# Appendix — Daniel v. Pettway

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Appendix
- **Published:** January 1, 1984
- **Citation:** 467 U.S. 1243

## Text

83-1802

IN THE Supreme Court, U.S.
SUPREME COURT OF THE UNITED STATES Kb

October Term, 1983 ; MPR 30 198:

No. - -
ALEXANDER L. STEVAS

CTPRK

CHARLES L. DANIEL, et al.,
Petitioners,
VS.

RUSH PETTWAY, et al..
Respondents,

EQUAL EMPLOYMENT OPPORTUNITY COMMISSION
Respondent,

AMERICAN CAST IRON PIPE COMPANY
Respondent

APPENDIX TO
PETITION FOR WRIT OF CERTIORARI TO THE
UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT

Ralph E. Coleman

2175 1Ith Court South
Birmingham, Alabama 35205
(205) 939-0444

Counsel of Record for Petitioners,
Charles L. Daniel, et al

Ronald L. Spratt
1929 North Third Avenue North
Smith Towers, Suite 3200
Birmingham, Alabama 35203
(205) 251-7180
Attorney for Petitioners,
Charles L. Daniel, et al

OF COUNSEL

COLEMAN & COLEMAN

2175 IIlth Court South

Birmingham, Alabama 35205
(205) 939-0444

TABLE OF CONTENTS

Final Judgment and Rule 54 Certificate
Findings of Facts and Conclusions of Law ....
United States Court of Appeals, Eleventh Circuit
Petition tor Rehearing and Rehearing En Banc

Supplemental Affidavit of Robert L. Wiggins, Jr
and Time Record

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IN THE UNITED STATES DISTRICT COURT FOR THE
NORTHERN DISTRICT OF ALABAMA
SOUTHERN DIVISION

CIVIL ACTION NO, 66-315

RUSH PETTWAY, et al.,
Plaintiffs,

Vv.

AMERICAN CAST IRON PIPE
Defendant.

FINAL JUDGMENT AND
RULE 54 CERTIFICATE

With respect to the entry of the Consent Decree resolving all
Outstanding issues concerning monetary relief and fees and costs
associated therewith, itis hereby ORDERED, ADJUDGED and
DECREED in accordance with Rule 54 of the Federal Rules of
Civil Procedure:

1. That the Court hereby gives final approval to the proposed
Consent Decree which was tentatively approved on March 23,
1983,

2. That the Court directs the entry of final judgment pursuant
to the provisions of the Consent Decree, the terms of which are
incorporated herein by reference,

3. That the Court has determined that the terms of the
Consent Decree are fair, adequate and reasonable;

4. That this final judgment is binding and conclusive upon all
parties to this action and members of the plaintiff class consisting
of all black employees at America’s Birmingham, Alabama plant
who were employed as of, or hired subsequent to, July 2, 1965 to
the present;

5. That the entry of this final judgment and the Consent
Decree satisfy all the requirements of Rule 23 of the Federal
Rules of Civil Procedure; and

6. That the Court retains jurisdiction of the injunctive relief
aspects of this case as heretofore provided for in the Consent

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Decree of 1980 approved and entered by this Court on July 14,
1980

DONE this 12th day of May, 1983

SEYBOURN H. LYNNE
United States District Judge

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IN THE
UNITED STATES DISTRICT COURT
FOR THE
NORTHERN DISTRICT OF ALABAMA
SOUTHERN DIVISION

CIVIL ACTION NO. 66-315

RUSH PETTWAY, et al.,
Plaintiffs,
v.
AMERICAN CAST IRON PIPE COMPANY,
Defendant.

FINDINGS OF FACT AND CONCLUSIONS OF LAW

The current case is before the Court once again on the tssue of
monetary relief which was first remanded by the Court of
Appeals in 1974. The history of this case scarcely needs repeating
at this late date. It has been adequately set torth in the previous
decisions of the Court of Appeals and this Court. Nevertheless,
there are certain salient events which should be stressed as
background to the consideration of the particular terms of the
proposed setilement and objections which are before the Court.

The case was tried in October, 1971 and findings of fact and
conclusions of law were entered in November, 1972. See, 7 FEP
Cases 1010 (N.D. Ala. 1972). The Court found that the
defendant's testing program violated Title VII under the
standards established in Griges v. Duke Power Co.,401 U.S. 424
(1971). It also concluded that the departmental seniority system
did not violate the Act and that the defendant had “practiced no
invidious racial discrimination in the administration of its
apprenticeship and journeyman programs.” 7 F’P Cases at
1018-1019, On the issue of back-pay, the Court concluded that it
should not be awarded “in view of the demonstrated good faith
compliance by defendant with Title VII... and because such an
award is not necessary to insure future compliance therewith.”
Id. 7 FEP Cases at 1019. On appeal the judgment was reversed
and remanded with instructions to award certain injunctive relief
and back-pay. Pettway v. American Cast Iron Pipe Co.,494 F.2d
211 (Sth Cir, 1974) (“Pettway". hereafter.).

A-4

The proceedings on remand in 1974 and 1975 are accurately
summarized in the prior decrees and judgments of the Court
entered on May 14, 1975, June 12, 1975 and November 20, 1975.
On the latter date, the Court entered a Final-Order and Modified
Judgment in which the proceedings on remand from Pettway,
//I, supra, were summarized. A further description of the
proceedings which resulted in the June 12, 1975 Judgment is
found in the 1978 decision of the Court of Appeals in this case.
See, Pettway v. American Cast Iron Pipe Co., 576 F.2d 1157,
1172-1175 (1979), cert. denied, 439 U.S. L115 (1979) (“ Pettwas
/V". hereafter). The Court has carefully reviewed all of the prior
proceedings in this action and has taken such proceedings into
consideration in determining the fairness, reasonableness and
adequacy of the proposed settlement and the adequacy of the
representation of the class by the named plaintiffs and the
attorney for the class.

Pursuant to the Court's Final Order of November 20, 1975, the
Clerk of the Court entered a Judgment Setting Aside and
Annuliing Back-Pay Awards to 442 Persons Listed On Attached
Certified List on January 14, 1976. An appeal had been
previously taken by these 442 persons and by an assortment of
other segments of the class. The complicated procedural posture
of the case is accurately described in Pettway /V, supra at 1166-
1168. There were a total of 2242 class members as of 1975. Of that
group a subclass of 841 persons had been awarded back-pay in
the June 12, 1975 Judgment and 1401 class members had been
excluded from participating in the back-pay recovery. All of the
1401 members of the latter group were persons hired after July 2,
1965 whom the Court had determined not to have been
monetarily injured by the unlawful practices of the defendant.
Only 150 of these 1401 class members objected to their exclusion
from the back-pay subclass. The 841 members of the back-pay
subclass reacted to the 1975 back-pay award in different ways. As
already mentioned, 442 of such subclass members refused to
accept their back-pay tender and 399 accepted such tender and
executed a release. Of the latter group of 399 subclass members,
252 of them were characterized by the Court of Appeals as having
“accepted checks and not appealing decision.” Pettway /V, supra

A-5

at 1167. The remaining 147 subclass members who cashed their
1975 back-pay checks were characterized as “objectors” by the
Court of Appeals. /d. The total number of back-pay subclass
members who were found to have either objected to the back-pay
or signed the notice of appeal in 1975 was 589. /d.

On remand from Pettway /V, supra, the procedural structure of
the class was further complicated. On October 25, 1979 the Court
ordered that every member of the class be given notice of the
status of the case and be given the opportunity to notify the Court
of their interest in participating in the back-pay proceedings on
remand. The notices to the class were sent by certified mail to the
homes of over 2400 persons in late October, 1979. They were
given until December |, 1979 to file a Notice of Intent to
Participate in Back-Pay. Approximately 1215 class members
timely returned such Notices to the Clerk of the Court. The
parties then settled the injunctive features of the cause that had
been remanded in the fourth appellate mandate. Notice o the
proposed entry of the Consent Decree of 1980 was given to the
class and a hearing was held on objections on July 14, 1980. A
number of the objections concerned the bifurcation of the
settlement process into injunctive and back-pay halves. The
Court carefully considered these objections in its Findings of
Fact and Conclusions of Law entered July 25, 1980 and reached
the following conclusion.

13. This Court has expressed ina writen Order entered
on June 18, 1980 its firm intent to ‘proceed forthwith with
all possible speed to adjudicate the back-pay claims of all
affected employees’. The Court informed counsel for
both parties at the close of the July 14, 1980 hearing that
it expected them to proceed immediately with
negotiations aimed at settling all remaining monetary
issues and that if such issues could not be settled with
some dispatch, the Court would set the wheels in motion
for a trial of the back-pay claims of each class member.
Such remains the intent of this Court. The parties are
again instructed to expedite their review of their
respective positions and to make all reasonable efforts to
resolve their differences over back-pay with all possible

A-6

speed. If this cannot be accomplished, the Court will set
the back-pay claims down for trial at the earliest
opportunity after the parties have notified the Court that
their efforts have failed.

14. For these i:easons, the Court finds that the
objections concerning the bifurcation of the back-pay
issues from the injunctive issues are not supported by any
evidence or rationale and does not deprive the proposed
Consent Decree of the fairness, adequacy, and
reasonableness necessary for its approval.

It is significant that of the nine class members who objected to
the settlement of the injunctive relief separately from the back-
pay. only one of such class members has entered an objection to
the current back-pay settlement proposal.

The events surrounding the approval of the Consent Decree of
1980 bear some importance to the approval of the back-pay
settlement now before the Court. As just mentioned, the class was
informed by the Court at the July 14, 1980 hearing on the
injunctive settlement that the Court expected serious efforts at
settlement of the back-pay issue to be accomplished
expeditiously. The attorney for the class and the ciass
representatives told the class at its regular monthly meetings
during the latter half of 1980 that back-pay settlement efforts
were being made. Similar notice to the class was given by the class
attorney and the class representatives throughout 1981, both
orally and in writing. At no point did ‘any member of the class
step forward and object to back-pay settlement negotiations on
their behalf by the attorney for the class and the class
representatives. For this reason, among others, the Court is not
impressed with assertions by certain objectors that they were
excluded from the back-pay settlement process.

After approval of the injunctive settlement in July, 1980, the
parties attempted to reach an agreement that would settle the
remaining monetary issues in the case. The parties, however,
were very far apart in their veiw of an adequate back-pay award.
The greatest amount offered by the Company during that period
was approximately 1.4 million dollars. The latter amount

A-7

included the approximately $483,000 which had been cashed in
1975 by 399 class members. Thus, the total additional amount of
mouey which was being offered in excess of the one million
dollars tendered in 1975 was less than $500,000. The attorney for
the class and the class representatives were in agreement that
settlement discussions in that range of recovery were
unacceptable. While the class attorney believed that negotiations
should be continued, the Committee For Equa! Job Opportunity
elected to terminate such discussions and begin preparation for
trial of the back-pay issues. This decision was reported to the
class at its regular monthly meetings in September and October,
1980 and was reported to the Court in the first week of October of
that year.

On October 20, 1980 the Court ordered that notice be given to
the class of its duty to individually answer interrogatories
propounded to the class by the defendant. The interrogatories
and the notice to answer them were mailed to all class members
who had filed a Notice Of Intent To Participate In Back-Pay.
They were given 90 days to answer such interrogatories and
another 90 days in extensions were subsequently granted by the
Court. Ultimately only 833 class members responded to the
interrogatories out of the 1215 persons who had given notice of
their intent to claim back-pay. All of such class members were
interviewed by and given the assistance of the attorney for the
class in responding to such interrogatories. In this regard, the
Court pauses to note that the current back-pay settlement does
not condition participation in the recovery on filing a response to
the interrogatory answers. A substantial number of the class
members who are scheduled to receive back-pay under the
proposed settlement would be excluded if the parties had
conditioncd participation on the filing of interrogatory answers.

Afier further discovery skirmishes which are too tedious to
men:ion, the plaintiff proposed that the Court appoint a Special
Master for the purpose of acting as a mediator in settlement
discussions. On June 2, 1981 the Court granted that request,
which was unopposed by the defendant, and appointed William
F. Gardner as a Special Master for the limited purpose of
conducting settlement negotiations. After numerous meetings

A-8

between the parties and the Special Master, settlement
negotiations once again failed. This was reported to the Court by
the Special Master on July 7, 1981. The respective positions of
the partes were still far apart. Although a settlement offer was
never made by the defendant for an amount greater than the 1.4
million dollars that was rejected in September, 1980 by the
plaintiffs, the defendant did discuss figures which went as high as
1.7 or 1.8 million. Such amounts, however, continued to contain
offsets or credits for the $483,000 that was cashed in 1975. In
terms of “new” money, the Company did not contemplate any
offers greater than 700 or 800 thousand dollars more than had
been tendered in 1975.

After settlement efforts once again were terminated, the Court
held a conference with the parties on July 17, 1981 and entered an
Order of Referral to Special Master which referred the entire
back-pay issue for trial on an individual-by-individual basis. The
plaintiff class strongly opposed such a method of trial and also
opposed any effort by the Company to make an Offer of
Judgment directly to individual members of the class. An appeal
of the Court's allowance of the latter was immediately filed. A
Petition For Writ Of Mandamus was also filed challenging both
the permission to mail an Offer of Judgment directly to the class
members and the referral to a Special Master for individual-by-
individual trials. The Petition For Writ Of Mandamus was
denied but the plaintiffs then filed an appeal challenging the same
issues. The Court of Appeals accepted the interlocutory appeal
and vacated the Order of Referrai and the Order allowing direct
mailing of an Offer of Judgment. Pettway v. American Cast Iron
Pipe Co., 6&1 F.2d 1259 (11th Cir, 1982). Ina companion appeal,
the E.E.O.C. was also reinstated as an intervenor in the case.
Pettway v. American Cast Iron Pipe Co., 681 F.2d 1269 (11th
Cir. 1982). The Company then filed a Petition For Writ Of
Certiorari to the Supreme Court. That Petition is still pending
and will not be reviewed by the Supreme Court unless the
proposed settlement is disapproved by the Court.

The foregoing procedural background is important in
assessing the adequacy of the representation of the class and the
overall fairness of the proposed settlement. It is also important as

A-9

a preface to the objections which have been filed by certain class
members. The Court now proceeds to consider whether the
proposed settlement should be approved.

I. THE TERMS OF THE PROPOSED SETTLEMENT

The proposed settlement involves a total payment from the
defendant of $3,983,401.91 in satisfaction of all monetary claims
for racial discrimination which have been asserted as a part of
this action. Of this amount, the defendant has aiready paid
$483,401.91 to 399 members of the class as a result of the abortive
settlement in 1975. The remaining $3,500,000 required to be paid
by the proposed Consent Decree has been gathering interest since
March 8, 1983 at a rate equivalent to the “open ended” REPO
rate on U.S. Treasury Bills quoted by the First National Bank of
Birmingham ona daily basis. The total value of the settlement of
the monetary issues in this case substantially exceeds four million
dollars when the interest provided in the proposed Decree is
included. This figure, of course, does not include the very
valuable benefits secured for the class as a result of the previous
settlement of the injunctive features of the case which are
embodied in the Consent Decree of 1980.

The approximately four million dollars secured by the
proposed settlement is not a fund which was negotiated in the
abstract by the parties. It is comprised of various funds which
were calculated and negotiated separately from one another.
These separate funds are set forth in the proposed Consent
Decree and need not be repeated herein. The various methods of
division of each of these funds among the class members meeting
the conditions of eligibility for participation within each fund is
set forth in the Schedule of Distribution and Division of Back-
Pay and Costs which was filed with the proposed Consent
Decree.

The proposed settlement does not call for each member of the
class to participate in the recovery. Only those class members
who filed a Notice of Intent to Participate in Back-Pay in 1979
are eligible to participate under the terms of the proposed
settlement. Of that group of 1215 persons, the parties have agreed
that no class member who had less than two years of service prior

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to January 1, 1979 coud have beer monetarily injured by the
unlawful practices found in this case.

Il. FACTORS FAVORING APPROVAL

Before considering the validity of the various objections that
have been filed, the Court must address the question of whether
the proposed settlement should be approved even in the absence
of any objections. The burden of proof of the fairness, adequacy,
and reasonableness of the proposed settlement is upon its
proponents. The proponents in this case are the defendant
Company, the class representatives, the attorney for the class, the
Committee For Equal Job Opportunity, and the vast majority of
the class itself. In addition, the Equal Employment Opportunity
Commission as an intervenor in this action has expressed its
approval of the proposed settlement. Unlike many class actions
in which the class is unaware of the terms of the settlement until
after it is reached, the class in the current case was kept informed
of the terms of the settlement and allowed to vote on itasa group
before it was ever incorporated into a Memorandum Of
Understanding between the parties. At the monthly meeting with
the class in January, 1983 the terms of the proposed settlement
which were eventually agreed upon in March were explained to
the several hundred class members in attendance and all but five
persons voted in favor of it. While such vote is not binding upon
the parties or the Court, it does signify that the proponents of the
settlement include more than the class representatives and the
class attorney. It includes the entire Committee For Equal Job
Opportunity and it includes over 95% of the class.

In a very real sense, this case is now the mirror image of itself as
it existed during the fourth appeal. In Pettway /V, supra, the
Court of Appeals observed that:

All of the active named plaintiffs, all of the elected
representatives on the Committee For Equal Job
Opportunity, and 70 percent of the subclass objected to
the settlement. ***If 100 percent of the subclass had
objected we could say with complete confidence that ‘the
class’ has not settled its claim. At least under the limited
circumstances of this case, our confidence is not shaken

A-11

when the figure is reduced to 70 percent. Where sucha
large percentage of the class objects there must be
something, not necessarily rotten in Denmark, but unfair
to the principality consisting of a class as a whole. The
district court abused its discretion in approving this back-
pay agreement. /d. 576 F.2d at 1217-18.

Now we have the opposite and more compelling situation.

The Court, however, is not content to simply count the number
of objections and observe that they are less than 5% of the class.
The Court agrees with and is bound by the reasoning contained in
Pettwayv 1V, supra at 1217, to the following effect.

While majority rule is not the test in every case, in the
context of determining the total back-pay award
majority sentiment becomes highly relevant. We stress
that this is not a dispute over the allocation of a settlement
fund, with respect to which the court should not allow a
majority, no matter how large, to impose its decision on
the minority. In such circumstances, objection by a few
dissatisfied class members should trigger close judicial
scrutiny to ensure that the burden of the settlementis not
shifted arbitrarily to a small group of class members.
Here the dispute centers around the sufficiency of the
settlement fund. Each subclass member's interest in the
size of this fund is substantially the same and there are no
conflicts of interest among definable groups within the
subclass. The decision to approve this settlement thus
may appropriately be described as an intrinsically ‘class’
decision in which majority sentiments should be given
great weight. /d. 576 F.2d at 1157.

For these reasons, the Court places considerable weight on the
fact that over 95°7 of the class has not objected to the proposed
settlement insofar as the question of the adequacy of the total
award is concerned. As to the allocation of the total award,
however, the Court places less emphasis on the percentage of
objectors. Instead, close judicial scrutiny of the validity of the
allocation of the back-pay among the various segments and
members of the class is required.

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Even as to the adequacy of the total recovery, the Court does
not rely exclusively on the fact that the class representatives and
the majority of the class have expressed their approval. While the
Court has not reviewed the monetary value of the settlement ina
vacuum, it must be concluded that the amount obtained by the
plaintiffs is impressive standing alone. In no sense can it be
labeled as a token payment unworthy of the most serious
consideration by the class. The Court is unaware of any back-pay
recovery in the Northern District of Alabama which has
approached the magnitude of the recovery set forth in the
proposed Consent Decree in this case. There have been many
comparable cases in this District in the nearly eighteen years since
the Civil Rights Act of 1964 became effective and none of them
have involved a greater collective or average individual recovery
for the members of a class than does this case.

A comparison with similar cases is not the only benchmark
which tndicates the adequacy and reasonableness of the total
recovery. The experts for both parties have conducted extensive
calculations of back-pay based on differing reconstructions of
what would have been expected to occur in employee job
movements in the absence of the racial discrimination found in
this case. These calculations were done separately by each expert
based on a computerized data bank extracted from the employee
records of the defendants. The computer print-outs containing
the calculations of the plaintiffs’ expert were made available to
the attorneys for the objectors and to any objector who requested
it. Only one of the attorneys for the objectors took advantage of
this opportunity and examined the plaintiffs’ expert's
calculations. None of the objectors did so. The calculations of
the opposing experts differ from one another in the method of
calculation but, when considered together, demonstrate that the
proposed settlement amount is within the range of the total
recovery which could be expected to be obtained by the class at
trial.

Not unusually, the defendant's expert states that the total
settlement is on the high side of what the plaintiffs might have
expected to recover at trial while the plaintiffs’ expert states that
it is on the low side. This result, however, supports approval of

A-13

the settlement, not disapproval. The surest indication of a fair
compromise is when two vigorous advocates have made
concessions to the point that they both believe the other side has
obtained the best of the bargain. That is exactly what has
occurred in the current case. A considerable part of the
dissatisfaction of the objecting class members is nothing more
than the lingering suspicion, engendered by hindsight, that
another dollar in concessions could have been wrung from the
process of negotiation. If approval of a settlement depended
upon the absence of such ever-present doubts, then no class
action would ever be settled.

None of the objectors have offered any basis upon which the
Court could conclude that the total recovery is less than what the
plaintiff class could realistically expect to recover at trial. Indeed,
they have shown a remarkable lack of interest on the entire
question of the adequacy of the overall settlement fund or in how
it was calculated. Not only did they fail to take advantage of the
Opportunity to inspect the detailed calculations of the experts,
but they failed to even request the opportunity to depose or cross-
examine either expert prior to or during the fairness hearing. If
there were any serious contention that such calculations were
unfair, unreasonable, or inadequate the Court would expect that
the objectors would have cross-examined the experts on such
contentions either at a deposition or at the fairness hearing.

For the Court's part, the expert calculations are found to be an
accurate and complete accounting of the monetary effects of the
racial discrimination involved in this case. The calculations
performed independently by the experts retained by both parties
fully support the contention that considerably less than the
amount provided in the proposed settlement might have been
recovered at trial. The Court can find no plausible basis to
conclude that the plaintiffs had a reasonable likelihood of
recovering a substantially greater amount at trial. For these
reasons, the Court concludes that the proponents of the
settlement have carried their burden of establishing the fairness,
adequacy and reasonableness of the total monetary recovery.
The objectors have failed to seriously content otherwise and the
evidence fully supports the position of the proponents.

A-14

The contentions found in the formal objections filed prior to
the fairness hearing do not concern the adequacy of the total
amount recovered. Rather, they contend that the allocation or
distribution of the total settlement is unfair and unreasonable.
This contention takes several forms, some of which conflict with
one another. First, a group of 51 class members who cashed their
checks and executed releases in 1975 argue that they should have
received shares which were exactly equal to comparably senior
class members who rejected their individual awards in 1975.
Secondly, a group of 23 class members who rejected their 1975
back-pay awards argue that they should have received larger
individual shares of the total recovery.' Oddly enough, these two
groups of objectors do not support one another.

A. Treatment Of The Class Members Who Cashed
Their Checks And Executed Releases in 1975

As already mentioned, there were 399 class members who
accepted their back-pay awards and executed releases of all
claims in 1975. In late 1979 those 399 class members were given
the opportunity to file a Notice Of Intent To Participate In Back-
Pay. A Notice explaining their right to signify their interest in
participating in the back-pay proceedings was sent to the homes
of the 399 class members who cashed their 1975 checks in
October, 1979. Only 257 of them responded to the Notice by
filing a Notice Of Intent To Participate In Back-Pay. Of the 142
who did noi respond, eight have now filed objections to the
proposed settlement. At the hearing on objections held May 12,
1983, these eight class members failed to offer any excuse for not
following the instructions in the 1979 Notice to the class by filing
the required Notice Of Intent To Participate In Back-Pay. After
having cashed their checks and executed releases in 1975 and
having ignored the requirement of filing a Notice Of Intent To
Participate in 1979, it is too late for these eight class members to
expect the remainder of the class to give up the recovery
contained in the proposed Consent Decree so that they can
belatedly be included in the back-pay distribution. The

‘Objections which do not fall into these two groups are discussed at a later
point of this Opinion.

A-15

proponents of the sett!zment have fully satisfied the Court that
the proposed seitiement is fair, adequate and reasonable in
conditioning distribution of the back-pay upon timely filing the
1979 Notice Of Intent To Participate.

The 257 class members who executed their back-pay checks
and the attached releases in 1975 and who filed the 1979 Notice
Of Intent To Participate are sharing in a total fund of $128,500.
Of these 257 class members, only 43 have objected to their
individual share of the recovery. The remaining 214 class
members are apparently in support of the proposed settlement,
even though there was an active effort on the part of the 43
objectors to solicit opposition against the settlement. The Court
does not fault the efforts to solicit those who cashed their 1975
back-pay checks against the settlement. Once that effort has
produced only 43 objections, however, that fact takes on some
degree of relevance in assessing the validity of the objector’s claim
that they were abusively treated during the settlement
negotiation process. It also bears on the Court's assessment of the
fairness, adequacy, and reasonableness of the overall recovery of
this particular segment of the class.

The relative paucity of objectors from the group of class
members who cashed their 1975 checks is not the only indication
of the lack of merit of the objections from this group. The
attorney for the class brought the contentions of this group to the
Court’s attention prior to the preliminary approval of the
Consent Decree. The Court considered these objections on a
preliminary basis in its Findings of Fact and Conclusion of Law
Giving Preliminary Approval To Proposed Consent Decree
entered March 23, 1983. Even though these findings were entered
six weeks prior to the fairness hearing on May 12, 1983, none of
the objectors have contended or submitted evidence which
suggests that any of such findings and conclusions were
erroneous. The Court has now considered such findings and
conclusions again in light of the evidence and arguments offered
at the May 12, 1983 fairness hearing. After doing so, the Court
finds that the preliminary findings and conclusions entered in
support of preliminary approval of the settlement are fully
supported by the evidence. The Court has given close scrutiny to

A-16

the entire treatment of the class members who cashed their checks
and executed releases. That scrutiny has included a review of the
Court's own treatment of the objections of this group of class
members in the opinion giving preliminary approval to the
settlement. Even when considered in the light most favorable to
these objectors, however, the Court is convinced that their
interests have been adequately represented by the class
representatives and the attorney for the class and that the
settlement is fair, adequate and reasonable in the provisions
made for the class members who accepted their back-pay awards
in 1975.

The objections of these class members stem from a fallacy in
their view of the settlement negotiation process. Underlying their
entire position is the assumption that the parties negotiated the
total recovery as a lump sum and then set about to allocate it
among the different segments of the class according to some
arbitrary notion of relative merit. That assumption has been
shown by the evidence to be false. The total recovery is merely the
sum of its parts. Each amount allocated to the differing segments
of the class, and to the class attorney and expert, was negotiated
separately and independently from every other part. Each
discrete segment of the class had to stand on the strength of their
own claims rather than borrowing from the strength of some
other group in an effort to leverage a greater recovery than their
claims merited on their own. This is the real point of departure
for the dissatisfaction of the 43 objectors who cashed their checks
in 1975.

The Court is unable to fault the process of negotiation
followed by the parties in this case. There is nothing inherently
unfair in requiring the claims of each discrete segment of the class
to rise or fall in the negotiation process on the strength of their
own claims, rather than on the strength of some other segment of
the class. The claims of the group of class members who cashed
their checks and executed releases involved distinct legal
problems which wer» not involved in the claims of the remainder
of the class. These problems are correctly set forth in the Findings
Of Fact And Conclusions Of Law Giving Preliminary Approval
To Proposed Consent Decree entered on March 23, 1983. Those

A-17

findings and conclusions are adopted and reaffirmed by the
Court on the basis of the evidence received at the hearing on
objections on May 12, 1983.

The objectors have not presented any persuasive evidence that
their claims were stronger than they were assessed by the class
representatives during the negotiation. There is no credible
evidence which indicates that any of the 43 objectors who cashed
their checks and executed releases were covered by the November
20, 1975 Order of this Court or by any other event which occurred
during that period. To a man, those checks and releases were
executed freely and voluntarily.

The Court finds that the value placed on the claims of this
group of objectors by the parties to the settlement ts fair,
adequate and reasonable. The Court of Appeals recognized in
Pettwav IV, supra at 1221, n.&2. that “some or all subclass
members might receive a smaller back-pay award on remand
than their present share of the settlement.” While the objectors
take the amounts they cashed in 1975 for granted, the parties to
the settlement and the Court do not. There was the very real
possibility that some or all of the class members executing their
back-pay checks in 1975 could have received less at trial and
would have had to retund their overpayment with interest to the
defendant. /d at 1221. The current settlement avoids that risk by
allowing the class members to keep the amount received in 1975
and to receive an additional sum in the current settlement. The
objectors have not presented any evidence which indicates that
they reasonably could expect to have received more by going to
trial. The recovery provided by the proposed settlement for the
class members who executed their back-pay awards in 1975
amounts to $611,901.91 in back-pay plus the value of the use of
the money for eight years and the increased monthly pension
payments resulting from the 1975 award. The Court finds that
under all the facts and circumstances presented, the proposed
settlement is fair, adequate and reasonable in the amount
allocated to this group of class members.

In addition to their objection that they were inadequately

represented in the settlement negotiations, this group of
objectors also included certain other contentions within their

A-18

written objections. Each of the 43 objectors who accepted their
1975 back-pay awards filed the same form objection. All of them
contained several contentions which are frivolous on their face.
First, they state that the proposed monetary settlement “has not
been enforced by means of injunction.” The injunctive Consent
Decree of 1980 was entered by this Court in July, 1980 and is a
matter of court record. Each of these 43 objectors were given
notice of such Consent Decree and an opportunity to object.
None of them did so. The Court has retained jurisdiction over the
injunctive Consent Decree since July, 1980 for the purpose of
entering any additional or different relief which may be
appropriate but none of these objectors have ever come forward
to request such additional injunctive remedies. The Court finds
that this objection is without even the semblance of merit.

Secondly, the form objections state that “(p)lay rates, seniority
and promotion (were) not used to calculate the amount paid to
each class member.” The evidence presented at the hearing on
objections was to the contrary. The amounts received by the class
members who accepted their back-pay checks were calculated
according to a formula devised by the Court itself in the
Judgment entered June 12, 1975. That formula took into account
a class member's seniority and the highest job and pay rate he
attained with the defendant. The formula used to determine
individual shares in the current settlement also took into account
seniority and or the highest job and pay group attained by each
class member. The objectors have failed to present any evidence
which supports their contention on this point.

Thirdly, the form objections state that the “(c)heck cashers did
not agree to settlement fund made subject to notice.” Again, the
evidence fails to support this contention. Only 43 out of 257
“check cashers” who filed a Notice Of Intent To Participate In
Back-Pay have objected. All of the “check cashers” were allowed
to attend the meetings of the class held in January, February, and
March of this year and voice their objection to the proposed
settlement before it was agreed to by the class representatives.
None of them spoke against the “settlement fund” at tl 2se
meetings. The objectors have failed to present any contrary
evidence. Moreover, there is not any legal requirement that every

A-19

individual member of the class “agree” to a settlement. It is
enough that the settlement be agreed to by the class
representatives so long as it 1s fair, adequate and reasonable.

Fourthly, the form objection states that the class members
filing it “(o)bject generally to subclassification of the check
cashers.” There has been no certification of the check —cashers as
a subclass in this case. No party or class member has ever moved
for such certification and the Court finds that it would have been
inappropriate and unnecessary even if they had so moved. The
class as a whole has been vigorously represented by the class
representatives and their attorney throughout the period since
the 1975 back-pay awards were accepted by these objectors. Not
only were the specific interests of the class members who accepted
their 1975 awards represented, but they were successfully
represented by the existing class representatives and attorney for
the class. The Court is unable to find any evidence which
supports a contention that subclasses should have been
structured or that the representation of the entire class has been
inadequate.

The remaining contentions contained in the form objectfons
filed by the class members who accepted their 1975 back-pay
awards have been carefully considered by the Court in light of all
of the evidence presented. The Court finds that such objections
are frivolous and without any evidentiary support in the record.
The Court also finds that the treatment of the class members who
cashed their checks in 1975 by the class representatives and the
provisions made for such class members in the proposed
settlement are fair, adequate and reasonable.

B. Class Members Who Are Not Participating
In The Proposed Back-pay Distribution

There are two groups of class members who have objected
because they have been excluded from participating in the
proposed back-pay distribution. One group of 8 objectors
complains about the reliance on timely filing of the Notice Ot
Intent To Participate In Back-Pay asa precondition for receiving
ack-pay. A second group of 24 objectors complains about the
requirement that a class member have at least two years of service

A-20

prior to January, 1979 in order to be included in the back-pay
distribution. The Court finds both of these objections to be
without merit

Every person who has worked at the defendant's plant since
July 1, 1965 was eligible to participate in the back-pay
calculations if he met two Prerequisites: (1) he filed a timely
Notice Of Intent To Participate In Back- Pay in 1979. and (2) he
had at least two years of service prior t) January, 1979. These
requirements were-based on the knowledve of both parties that
notevery black employee desired to be promoted or was everina
position to be promoted. A large number of the 2400 members of
the class only worked a few days or weeks with the defendant
before they quit or were discharged.’ Another large sector of the
Class was hired after the remedial decrees in this case had ended
the unlawful testing and other discriminatory practices involved
in the case. For this reason, both parties desired to narrow the
Class to that group which had some plausible basis for making a
claim that they were denied a Promotional opportunity because
of their race. At a period in the case when there were no
settlement negotiations over the back-pay issue even
contemplated, the parties agreed that every member of the class
should be given notice of the status of the Case and an
Opportunity to signity his belief that he had been denied
Promotional opportunities because of their race. The Court,
independently from the parties, also determined that such Notice
should be provided Accordingly, the Court ordered on October
25, 1979 that notice be given to the class telling them that they
must file a Notice Of Intent To Participate In Back-Pay before
December |, 1979

When the responses to the Notice were received, it was learned
that approximately 160 of the 1215 Persons responding to the
Notice had not even completed the six month probationary
period after hiring. Since all employees, black and white. are
ineligible for promotion during such probationary period, it was
known by both parties that further refinement of the class eligible
to receive back-pay was needed. The parties independently

a
This action does not involve issues of hiring or discharge

A-21

studied the question of which segments of the class had too little
seniority to have had a realistic expectancy of being promoted in
the absence of racial discrimination. Through such studies the
parties determined that no class member who did not have at
least two years of seniority before January 1, 1979 could have
been affected by the racially discriminatory practices which are
the subject of this action. The latter date corresponded to the
entry of the Interim Order by the Court after remand from
Pettway IV. supra. That Order provided all of the injunctive
relief to which the Court of Appeals had held the class entitled in
Pettway Ill and 1V. That date is consistent with the decision in
Pettway I11, supra at 258, which stated that “(t)he termination
date of the back-pay period for most claimants will be the date of
the district court’s decree implementing our decision . . .” /d.

Based on all of the evidence and the Court's intimate familiarity
with this lawsuit, the exclusion of any class members who had less
than two years service prior to January |, 1979 or who did not file
a Notice Of Intent To Participate in 1979 is fair, adequate, and
reasonable.

C. Class Members Who Claim Their Individual
Share Should Be Greater

There are 16 class members} who rejected their 1975 back-pay
awards who are scheduled to receive varying amounts under the
proposed decree ranging from greater than $16.000 to as little as
$3,000. There are also 6 class members hired after July 2, 1965
who did not participate in the 1975 back-pay tender who are
scheduled to receive varying amounts in the propose | settlement
based on their seniority with the defendant. Both of these groups
claim that their individual share of the total settlement should be
greater. Because the back-pay for these two groups was
calculated and negotiated according to different standards and
considerations, they are considered separately.

The six objecting class members hired after July 2, 1965 who
did not receive any back-pay in the 1975 tender are the following:

‘One objecting class member who fell into this category, Ben Clark, has
withdrawn his objection with the Court.

A-22

Gregory Hrabowski
John Jenkins
James Mason
Cornelius Moon
Thomas Porter
William Skones

All of these class members were hired after 1969. None of them
were ever subjected to any of the pencil and paper tests which lie
at the heart of the liability of the defendant. The years that they
have spent in the defendant’s employ have been years in which
promotional opportunities have been under constant court
supervision and a series of remedial decrees designed to provide
equal opportunity for the black employees. In the Final Order
and Modified Judgment entered November 20, 1975 this Court
found “that no black employee employed subsequent to July 2,
1965 has suffered any economic loss due to the Company’s testing
and educational requirements or from any other alleged
discriminatory practice.” /d. at p.4. In Pettway /V, supraat 1210-
1213, the Court of Appeals recognized that this group of class
members had not yet entered Stage II proceedings in which they
were entitled to a presumption of back-pay.

The parties necessarily took the procedural and historical
status of the post-1965 segment of the class into account in
negotiating the settlement fund allocated in the proposed
Consent Decree for this group. The Court is satisfied that the
fund allocated to this group as a group is fair, adequate and
reasonable. There are 266 class members who are scheduled to
participate in the back-pay distribution who were hired aftez July
2, 1965. Only 6, or 2.2%, have objected to the amount allocated.
These 6 have failed to produce any evidence which indicates that
the group qua g-oup of post-1965 hires are entitled toan amount
greater than they are receiving in the proposed settlement. On the
other hand, the calculations of the experts retained by the parties
show that they could have received substantially less at trial. In
fact, the group as a group may have been excluded from even
entering Stage II proceedings under the mandate of Petrway /V,
supra at 1210-1213, if the settlement in this action had not been
reached.

A-23

More importantly, the objections of these 6 class members are
not couched in terms of an objection to treatment of the post-
1965 group qua group. The objections actually focus on the
individual amounts scheduled to be received by each of them in
the settlement. In short, they want more. The formula used to
calculate their individual share, however, is a reasonable one. It is
based solely on seniority and is identical to the one approved by
Judge Guin in James v. Stockham Valves & Fittings Co., CA#
70-178-S (Option dated November 16, 1981). The Court of
Appeals in Pertway ///, supra at 260-261, recognized that any
method of calculation or division “creates a quagmire of
hypothetical judgments” and is nothing more that a “process of
conjecture.” /d. The proponents of the settlement have carried
their burden of proving that the method of calculating individual
shares is as fair, adequate and reasonable as any other method
that is available.

As to the group of 16 objectors who were hired before July 2,
1965 and who rejected their back-pay award in 1975, the Court
reaches the same conclusion. There are 426 class members who
are within the same category who support the settlement and
have not objected. This fact is entitled to considerable, although
not decisive, weight. See, Pertway /V, supra at 1217-1218. Of
equal importance is the fact that the amount allocated to this
group qua group is $2,520,083. In 1975 this Court found that
$516,598.10 was fair, adequate and reasonable for this same
group of class members. The Court of Appeals did not reverse
this finding per se but held thata settlement should not have been
forced upon the class in view of the large number of objections
which were found. Pertway Jb, supra at 1217-1218. The current
settlement has increased the back-pay fund available to this
segment of the class nearly 500°. The calculations of the experts
retained by both parties establish that the settlement fund
available to this largest group within the class is within the range
of what they could expect to receive at trial. The evidence is clear
and convincing that the fund allocated in the proposed settlement
for the class members who rejected the back-pay tender in 1975 1s
fair, adequate and reasonable. The 16 objectors from this group
have failed to present any evidence which wou'd support a
contrary conclusion.

A-24

While the remaining contentions contained in the objections
filed by these 16 class members are obviously without merit, the
Court is compelled to address them out of an abundance of
caution. First, several of the objectors state that they were not
informed of the expected testimony of the expert retained by the
plaintiffs prior to receiving notice of the proposed settlement.
The evidence showed to the contrary. In numerous meetings with
the class at St. Paul’s United Methodist Church, the attorney for
the class reported the results of the expert's calculations. The
handful of class members who claim to be unaware of such
reports apparently were either absent or were not listening. The
Court cannot find any credible evidence to support a contention
that the expert’s conclusions were hidden from the class. Even if
they had been hidden, however, that would not be a ground for
disapproving a settlement which is otherwise fair, adequate, and
reasonable. There is no obligation on the part of the class
representatives and the attorney for the class to divulge the work
product of an expert to a large and diverse class prior to
negotiating a settlement. The plaintiffs have a strong interest in
preserving the confidentiality of expert reports during
negotiations with the defendant. No valid purpose would be
served by requiring an attorney for the class to divulge his efforts
at trial preparation to a class of laymen prior to the time that a
definite settlement is reached between the parties. Moreover, any
prejudice to any of the objectors raising this contention has been
cured by the dissemination of the expert findings to the attorney
for the objectors prior to the May 12, 1983 hearing. Nothing
within the expert calculations supports a finding that any term of
the settlement ts unfair, inadequate or unreasonable.

Secondly, several class members have complained about the
individual shares of the recovery scheduled for distribution to the
members of the Committee For Equal Job Opportunity. While
the Court considered such objections in the findings and
conclusions entered in support of preliminary approval of the
proposed Consent Decree, the Court has considered the matter
again in light of the evidence developed at the hearing on
objections. After doing so, the Court has independently
determined that the findings and conclusions entered on March

A-25

23, 1983 as a part of the preliminary approval of settlement are
correct and fully supported by the weight of the evidence. Only
six class members out of over 2400 have complained about the
relatively larger individual shares accorded to the leaders of the
class who have served on the Committee For Equal Job
Opportunity. For the reasons expressed in the findings and
conclusions entered by the Court on March 23, 1983, the Court
finds that the scheduled distribution to the members of the
Committee For Equal Job Opportunity is fair, adequate and
reasonable.

Il. POST-HEARING MOTIONS AN BJECTIONS
BY CLASS MEMBERS

After the hearing on the fairness of the propx settlement
two groups of objecting class members filed ions for
rehearing under Federal Rule of Civil Procedure 59. In these
motions a number of contentions were raised which were not
presented prior to or during the fairness hearing on May 12, 1983.
At this late stage of the case, the Court can find no justifiabie
reason for allowing class members to raise matters which should
have been presented prior to the fairness hearing and the April
22, 1983 deadline for objections. Under even the most liberal
reading of Rule 59, the movants have failed to demonstrate any
evidence which is newly discovered or could not have been
presented at the May 12, 1983 hearing. Indeed, the movants have
failed to even articulate what additional evidence they would
present at any rehearing. The Court gave the objecting class
members a full opportunity to present any evidence which they
considered relevant to the issue of whether the proposed
settlement should be approved. Although the attorneys for the
objectors were asked by the Court to minimize cumulative
testimony and evidence, they were not prohibited from
presenting any witness that they called to testify. After the last
witness was presented, the Court heard no objection to taking the
case under submission. There was no request by any class
member or attorney to present further testimony or to continue
the hearing until another day. Under these circumstances, the
motions for rehearing are due to be denied. Before doing so,
however, the Court is compelled to address several of the

A-26

contentions set forth in the post-hearing motions so that the
record is not cluttered with unfounded allegations of
impropriety.

The post-hearing motion filed by Ralph Coleman on behalf of
the thirteen class members he represents raises a number of
procedural questions about the fairness of the settlement
approval process which has been followed. First, the contention
is made that the notice to the class was insufficient because it
informed class members that they would have to support any
objections to the proposed settlement with evidence which was
subject to cross-examination. At the fairness hearing there were
no class members who came forward to say that they would have
objected to the proposed settlement in the absence of that
provision in the notice to the class. Certainly none of Mr.
Coleman's clients could have so testified since all of them filed
objections. Mr. Coleman has not informed the Court of any
identifiable class members who refused to object because of a fear
of cross-examination. While the Court is sensitive to any claim
that the official notice to the class “chilled” dissent, such a claim
must at least be raised by a person who has standing to raise it and
be supported by a threshold level of credible proof of the chilling
effect. The pending motion filed by Mr. Coleman fails on both
counts. It was not filed on behalf of any person who was actually
discouraged from objecting by the formal notice and it is not
supported by any credible evidence that such a person exists.

Similar to this contention is the allegation that class members
were given exaggerated opinions of the monetary value of the
proposed settlement in meetings with the class in January of this
year. The Court finds that this contention was unsupported by
any credible evidence at the fairness hearing. No additional
evidence on this subject has been identified to the Court since that
hearing. Even if the point were fully supported by the evidence,
however, it would not call the fairness of the settlement into
question because any exaggerated descriptions of the proposed
settlement were cured by the formal notice mailed to the homes of
every class member in April. That notice contained an accurate
and complete description of the proposed settlement prior to the
deadline for objections. There has been no evidence offered of

A-27

any class member who misunderstood the terms of the settlement
after the formal notice was mailed to their home in early April of
this year.

Secondly, the post-hearing motion filed on behalf of the class
members represented by Mr. Coleman contends that the fairness
hearing was itself unfair because it placed the burden of proof on
the objecting class members and because the evidence offered by
the proponents of the settlement was in affidavit form. The
motion is incorrect in both of these contentions. At every stage of
the settlement approval process the Court has imposed the
burden on the proponents of the settlement to prove that it is fair,
adequate and reasonable. The evidence from the proponents was
received by affidavit as the direct testimony of the witnesses, but
not as their entire testimony. Each of such witnesses was either
present or on call for the purpose of cross-examination. The
opponents of the proposed settlement were given as much time to
study the affidavits as they requested. The fairness hearing was
specifically adjourned for several hours for this purpose. When
the hearing reconvened there were no objections made to the use
of such affidavits for the purpose of direct examination by any
party, class member or attorney. Neither was there any effort at
cross-examination of such witnesses. The opponents of the
settlement were represented by licensed attorneys and did not
appear pro se. The Court cannot attribute the failure to object to
the receipt of the affidavits of the proponents’ witnesses to
anything other than a knowing decision by such attorneys to
allow such affidavits to be received as evidence without need of
cross-examination of the affiants. It is now entirely too late for
the opponents to complain about the use of affidavits. The expert
witnesses retained by the parties are from North Carolina and
Texas. The opponents’ failure to attempt cross-examination at
the fairness hearing or at a deposition prior to or since such
hearing can only be cured at great expense in time and money at
this late date. The opponents of the settlement represented by
Mr. Coleman have failed to show any justification for reopening
the record to do that which should have been done at the original
fairness hearing.

The motion for rehearing filed by Ronald Spratt on behalf of

A-28

the class members he represents contends that the Court “limited
testimony by the objectors” at the May 12, 1983 hearing. The
motion fails to identify any witnesses who were present at the
hearing who were not allowed to testify. It also does not describe
what additional evidence might be offered so that the Court can
evaluate whether it would be admissible or helpful on the issues at
hand. Most, if not all, of the testimony presented by the objectors
at the May 12, 1983 hearing did not focus on the issues relevant to
a determination of whether the settlement should be approved.
The Court pointed this out to the attorneys for the objectors
several times during the hearing, but they continued to put on
evidence which had only a marginal relevance. The Court is
unwilling to exercise its discretion to reopen the evidentiary
record without a specific identification of the evidence that would
be offered at such a rehearing.

In addition, the opponents of the settlement failed to object to
the Court taking the case under submission on May 12, 1983.
After the last witness was called by the opponents there was no
request for further opportunity to present evidence or to make
arguments. At some stage the proceedings in this case must come
to anend and not be subject to repeated efforts to delay the entry
of a final judgment that will allow the class to receive the back-
pay to which they were held entitled almost ten years ago. The
Court is firmly convinced that all of the parties and class
members have been given an ample opportunity to present the
evidence that is available on the question of the fairness of the
proposed settlement. Accordingly, the motions for rehearing
filed by the opponents are denied. A separate Order will be
entered on such motions.

IV. THE RIGHT TO OPT-OUT

One final contention which was raised during the fairness
hearing remains to be considered. The testimony presented by the
opponents attempted to fault the class representatives and
attorney for informing them that they could seek to opt-out of the
settlement and attempt to prove entitlement to a larger back-pay
award. The contention is made that this constituted a “threat”
which “improperly restrained” class members from objecting.

A-29

This contention reflects a misunderstanding of the law of the case
and the duty of the attorney for the class.

In Pettway /V the Court of Appeals considered the question of
opting out at some length. It concluded witha statement that “on
remand if another settlement is reached, the district court should
provide those claimants who decide to opt-out of the settlement
with an opportunity to assert their individual claims in this
action.” /d. 576 F.2d at 1220. The attorney for the class brought
this provision of the prior mandates to the attention of the class in
his meetings with them in January, February, Marchand April of
this year. It is undisputed that he informed class members in all of
these meetings that he would assist them in seeking to opt-out of
the settlement if they desired the opportunity to present their
individual claims for greater back-pay. After formal notice to the
class was mailed to each class member, the plaintiffs’ attorney
met individually with scores of class members in his office prior
to the May 12, 1983 fairness hearing. In these meetings the
Opportunity to opt-out was once again explained to the class
members, including many of the ones now objecting to the
proposed settlement. Presumably the attorneys for the objectors
also read the mandate in Pettway /V and informed their clients of
the opportunity to opt-out of the settkement and proceed
individually with a claim for a greater back-pay award.

Despite the repeated notice to the class of the opportunity to
opt-out of the settlement there has not been a single request to do
so by any member of the class. Instead, the objecting class
members have apparently decided that the opportunity to opt-
Out is something that is not in their best interests. According to
the papers before the Court and the testimony, this decision was
made with the advice and counsel of the objectors’ attorneys.

The Court and the class representatives, of course, cannot
force the objecting class members to seek the opportunity to opt-
out of the settlement and pursue their individual claim of
entitlement to more back-pay. The decision in Pettway /V only
mentions the “opportunity” to opt-out of the settlement. In the
circumstances now before the Court that opportunity has been
provided and no class member has expressed any interest init. In

A-30

the absence of any request to opt-out and any objection based on
this ground, the Court concludes that the issue is moot.

V. AT®*RNEY AND EXPERT FEES

The Notice to the class fully described the amount of fees and
expenses which are scheduled to be paid to the attorney and the
expert for the class. Only two objections have mentioned the
reasonableness of the attorney's fees and none have mentioned
the reasonableness of the expert witness fees or the attorney's
expenses. The two objections which mentioned the attorney's
fees stated that they were contingent upon a showing of
reasonableness. At the fairness hearing on May 12, 1983 the
Court received evidence from the plaintiffs concerning the
reasonableness of the fees provided in the proposed settlement.
The opponents of the settlement declined to present any evidence
on the issue. Even in their arguments to the Court at the hearing,
the objecting class members and their attorneys did not oppose
the attorney's fees provided in the proposed settlement. The two
class members who mentioned the attorney’s fees in their written
objections prior to the hearing did not express such objections or
offer anything in support of them at the hearing.

Nevertheless, the Court is aware of its own independent
obligation to consider the reasonableness of the attorney's fees
and expert witness tees provided in the proposed settlement. The
Court has received testimony from the plaintiffs’ attorney and
two additional attorneys who are well respected for their
knowledge and expertise in litigation in this District. This
testimony was received as evidence in the form of affidavits
without objection from any party or class member. The
opponents of the settlement declined the opportunity to cross-
examine such witnesses.

The Court examined the reasonableness of attorney's fees
prior to giving preliminary approval to the proposed settlement.
See Findings Of Fact And Conclusions Of Law Giving
Preliminary Approval To Proposed Consent Decree, pp. 17-23
(entered March 23, 1983). The Court now has before it additiona!
evidence on the subject. Based on all of the evidence and the
Court's own independent knowledge of the efforts of the attorney

A-31

for the class, the Court finds that each of the twelve factors set
forth in Johnson v. Georgia Highway Express, Inc., 488 F.2d 714
(Sth Cir. 1974), support a finding that the attorney's fees
requested by the plaintiff's attorney are reasonable. More
specifically, as to each of the twelve Johnson, supra, factors, the
Court finds:

1. Novelty and Difficulty: This case has involved a series of
novel and difficult legal and factual issues throughout the eight
years that the plaintiffs’ attorney has devoted to prosecution of
the back-pay claims of the class. Many of the issues that have
been resolved in this case have been ones of first impression and
have resulted in a suibstantial body of precedent for guidance of
future cases.

2. Skill Requisite To Perform The Legal Services Properly.
The proper representation of the class in this case has required a
high degree of skill and effort at both the trial and appellate
levels.

3. Experience, Reputation And Ability Of The Plaintiffs’
Attorney: While the plaintiffs’ attorney had very little experience
or reputation at the beginning of his representation of the
plaintiffs, he has gradually gained a great deal of experience and
ability in this area of the law since 1975. The great majority of the
work for which he is currently being compensated involves the
1980-1983 period of time. During that period the plaintiffs’
attorney has been one of the most experienced and able
practitioners on the plaintiffs’ side of Title VII cases in this
District. The Court of Appeals in Johnson, supra at 719,
recognized that “(a)n attorney specializing in civil rights cases
may enjoy a higher rate for his expertise than others, providing
his ability corresponds with his experience.” The ability
displayed in this case has been commendable

4. Amount Involved and Results Obtained: The amount
involved in the case is substantial for this area of the law and this
District. The results obtained are in cvery sense impressive and
accord important remedies to a large class of black employees

5. The Customary Fee: The lead attorneys for the defendant
have charged between $90 and $100 per hour for the work they

A-32

have done on a non-contingent basis for the defendant in the last
three years in this case. The evidence before the Court indicates
that such rates are customary in this Distict for non-contingent
work of the type involved in this case since 1980.

6. The Contingency, Of The Fee: The plaintiffs’ attorney has
prosecuted this case on the basis of a fee that was contingent on
success and court approval. Since the remand in Petiway /?,
supra, and the entry of the injunctive Consent Decree in 1980, the
Company has taken the position that an award of further
attorney's fees was contingent upon continued success on the
remaining claims in the case. Throughout his representation of
the class since 1975 the plaintiffs’ attorney has been exposed to
the substantial risk of receiving nothing for his time and services.

7. Preclusion Of Other Employment: The number of hours
and the priority which has had to be given to this case because of
its age has foreclosed more than half of the time available for
work on the affairs of other clients during the last three years.
Because of this fact, the plaintiffs’ attorney has had to turndown
and transfer a substantial amount of other business which could
have provided him a more secure and predictable income.

8. Time Limitations Imposed By The Client And The
Circumstances: The plaintiffs’ attorney has had to work under
very tight time constraints at numerous points of the last three
years. While the case has appeared to drag very slowly at times,
that has only been because of the immense amount of work that
has gone into the case. Beginning in July, 1980 this Court and the
Court of Appeals have expedited the processing of the case and
placed short deadlines on virtually every aspect of the case. The
decision in Johnson, supra at 718, states that “(p)riority work
that delays the lawyer's other legal work ts entitled to some
premium. This factor is particularly important when a new
counsel is called into prosecute the appeal or handle other
matters at a late stage in the proceedings.” /d. That factor is fully
applicable to the work at bar.

9 Nature And Length Of Professional Relationship With
Client. The class in this case is large and, at times, very vocal as to
how it desires this case to be handled. The nature and length of

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the relationship between the attorney for the class and the class
itself has necessarily presented difficulties and aggravations
which are not associated with providing more routine or
traditional legal services.

10. Time And Labor Required: The plaintiffs’ attorney
expended 3,508 hours in the prosecution of the monetary claims
of the class priorto January 10, 1983. The contemporaneous time
records kept by him were made available during the fairness
hearing on May 12, 1983. Neither the attorneys nor any class
members who attended that hearing expressed any doubt as to
the reasonableness of any of the hours recorded in such time
records. There has been no duplication of work on behalf of the
plaintiffs. The plaintiffs’ attorney, Robert L. Wiggins, Jr., has
been the only attorney who has worked on this case for the
plaintiff class since 1975. All of the 3,508 hours for which he is
being compensated were expended on the monetary claims of the
class and not on any claims on which the plaintiffs were
ultimately unsuccessful. The Court has carefully considered the
recorded hours and has not been able to identify any which were
unreasonably or unproductively expended. See generally,
Fitzpatrick v. Internal Revenue Service, 665 F.2d 327 (11th Cir.
1982). The Court finds that all of these hours were reasonably
spent in the prosecution of the plaintiffs’ back-pay claims.
Among other facts which support this finding, the Court notes
that the defendant's attorneys spent a comparable number of
hours on this case during the same period of time.

11. Undesirability Of The Case: Based on all of the
circumstances surrounding this case since June, 1975, the Court
finds that it was a highly undesirable undertaking which very few
attorneys would have accepted. The acceptance of this case had a
negative effect on the practice of the plaintiffs’ attorney. The
delay of eight years in receipt of payment for his services has also
contributed to its undesirable character.

12. Award In Similar Cases: There are very few cases similar
to the one now before the Court. In one recent individual Title
VII action which lasted less than two years, another judge of this
District awarded the current plaintiffs’ attorney $90 per hour and

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then doubled the fee because of the applicability of several of the
Johnson, supra, factors. Davis v. Construction Materials, Inc.,
CV# 81-C-1816-S (N.D. Ala. 1982). In two other cases in this
District the court has awarded $85.00 per hour and 10% of the
total recovery of the class to the plaintiff's attorney. Harper vy.
Federal Deposit Insurance Corp., CV# 79-HM-0921-S; South vy.
C. J. Hughes, CV# 80-HM-0397-S. See also, Neely v. City of
Grenada, 624 F.2d 547, 551 (Sth Cir. 1980). The Court finds that
the fee involved in the proposed settlement is less than what
might have been awarded in comparable cases that did not
involve a settlement. It is also less than what the defendant has
paid its own attorneys in this case.

The Court concludes that this is a case in which the plaintiffs’
attorney is entitled to some premium or enhancement of the fee
that he normally would be entitled to receive in less exceptional
circumstances. While the Court believes that all of the twelve
Johnson, supra, factors support some degree of enhancement,
the Court is particularly impressed with the amount involved and
the results obtained for the plaintiff class. See e.g., Neely v. City
of Grenada, supra at 551. As the Supreme Court has recently
recognized, “in some cases of exceptional success an enhanced
award may be justified.” Hensley v. Eckerhart, Slip Op. (May 16,
1983). The history of this lawsuit certainly marks it as one
involving “exceptional success.”

Based on a'l of the foregoing factors, the Court finds that the
attorney's fee and expenses set forth in the proposed Consent
Decree are reasonable for the period through January 10, 1983.
In reaching this finding the Court has reviewed the findings of
fact and conclusions of law entered in support of preliminary
approval of the attorney's fees on March 23, 1983. Those findings
and conclusions are fully supported by the evidence presented at
the May 12, 1983 hearing. The Court adopts and reaffirms such
findings and conclusions in support of the attorney's fee award.

In addition, the amount of fees set forth in the proposed
Consent Decree did not include any compensation for the period
since January 10, 1983. The plaintiffs’ attorney has expended 392
hours in representing the class in gaining approval of the

A-35

proposed settlement and in otherwise fulfilling his obligations to
the class on the monetary relief aspects of this case. The Court
finds that these hours were both necessary and reasonable and
that the attorney for the class should be compensated for them in
the amount of $100 per hour. Such fees will be paid in accordance
with the provisions of 47 and 9 12 of the proposed Consent
Decree. The plaintiffs’ attorney is entitled to be compensated for
all hours reasonably expended by him between June 22, 1983 and
the date that the back-pay is distributed to the members of the
class. Plaintiffs’ attorney shall, prior to the distribution of the
monetary sums set forth in the Consent Decree, provide the
Court witha summary of the hours expended since June 22, 1983.
Such payment shall also be at the rate of $100 per hour and shall
be paid from the funds provided in § 12 of the proposed
settlement.
CONCLUSION

The Court has carefully considered the terms of the proposed
settlement in light of all the evidence, arguments, and previous
decisions which have been entered in this action. The Court finds
that the parties have carried their burden of proving that all of the
terms and provisions of the settlement are within the range of
what could have reasonably been expected to have been recoverd
at trial. The Court also finds that the class representatives and the
attorney for the class have provided adequate representation of
the interests of every member of the class and that the settlement
is a fair, adequate and reasonable disposition of the claims of
each segment of the class.

DONE this 23rd day of June, 1983.

Sevbourn H. Lynne
United States District Judge

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PETTWAY v. AMERICAN CAST IRON PIPE CO.

Rush PETTWAY, et al.,
Plaintiffs- Appellees,

Charles L. Daniel, et al.,
Plaintiffs-Appellants,

and

United States Equal Employment
Opportunity Commission,
Plaintiff-Intervenor-Appellee,

v.

AMERICAN CAST IRON PIPE COMPANY
Defendant-Appellee.

No. 83-7425
Non-Argument Calendar.

United States Court of Appeals,
Eleventh Circuit.

Nov. 21, 1983.

Black employees brought class action alleging employment
discrimination. The District Court, 332 F.Supp. 811, found
racial discrimination, but declined to find any damages, and the
Court of Appeals, 494 F.2d 211, remanded for determination of
back pay, and thereafter denied rehearing, 494 F.2d 1296.
Following remand, the District Court approved proposed
settlement and overruled motions by dissatisfied class members,
and the Court of Appeals, 576 F.2d 1157, affirmed in part,
reversed in part, and remanded. The Court of Appeals, 581 F.2d.
267, denied rehearing en banc, and the Supreme Court, 439 U.S.
1115, 99 S.Ct. 1020, 59 L.Ed.2d 74, denied certiorari. On remand,
the District Court ordered special master to proceed with
determination of back pay on individual-by-individual basis, but
the Court of Appeals, 681 F.2d 1259, vacated and remanded,
encouraging further effort at settlement. The United States
District Court for the Northern District of Alabama, Seybourn
H. Lynne, J., approved settlement agreement, and 58 dissatisfied
class members appealed. The Court of Appeals held that

A-37

evidence supported finding that 58 dissatisfied members of class
were treated fairly and received amounts to which they were
entitled in settlement of back pay claim.

Affirmed.

Federal Civil Procedure 1699

In class action alleging racial discrimination in employment,
evidence supported finding that 58 dissatisfied members of class
were treated fairly and received amounts to which they were
entitled in settlement of back pay claim.

Appeals from the United States District Court for the
Northern District of Alabama.

Before RONEY and CLARK, Circuit Judges, and TUTTLE,
Senior Circuit Judge.

PER CURIAM:

This is the sixth appearance of this case before this Court and
its predecessor, the Court of Appeals for the Fifth Circuit. The
belabored history of the litigation is fully stated in its last
previous appearance here, Pettway, et al. v. American Cast Iron
Pipe Co., 681 F.2d 1259 (11th Cir. 1983). Very briefly stated, the
history encompassed the following steps. Originally the trial
court found the existence of racial discrimination in the
employment and promotion practices of the defendant. The
court granted an injunction and then declined to find any
damages in favor of the plaintiff class. Upon appeal, this Court
remanded for a determination of back pay, 494 F.2d 211, leaving
open, of course, the possibility of a settlement between the
parties. Such a proposed settlement was recommended by the
class representatives and their counsel, in a sum amounting to
approximately $1,000,000. Because of the objection of some
seventy percent of the members of the class, and other defects
found by this Court to have occurred in the trial court's approval
of such settlement, this Court again reversed and remanded the
case for further proceedings. A substantial number of the
members of the class had accepted checks mailed out by the

A-38

defendant in accordance with the proposed settlement. Because
the trial court announced its intention of requiring proof by every
member of the class of his own amount of back pay to which he
considered himself entitled, this Court again reversed and
directed that the court determine whether it could not estimate a
back pay award due to the class as a whole. Again, this Court at
681 F.2d 1259, encouraged a further effort at settlement.
Settlement efforts finally succeeded and after due hearing upon
the recommendation of the class counsel, more than 95 percent of
the members of the class, with the concurrence of the Equal
Employment Opportunity Commission, approved the
settlement. Now, 58 members of the class, filed these appeals.

The principal argument presented by the present appellants is
that they did not receive amounts in the proposed distribution
equal to comparable members of the class. In effect, they contend
they should not be required to include as part of their final award,
the amount of the checks they cashed in 1975. With evidence at
the fairness hearing of the current value of the 1975 payments to
these employees, the court could properly conclude that the
parties were treated fairly.

We have carefully considered the record of the fairness hearing
conducted by the trial court, and the court's full discussion of
each issue raised at the hearing. As stated by the court at the
conclusion of the hearing, the court had been aware of the many
issues in the case fora period of 17 years, and it showed itself to be
completely aware of the relatively small number of objectors who
made competing claims as to the amounts they should have
received in the final settlement.

We find that the trial court had before it more than sufficient
evidence upon which it could, as it did, conclude that the
settlement was “fair and reasonable.”

We particularly note that, once all of the legal complications in
the case had finally been disposed of, during the many trips of this
case to the courts of appeals of this and the Fifth Circuit, the trial
court demonstrated unusual skill in apprehending each nuance
that was even suggested by the present objectors, the appellants
here. We conclude that the final determination of the trial court,

A-39

bolstered to some extent by the agreement, though without the
signature, of the Equal Employment Opportunity Commission,
cannot be faulted as having been an abuse of the trial court's
discretion.

All pending motions, not individually acted on, are hereby
denied.

The judgment is AFFIRMED.

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IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT

No. 83-7425

Rush PETTWAY, et al.,
Plaintiffs- Appellees,

Charles L. Daniel, et al.,
Plaintiffs- Appellants,

and

United States Equal Employment
Opportunity Commission,
Plaintiff-Intervenor-Appellee,

v.

AMERICAN CAST IRON PIPE COMPANY,
Defendant-Appellec.

Appeal from the United States District Court for the Northern
District of Alabama

ON PETITION FOR REHEARING AND SUGGESTION
FOR REHEARING EN BANC
(Opinion November 21, 1983, I! Cir., 198 , F.2d).

Betore RONEY and CLARK, Circuit Judges, and TUTTLE,
Senior Circuit Judge

PER CURIAM:

The Petition for Rehearing is DENIED and no member of this
panel nor other Judge in regular active service on the court
having requested that the Court be polled on rehearing en blanc
(Rule 35, Federal Rules of Appellate Procedure; Eleventh Circuit
Rule 26), the Suggestion for Rehearing En Banc is DENIED.

The Petition for Rehearing is DENIED and the Court having
been polled at the request of one of the members of the Court and
a majority of the Circuit Judges who are in regular active service
not having voted in favor of it (Rule 35, Federal Rules of
Appellate Procedure; Eleventh Circuit Rule 26), the Suggestion
for Rehearing En Banc is also DENIED.

A-4]

A member of the Court in active service having requested a poll
on the reconsideration of this cause en banc, and a majority of the
judges in active service not having voted in favor of it, rehearing
en banc is DENIED.

ENTERED FOR THE COURT:

Paul H. Roney
United States Circuit Judge

A-42

IN THE UNITED STATES DISTRICT COURT FOR THE
NORTHERN DISTRICT OF ALABAMA
SOUTHERN DIVISION

CIVIL ACTION NO. 66-315

RUSH PETTWAY, et al.,
Plaintiffs,

v.

AMERICAN CAST IRON PIPE COMPANY
Defendant.

SUPPLEMENTAL AFFIDAVIT OF
ROBERT L. WIGGINS, JR.

STATE OF ALABAMA )
JEFFERSON COUNTY )

Comes Robert L. Wiggins, Jr. who, first being duly sworn
proposes and states as follows:

1. Since January 10, 1983 I have expended 392 hours in
representing the class in obtaining the monetary relief provided
for in the Consent Decree and in securing the agreement of the
class with such settlement. The hours spent by me on the
monetary remedies obtained in this case since January 10, 1983
were maintained on contemporaneous time records, The time
which was recorded on the contemporancous time records since
January 10, 1983 is summarized on the attached itemization of
time. The attached itemization is an accurate summary of the
time spent by me since January 10, 1983 on the monetary relief
obtained for the class

Robert L. Wiggins, Jr.
Attorney for Plaintiffs

Suite 716 Brown Marx Building
Birmingham, Alabama 35203

April 19,

April 22,

April 26,

April 27,

April 28,

April 29,
April 30,

, 1983

, 1983

1983

1983

1983

1983

1983

1983
1983

A-43

Prepare and attend meeting with
CEJO and class at St. Paul's

Meet with class members; draft letter
to Supreme Court on extension of
Petition For Cert

Meet with class members on settlement
all day; draft letters to class members
calling on telephone

Meet with class members; review status
of objections at Courthouse; talk to
Logan on telephone; meet with Bates
on objections

Review objections and draft joint
motion to require disclosure of facts by
objectors; draft letter to Logan
summarizing objections by categor-
ies—5 page letter

Meet with class members all morning
on settlement, prepare and meet with
Pat Logan on approach to objections;
meet with class members; draft ob-
jection to Petition to change LOP’s

Meet with class members all morning;
meet with class members all afternoon,
meet with Booker, Henley and
Blackmon on objections

Meet with class members all morning

Meet with class members all day

5.8

8.0

98

4.8

10.9

10.6
4.0
7.8

A-44

Respectfully submitted,

Lara $

Ralph E. Coleman

2175 tith Court South
Birmingham, Alabama 35205
(205) 939 0444

Counsel of Record for Petitioners,
Charles L. Daniel, et al

Ronald L. Spratt

1929 North Third Avenue North
Smith Towers, Suite 3200
Birmingham, Alabama 35203
(205) 251-7180

trrorney for Petitioners,
Charles L. Daniel, et al

OF COUNSEI

COLEMAN & COLEMAN
2175 tith Court South
Birmingham, Alabama 35205
(205) 939-0444

---

Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385011_1609%3A2. Public record. Not legal advice.