank as measured on an

annual basis; the parties recognize that the number of blacks

qualified for a particular job rank or classification may be a

relevant factor in measuring the City’s compliance with these

goals. Nothing in this paragraph or Decree should be con-

strued in such a way to require the promotion of the unquali-

fied or the promotion of the less-qualified over the more qual-

ified as determined by standards shown to be valid and non-

discriminatory as set forth in the Uniform Guidelines on Em-

ployee Selection Procedure, 28 C.F.R. 50.14.

(b) During periods when acting positions are available,

these non-permanent assigiments from the next lower rank

in the uniformed force shall be based on experience and

demonstrated ability, for the position to which the employee

shall be assigned and, consistent with the foregoing, reason-

able efforts shall continue to be made to give leadership ex-

perience to eligible blacks.

A66

VI.

SPECIFIC RELIEF

9. Promotions: The promotions lisited in Exhibit A to

this Decree shall become effective upon the entry of this

decree. The conditional promotions shall become effective up-

on fuliillment of cach condition listed in Exhibit A.

10. Monetary Relief: The parties to this Decree have

agreed that the aggregate monetary relief in this case shall

be $60,000 of which all shall be considered back pay. This

money shall be awarded pursuant to the amounts listed in Ex-

hibit B with the City to prepare individual checks within

15 days (or as soon as practical utilizing good faith efforts)

of the final entry of this decree and delivered to plaintiffs’

counsel for distribution. All persons who receive monetary

relief herein shall execute a release in the form attached as

Exhibit C as a condition of payment.

Vil.

REPORTING

ll. The City shall maintain and retain during the period

of this decree necessary records to support the implementation

of this decree which shall be the same records kept for imple-

mentation of the Consent Decree in CA-74-286. These rec-

ords shall be made available to the plaintiffs’ counsel for in-

spection and copying upon written request and where ap-

plicable subject to an appropriate protective order.

To avoid conflicts with the Attorney General's continuing

monitoring and compliance efforts pursuant to the Consent

Decree in CA-74-286, the parties agree to the following pro-

visions:

(a) The City will furnish to Plaintiffs’ counsel copies of

all reports relating to the Fire Division made to the Attorney

General pursuant to the Consent Decree in CA-74-286.

A67

(b) Should any dispute or controversy arise concerning

the Defendants’ application of, or adherence to, the provi-

sions of this decree, Defendants’ and Plaintiffs’ counsel shall

confer with the Attorncy General and seek a mutually agree-

able resolution of the disputes.

(c) Should voluntary efforts to resolve the dispute or con-

troversy fail, Plaintiffs’ counsel may then petition the Court

for redress or resolution.

12. The City will maintain the following records:

(a) All applications and related records for all persons

seeking employment or promotions with the Memphis Fire

Department and shall include on such applications identifica-

tion of the applicant by race. The records retained shall in-

clude, where applicable, copies of tests administered and the

test results.

(b) All written communications between the City and

applicants for both initial entrance, transfer and promotion.

13. At the times established for such reports to the At-

torney General in CA-74-286, the City shall report to plaintiffs’

counsel the following information:

(a) A summary showing the total number of employees

by race in each job classification of the Memphis Fire De-

partment.

(b) A list of all newly hired employees indicating the

name, race, and job classification of each since the last re-

port was filed.

(c) A list of all persons, by job classification, to whom

promotion has been offered and whether or not that promo-

tion has been accepted.

(d) oo ney linge gree het § apt

Fire Department by race which indicates the number of

by race, and pending for each job classi-

A68

fication. A person is considered an applicant for this purpose

upon filing a formal application when a job is posted and upon

meeting the minimum qualifications for the position.

(e) A list of all promotions, name, race, and date of hire

of the employee promoted and the date of the promotion.

14. The City shall provide counsel for the plaintiffs a

copy of each of the following documents relating to the Fire

Division at the times established for reporting to the At-

torney General pursuant to the Consent Decree in CA-74-286:

(a) each eligibility list for hiring or promotion to any

rank in the department identifying each individual on said

list by name and race;

(b) each new or revised job description or classification;

(c) notice of the filling of vacancy in any uniformed

or non-uniformed position within the Fire Department in-

cluding the name and race of the person selected.

Vil.

MISCELLANEOUS

15. Attorneys’ Fees and Costs. The City shall pay counsel

for plaintiffs, attorneys’ fees and costs in the amount of

Mitten baa in settlement of all claims by said counsel for

attorneys’ fees from the commencement of this action to the

entry of this Decree and such amount shall be paid within 15

days of the final entry of this Decree. (The parties have fol-

lowed the recommendation of Prandini v. National Tea Co.,

557 F.2d 1015, (3d Cir. ae) ae ee

A69

General by mail of the unintended result or ambiguous in-

terpretation. The parties shall have 30 days after the date of

such letter to resolve the problem. If the parties are unable

to reach agreement within such 30 days, the issue may be

submitted to the Court for resolution.

17. The Court retains jurisdiction of this action for such

further orders as may be necessary or appropriate to effectu-

ate the purposes of this decree.

18. Notice. The Court hereby gives its tentative approval

to this Consent Decree, subject to the notification of class

members and the provision of an opportunity for them to file

objections. The text of the notice to be is set forth in Exhibit

D. This notice shall be posted at each firehouse or other

Bureau facility of the Fire Department for a period of 15

days beginning Apri! 28, 1980, and mailed to each identified

class member listed in Exhibit B on that date. Class mem-

bers who file written objections within this period shall be

entitled to be heard on their objections at a hearing before

this Court on May 16, 1980. If no written objections are

filed within the 15 day period, this Consent Decree shall

become final without further action by the Court.

ENTERED, this 25th day of April, 1980.

/s/ ROBERT M. McRAE, JR.

UNITED STATES DISTRICT JUDGE

APPROVED:

/s/ RICHARD B. FIELDS

RICHARD B. FIELDS

RATNER & SUGARMON

ATTORNEYS FOR PLAINTIFFS

/s/ CLIFFORD D. PIERCE, JR.

CLIFFORD D. PIERCE, JR.

EDWARD R. YOUNG

J. DANIEL MORGAN

ATT©'"&NEYS FOR DEFENDANTS

A70

MEMPHIS FIRE DEPARTMENT

FIRE FIGRTING CLASS

(Data derived from inspection of

class pictures at the Memphis Fire

Department Training Center)

DATE BLACK

10-25-50

1-2-5]

2-20-51

6-17-51

12-5-5l

2-4-52

4-15-52

9-24-52

1-5-53

3-23-53

6-15-53

“3

eo

a

eescoooscoooscoooSooooosoooscooocoSoSo

12

SSUSSESsESys

A7l

BLACK

Bontmeons-NYaAnnKHwheHOowrwworoooscno

WHITE

SRERESSSRFEFSUPSSSSRSESRRSESES

A72

IN THE UNITED STATES DISTRICT COURT

FOR THE WESTERN DISTRICT

OF TENNESSEE

WESTERN DIVISION

NO. 77-2014

CARL W. STOTTS,

Plaintiff,

-VSs-

MEMPHIS FIRE DEPARTMENT, ET AL..,

Defendant.

NO. 79-2441

FRED L. JONES,

Plaintiff,

-VSs-

MEMPHIS FIRE DEPARTMENT, ET AL.

ORAL RULING OF COURT - MAY 8, 1981

THE COURT: All right.

I’m going to announce my findings orally at this time

and ask that proposed findings be drafted and available

for me when I return to the City a week from tomorrow.

I will be at a judicial conference, as will all of the

Judges in the 6th Circuit.

It would probably be better if we had more time to

pursue this procedurally. However, I think counsel has

done a good job of getting ready for a hearing on short

notice and advising the Court of the relative positions,

and taking the best approach.

A73

It is apparent, and the Court finds, that the Consent

Decree that was entered in these cases—and I have ref-

erence to Stotts and Jones versus the Memphis Fire De-

partment, which Decree was entered on April 25, 1980—

did not contemplate what method would be used for a

reduction in rank or layoff, because the City had never

laid anybody off until recently in 1981, and still hasn’t, in

the Fire Department. This was an agreement, that like

many agreements, that did not contemplate that circum-

stance.

Similarly, the Court finds that there was no specific

provision pertaining to layoffs in the Consent Decree for

the City wide case, which I believe was in Judge Wel-

ford’s Court, and that was in the early 70’s.

Therefore, this Court must consider whether or not,

under the facts and circumstances, it should exercise its

authority to modify a Consent Decree by directing the

City officials not to use the method which they have pro-

posed.

I do find that the adoption of this layoff policy was

not adopted with the intent or specific purpose to dis-

criminate against black, and I find no reason—well, neither

the layoffs nor the policy adopted was intended to be dis-

criminatory. However, I find it inescapable that the effect

is discriminatory.

While the agreement does not admit discrimination, it

would be naive not to realize that the Fire Department

of this City was very discriminatory towards black people

for years, and it really wasn’t corrected properly until

the Consent Decree was entered in this cause.

It is true that this Court never had hearings and made

findings, but I could take judicial notice of that from the

figures that are in the record in this Court.

A74

The purpose of these lawsuits was hiring and pro-

motion.

Now, the proposed layoff policy is based on city wide

seniority. Although we have no specific figures, I find

that there would be little seniority based upon members

of the Fire Department working in other departments of

the City. There may be some. The Director indicated

that there would, but not much.

The system would, of course, recognize seniority on the

date of hire in the Fire Department, and anybody who

had been promoted would have the benefit of that being

his seniority date for purposes of bumping or demoting.

+ Of course, there is a contract—or I shouldn’t say a

contract because we have gone through that charade.

/ The City does not recognize contracts with its employees

—labor contracts—so we call them memorandum of agree-

ment, or something. Well, there is whatever that is, and

it may have some bearing on this. If it is not a contract,

maybe it is not entitled to all of the sanctity of a contract.

But in any event, they have introduced two memo-

randum of understanding that were negotiated for and

arrived at, which does have the city wide seniority posi-

tion for layoffs.

However, because the effect of that, and the proposed

system is in effect discriminatory, I find that such a posi-

tion is not a bona fide seniority system.

While there is no proof that the City has been defiant

about its activities in this case—now, I am not too familiar

with the "74 case, but I know through the years from the

time that was entered until now, we still had a lot of dis-

pute even though the City had agreed to do right. We

still get lawsuits against the City, I believe every month.

But be that as it may, I really find it kind of—although

A775

they have not been defiant, and there is no suggestion

that they have been contemptuous, I find it a little awk-

ward for the City to be boastful and proud of a record of

eleven percent. I hope that is not the end of the line.

And to come in and say, “Yes, we have done fine.”

Well, it is going to be harder. And I agree that these

people who have obtained these ranks, they were hard

to come by. And there is still not anything to be proud of.

The figures show that in the lieutenant category,

there are two hundred and forty of them, two hundred

and eleven are white, twenty-nine are black.

In the driver category, three hundred and eleven of

them, fifteen are black, two hundred and ninety-six are

white.

Now, that may not reflect defiance, but it is not any-

thing to brag about either. And I do find that this layoff

policy would set that back. And I cannot—this is a pre-

liminary injunction hearing, and it may be that time

will give some assistance to whether or not the bumping

up process will be effective. Frankly, I think it is specu-

lative for the Court to make any finding on that. I am

not saying that it won’t happen.

And I realize that the layoff policy is hard to get a

handle on, and that Mr. Sabbatini is correct when this

thing changes day-to-day. And you are talking about

fifty-five people leaving from these bureaus, it might

not be fifty-five, it might be fifty-four or fifty-three. Well,

that is not a significant change, but it would be the fifty-

fifth person or fifty-fourth, as the case may be.

Therefore, I direct that the City not apply the city

wide seniority policy, insofar as it will decrease the per-

centage of lieutenants, drivers, and inspectors, and privates,

that are presently employed.

A76

Now, that may require two seniority lists, but frankly,

I don’t think that is so bad when you realize that the

present situation resulted from prior discrimination, which

is obvious.

Now, I am sure that this is going to create problems for

City personnel who already have many problems, and I’m

sorry for that. But at the same time, the Court believes

that the City should file a proposed plan for not violating

the Court’s injunction.

Now, I still maintain that I do not have the authority

to order that no members of the Union be laid off. I don’t

know what the policy will be with regard to that memo-

randum of understanding that the City signed with the

Fire Fighters Union.

In summary, I want the attorneys for the Plaintiff to

prepare, within the next week, proposed findings along

the lines I have just announced, and then a proposed form

of injunction which the Court will consider and sign.

However, I consider that the injunction is effective with

the Court’s announcement today orally. Regrettably, I am

going to be out of the city and canneot stop to do this.

Now, the injunction should direct the City to propose

another layoff policy or am amendment to their current

policy.

Now, are there any questions?

MR. FIELDS: Yes, Your Honor.

I think you said the number of persons.

By persons do you mean the percentage of blacks?

THE COURT: Right.

A77

(Filed May 18, 1981)

IN THE UNITED STATES DISTRICT COURT

FOR THE WESTERN DISTRICT

OF TENNESSEE

WESTERN DIVISION

CIVIL ACTION NO. C-77-2104

CARL W. STOTTS,

PLAINTIFF,

VS.

MEMPHIS FIRE DEPARTMENT, ET AL..,

DEFENDANTS.

CIVIL ACTION NO. C-79-2441-M

FRED L. JONES,

PLAINTIFF,

VS.

MEMPHIS FIRE DEPARTMENT, ET AL.,

DEFENDANTS.

ORDER GRANTING PRELIMINARY INJUNCTION

This cause cam

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