Amicus Curiae Brief — Zant v. Corn

@ (is) CY 7 Supreme Court, US.

Nos. 87-1614, 87-1639, 87-1668 FILE D

SEP 15 1988

JOSEPH F. SPANIOL, JR.

Supreme Court of the United States — c.cr«

October Term, 1988

+

—

JOHN W. MARTIN, et al.,

v. Petitioners,

ROBERT K. WILKS, et al.,

Respondents.

THE PERSONNEL BOARD OF JEFFERSON

COUNTY, ALABAMA, et al.,

V. Petitioners,

ROBERT K. WILKS, et al.,

Respondents.

RICHARD ARRINGTON, JR., et al.,

v. Petitioners,

ROBERT K. WILKS, et al.,

Respondents.

On Writ of Certiorari to the United States

Court of Appeals for the Eleventh Circuit

BRIEF AMICUS CURIAE OF PACIFIC LEGAL

FOUNDATION IN SUPPORT OF RESPONDENTS

Of Counsel RoNALD A. ZUMBRUN

* ANTHONY T. Caso

Desorau L. GaRLIN *Counset Or Recorp

Pacific LEGAL FOUNDATION Paciric LEGAL FOUNDATION

555 Capitol Mall, Suite 350 555 Capitol Mall, Suite 350

Sacramento, CA 95814 Sacramento, CA 95814

Telephone: (916) 444-0154 Telephone: (916) 444-0154

Attorneys for Amicus Curiae,

Pacific Legal Foundation

COCKLE LAW BRIEF PRINTING CO. (800) 225-6964

OR CALL CON. BCT (402) 342-2831

77

i

TABLE OF CONTENTS

SN Wea Be OPINION BELOW

“ STATEMENT OF THE CASE

FKL. Sete Meee hep | 4 I. THIS CASE IS NOT AN IMPERMISSIBLE COL-

1 chi ee cures ; LATERAL ATTACK ON THE CONSENT

ae Ee | ‘a permissible Collateral Attack Doc-

een Oe hela Bet | m trine Is an Unwarranted Exception to Well-

ae ® Gd, | | 4 Settled Principles of Res Judicata and Col-

anes Aoay Ene Sa . Due Process Limits the Preclusive Effect of

, ie LS Res Judicata in a Consent Decree Because It

Is Not an Adjudication on the Merits

. THE RULE OF ATORY INTERVENTION

WHICH RS ASK THE COURT TO

ADOPT IS INVALID UNDER DUE PROCESS

. TITLE VII’'S POLICY FAVORING VOLUNTARY

SETTLEMENT OF EMPLOYMENT DISCRIMI-

NATION DISPUTES DOES NOT JUSTIFY

UNLAWFUL DISCRIMINATION AGAINST

EXISTING EMPLOYEES...............+000005:

CONCLUSION

19

ii

TABLE OF AUTHORITIES CITED

Page

Cases

Alexander v. Gardner-Denver Co., 415 U.S. 36

CIDP] ... .ccccccccccsccccsueneeenunennnnnnE 19, 20

Ashley v. City of Jackson, 464 U.S. 900

CIGGED oo cccccccccccccnscauuene enema 7, 8, 11, 12, 22

Corley v. Jackson Police Department, 755 F.2d

1207 (Sth Cir. 1905)... .ccccccccccccccssccsssecessss 8

County of Orange v. Air California, 799 F.2d 535

(Sth Cie, 1906)... cccceccciccseccsencsnsununeseneeene 8

Dunn v. Carey, 808 F.2d 555 (7th Cir. 1986) .......... 8

Firefighters Local Union No. 1784 v. Stotts,

467 US. 561 (19GG 2. ccccccccccccsccscncscess 8, 9, 20

Local Number 93 v. City of Cleveland, 478 U.S.

501, 92 L. Ed. 2d 405 (1986) .......... 8, 9, 10,12, 13

Logan v. Zimmerman Brush Co., 455 U.S. 422

BOG) . oc ccccccccccececcescsseceuaussnneennnn—En 18

McDonald v. Santa Fe Trail, 427 U.S. 273 (1976)..... 19

Mullane v. Central Hanover Bank and Trust Com-

pany, 339 U.S. 306 (1950)... 0.6... cece eee eens 14, 18

Parklane Co., Inc. v. Shore, 439 U.S. 322 (1979)...... 11

Sea-Land Services, Inc. v. Gaudet, 414 U.S. 573

(1974) Prcrr tesa este eeeeeeeeeneeeereneeeeesneaeeees 8

iii

TABLE OF AUTHORITIES CITED-Continued

Page

United States v. Jefferson County, 720 F.2d 1511

PE SMEUS SSS GS Sasccccecconcscesces 17, 23

W. R. Grace and Co. v. Rubber Workers, 461 U.S.

ENE ee ee es ascccccccccccccccccce 11

Wygant v. Jackson Board of Education, 476 U‘S.

UUEEERMERG aS esescceccccsecccccccccccce 11

Statutes

EPCS Chess eencescccccsccccccccccs 16

ES Cacasccccssccccscccscccccsccsces 10

CCC Cee ou ss seseccsscecccccesccccce 20

§ 2000e-S(F)(1) .. 2... eee eee cece eee eee eee 16, 20

RULEs

Federal Rules of Civil Procedure, Rule 19....... | 18, 21

CEP EECE RES Gsccceccccccecccccccces: passim

ea S ase scscscescescccccsccsees 2

MISCELLANEOUS

Kramer, L., Consent Decrees and the Rights of

Third Parties, 87 Mich. L. Rev. (1988)......... 15, 16

Restatement (Second) of Judgments § 28 (1980)....... 8

Nos. 87-1614, 87-1639, 87-1668

In The

Supreme Court of the United States

October Term, 1988

+

JOHN W. MARTIN, et al.,

v. Petitioners,

ROBERT K. WILKS, et al.,

Respondents.

THE PERSONNEL BOARD OF JEFFERSON

COUNTY, ALABAMA, et al.,

v. Petitioners,

ROBERT K. WILKS, et al.,

Respondents.

RICHARD ARRINGTON, JR., et al.,

V. Petitioners,

ROBERT K. WILKS, et al.,

Respondents.

On Writ of Certiorari to the United States

Court of Appeals for the Eleventh Circuit

BRIEF AMICUS CURIAE OF PACIFIC LEGAL

FOUNDATION IN SUPPORT OF RESPONDENTS

2

INTEREST OF AMICUS

Pursuant to Supreme Court Rule 36, Pacific Legal

Foundation respecfully submits this brief amicus curiae

in support of respondents. Consent to the filing of the

brief has been granted by counsel for all parties. Copies

of the letters of consent have been lodged with the clerk

of this Court.

Pacific Legal Foundation is a nonprofit, tax-exempt

corporation, incorporated under the laws of California

for the purpose of participating in litigation affecting

public policy. Policy of the Foundation is set by a Board

of Trustees composed of concerned citizens, the majority

of whom are attorneys. The Board of Trustees evaluates

the merits of any contemplated legal action and autho-

rizes such legal action only where the Foundation’s posi-

tion has broad support within the general community.

The Foundation’s Board of Trustees has authorized the

filing of a brief amicus curiae in this matter.

Pacific Legal Foundation has participated in other

cases which involved employment discrimination issues

and supports the rights of all employees to challenge

race-conscious employment programs regardless of

whether they were established by consent decree or were

self-imposed. The Foundation’s public policy perspective

and litigation experience in support of individual liber-

ties will help provide this Court with additional argu-

ment in which to view the holding of the Eleventh Circuit

Court of Appeals in this matter.

a

OPINION BELOW

The opinion of the United States Court of Appeals for

the Eleventh Circuit is reported at 833 F.2d 1492 (11th Cir.

1987).

——--@——

STATEMENT OF THE CASE

This case presents the question whether nonminority

employees who were neither parties to nor intervenors in

an ongoing Title VII action are precluded from challeng-

ing race-conscious promotions instituted pursuant to a

consent decree. Furthermore, this case raises an issue as

to the validity of the impermissible collateral attack doc-

trine which bars independent third party claims under a

theory of mandatory intervention.

This litigation originated in a Title VII employment

discrimination action against the City of Birmingham

(City) and Jefferson County Personnel Board (Personnel

Board). The parties negotiated a settlement which

resulted in two proposed consent decrees and thus the

plaintiffs’ claims against the City were never adjudicated.

The consent decrees provided for race-conscious hiring

and promotion plans as part of an extensive remedial

scheme. Each decree specifically stated that it was not an

adjudication or admission of liability by the defendants.

After the District Court entered a provisional order

approving the decrees, a fairness hearing was held to

consider the objections of interested parties. The fire

fighters union filed objections as amicus curiae at that

hearing. After the hearing, but prior to final entry of the

consent decree, the union and two individual members

moved to intervene pursuant to Federal Rule of Civil

Procedure 24(a), on the grounds that the proposed con-

sent decrees would adversely affect their rights. The

motion was denied as untimely and, subsequently, on

August 18, 1981, the court entered an order approving

the decrees.

In affirming the District Court’s denial of the motion

to intervene, the Eleventh Circuit concluded that the

holding was not prejudicial to the white fire fighters

because they still had the right to an independent action

for unlawful discrimination on their own behalf.

Seven white fire fighters, who were existing

employees, brought suit in District Court against the City

and Personnel Board alleging that the race-conscious pro-

motions made pursuant to a consent decree violated their

Title VII and Fourteenth Amendment rights. Several

other City employees who had been denied promotions

subsequently brought similar suits against the City and

Personnel Board, as did the United States, who was a

signatory to the decrees.

Although the City and the Personnel Board admitted

making race-conscious certifications pursuant to the

terms of the decrees, they contended that the nonparty

employees were bound by the consent decrees and that in

any case, the challenged promotions were lawful because

they had been made pursuant to the decrees.

After several black individuals who were signatories

to the consent decree were allowed to intervene as party

defendants, the District Court consolidated the several

suits under the caption In re Birmingham Reverse Discrimi-

nation Employment Litigation.

At the conclusion of plaintiffs’ case during trial, the

District Court granted the Personnel Board’s motion to

dismiss, holding that the individual plaintiffs were bound

by the consent decrees.

On appeal, the Eleventh Circuit reversed and

remanded with instructions that the District Court try the

unlawful discrimination claims. The appeals court con-

cluded that the nonparty fire fighters were neither parties

nor privies to the consent decrees and that their claims

did not accrue until after entry of the consent decree. In

holding that the individual fire fighters were not bound

by the decrees, the court rejected the impermissible col-

lateral attack doctrine and found that the existing

employees’ individual claims of unlawfui discrimination

could not be precluded.

—>

SUMMARY OF ARGUMENT

The question presented by this case is whether non-

minority employees who were neither parties to nor

intervenors in an ongoing Title VII action are precluded

from challenging race-conscious promotions made pur-

suant to a consent decree in that action. Petitioners, the

City of Birmingham, et al., contend that the nonparty

employees are barred from “collateral attacks” on the

consent decree if they bypassed the opportunity to inter-

vene in the original proceedings. This argument is unper-

suasive for several reasons.

First, the impermissible collateral attack doctrine is

an unwarranted exception to well-settled preclusion law.

It violates due process when persons not party nor privy

to an action are bound by the judgment. Second, the

City’s interpretation of the timeliness requirement of Rule

24 of Federal Rules of Civil Procedure does not provide

nonparty employees with a constitutionally adequate

opportunity to assert their interests. The mandatory

intervention argument does not justify denying nonpar-

ties the right to assert claims that arose only after entry of

the consent decree.

Finally, policies favoring voluntary settlement of dis-

crimination claims do not give employers license to tram-

mel the rights of existing employees. Title VII and the

Equal Protection Clause protect all persons from unlawful

discrimination by a public employer.

The nonminority fire fighters’ claims did not even

accrue until they were denied promotions pursuant to

race-conscious plans established by the consent decree.

Therefore, the Eleventh Circuit was correct in holding

that the subsequent actions challenging unlawful dis-

crimination were not impermissible collateral attacks.

+

ARGUMENT

I

THIS CASE IS NOT AN IMPERMISSIBLE

COLLATERAL ATTACK ON THE CONSENT DECREE

Petitioners’ impermissible collateral attack argument

is not persuasive. They contend that the nonminority fire

fighters are barred from challenging the underlying con-

sent decrees in a subsequent suit because they bypassed

the opportunity to intervene in the original suit. See Brief

of Petitioners Richard Arrington, Jr. and City of Bir-

mingham at 20, et se,;. However, this case can be best

characterized, in the words of Justice Rehnquist, as pre-

senting “the question whether a victim of alleged dis-

crimination may have his right to sue totally

extinguished by a prior suit to which he was not a party

and in which a consent decree was entered before his

cause of action even accrued.” Ashley v. City of Jackson,

464 U.S. 900, 900 (1983) (Rehnquist, J., dissenting from

denial of certiorari).

There is no justification, therefore, in well-settled

preclusion law or policies favoring settlement of Title VII

suits for barring a subsequent suit by a nonparty

employee as an impermissible collateral attack. Id. at 903.

A. The Impermissible Collateral Attack Doctrine Is an

Unwarranted Exception to Well-Settled Principles

of Res Judicata and Collateral Estoppel

Several lower courts have developed a rule to pre-

clude subsequent suits by nonminority employees who

were neither party nor privy to the underlying Title VII

litigation. These courts have held that nonparties to a

consent decree are nonetheless bound by the decree and

therefore any separate challenge must be dismissed as an

impermissible collateral attack. The Eleventh Circuit,

however, guided by decisions of this Court, expressly

rejected the impermissible collateral attack doctrine as an

unwarranted exception to well-settled principles of pre-

clusion law. In re Birmingham Reverse Discrimination

Employment Litigation, 833 F.2d 1492, 1498 (11th Cir. 1987).

Several other circuits have also had second thoughts

about the collateral attack doctrine. Both the Seventh and

Ninth Circuits, for example, have suggested that they

would reconsider their earlier position favoring the rule.

See Dunn v. Carey, 808 F.2d 555 (7th Cir. 1986), and County

of Orange v. Air California, 799 F.2d 535 (9th Cir. 1986). In

addition, one panel of the Fifth Circuit has expressed

doubt about the continued applicability of the doctrine.

Corley v. Jackson Police Department, 755 F.2d 1207 (Sth Cir.

1985).

Plaintiffs-respondents are existing employees who

were neither parties in nor privy to the original action. In

re Birmingham, 833 F.2d at 1498. It is a well-settled princi-

ple of preclusion law that nonparties to an action are not

bound by the judgment. Sea-Land Services, Inc. v. Gaudet,

414 U.S. 573, 593 (1974). In his persuasive dissenting

opinion in Ashley Justice Rehnquist notes that this rule

can be traced to an 1816 opinion by Chief Justice Mar-

shall. Ashley v. City of Jackson, 464 U.S. at 901 (Rehnquist,

J., dissenting from denial of certiorari). Res judicata and

collateral estoppel only prevent parties to a prior suit

from attacking the judgment in a separate action. Restate-

ment (Second) of Judgments § 28 (1980).

These same principles are all the more applicable to a

consent decree. Firefighters Local Union No. 1784 v. Stotts,

467 U.S. 561 (1984) (O’Connor, J., concurring). This Court

recently emphasized that nonparties to a consent decree

are not bound by it; a consent decree cannot impose

duties or obligations on a third party without that per-

son’s consent. Local Number 93 v. City of Cleveland,

478 U.S. 501, 92 L. Ed. 2d 405, 428 (1986). Moreover, even

if a consent decree attempts to dispose of the claims of

third parties, those third parties will not be bound by the

terms of the decree unless their interests have been ade-

quately represented. Id.

Justice O’Connor noted in her separate concurring

opinion in Stotts, that innocent third-party employees

have the right to participate fully in the settlement pro-

cess if they are to have any obligations or duties imposed

upon them. If the plan affects the promotion oppor-

tunities of nonminority employees, those employees must

be represented as parties to the decree or they will not be

bound by it. Firefighters Local Union No. 1784 v. Stotts,

467 U.S. at 573 n.3 (O’Connor, J., concurring).

The District Court below found that the individual

fire fighters were neither parties nor privy to the consent

decrees. See Appendix to Petitions for a Writ of Certiorari

to the United States Court of Appeals for the Eleventh

Circuit (Petitioners’ Appendix) at 105a. The Eleventh Cir-

cyit agreed, stating that their union’s participation as an

amicus at the fairness hearing was hardly enough to

make the individual fire fighters parties to the decree. In

re Birmingham, 833 F.2d at 1499.

In addition, the Eleventh Circuit determined, consis-

tent with this Court’s decision in Cleveland, that timely

intervention by the white fire fighters still would not

have precluded a subsequent suit. Cleveland also involved

a public employer and a fire fighters’ union. In Cleveland,

however, the union actually intervened in the action. It

presented evidence and had its objections heard at the

fairness hearings, but the consent decree was, nonethe-

less, entered over the union’s objections. The Cleveland

Court found the union could not block the decree by

10

withholding its consent but the nonminority employees

who did not consent to the decree were free to challenge

the race-conscious measures established by the decree as

violative of their Title VII (42 U.S.C. § 2000e-5) and Four-

teenth Amendment rights. “A court’s approval of a con-

sent decree between some of the parties therefore cannot

dispose of the valid claims of non-consenting intervenors;

if properly raised, these claims remain and may be liti-

gated by the intervenor.” Cleveland, 92 L. Ed. 2d at 428.

This Court’s decision in Cleveland that intervenors

may challenge unlawful discrimination in a separate

action should apply with all the more force to those who

were neither parties nor privies to the action, such as the

white fire fighters in the present case. The Eleventh Cir-

cuit was correct therefore in concluding that the non-

minority employees had the right to challenge the

promotions in a separate action. In re Birmingham,

833 F.2d at 1499 n.21.

The City has not identified the precise question )re-

sented here. Whether respondents had notice and oppor-

tunity to intervene in the action is not the issue. This

definition of the issue presupposes that it is possible to

resolve the claims of all persons who may be affected by

the consent decree prior to entry of the decrees. However,

this is simply not true; the nonparty employees’ claims

could not have been resolved prior to entry of the consent

decree because those claims were based on actions taken

pursuant to the terms of the decree.

The nonminority employees’ cause of action for

unlawful discrimination arose only after entry of the

consent decrees. Their Title VII and constitutional claims

11

accrued only when they were denied promotions on the

basis of race-conscious certifications made pursuant to

the consent decrees. The nonminority fire fighters did not

consent to the terms of the decrees and therefore are not

precluded from challenging those decrees subsequently

once they became victims of alleged unlawful

discrimination.

Respondents’ individual rights cannot be bargained

away or sacrificed at the will of the employer. A race-

conscious plan “cannot justify the discriminatory effect

on some individuals because other individuals have

approved the plan.” Wygant v. Jackson Board of Education,

476 U.S. 267, 281 n.8 (1986) (plurality opinion).

The appeals court therefore properly refused to bind

the nonminority plaintiffs-respondents to the terms of the

consent decree.

B. Due Process Limits the Preclusive Effect of Res

Judicata in a Consent Decree Because It Is Not an

Adjudication on the Merits

Due process is violated when judgments bind per-

sons who were neither parties nor privies and therefore

never had an opportunity to be heard. Parklane Co., Inc. v.

Shore, 439 U.S. 322, 327 n.7 (1979). Moreover, due process

concerns are even greater in a consent decree which is not

an adjudication on the merits. Because the merits are not

fully litigated, nonparties have the right to subsequently

challenge the unlawful conduct. W. R. Grace and Co. v.

Rubber Workers, 461 U.S. 757 (1983).

This principle applies to consent decrees in other

contexts as well. For example, as Justice Rehnquist noted

in his dissenting opinion in Ashley, a consent decree

12

between the government and a private corporation based

on alleged antitrust violations would not preclude a

future suit by another corporation. Nonparties have an

independent right to bring a private action against the

defendant company for conduct that violates antitrust

laws. 464 U.S. at 902.

Furthermore, this independent right is not lost just

because the challenged conduct may be authorized by the

consent .lecree. Compliance with the decree does not

justify dismissal of any subsequent suit. For example, a

prisoner subsequently harmed by prison conditions

would not be precluded from bringing a suit, even if

those conditions were in accord with a prior court decree.

Such a decree could not bind a prisoner who did not

consent to it. Ashley, 464 U.S. at 902 (Rehnquist, J., dis-

senting from denial of certiorari).

The same reasoning applies equally to a consent

decree entered in an employment discrimination proceed-

ing. Although such a decree binds those who consent to

it, it “cannot be used as a shield against all future suits by

nonpart? « seeking to challenge conduct that may or may

not be ge ..ned by the decree.” Id. at 902.

The distinction between a consent decree and a court

order is important here. “The voluntary nature of a con-

sent decree is its most fundamental characteristic.” Cleve-

land, 92 L. Ed. 2d at 423. A consent decree by definition

binds only those who consent to it. Id. at 524. A court

who enters a consent decree does not resolve the under-

lying action on the merits, even though it must determine

that the settlement is fair and reasonable. Id. at 423.

13

In determining that the white fire fighters were not

adequately represented and therefore not bound, the

court below emphasized several important factors. First,

since the City did not defend the initial racial discrimina-

tion suit they hardly could have represented the non-

minority plaintiffs’ interests in the events which led to

the entry of the decrees. In addition, the Eleventh Circuit

characterized the City’s interest as that of a “disinterested

stakeholder with respect to the contested promotions.”!

In re Birmingham, 833 F.2d at 1499.

The court also noted that the original claim of

employment discrimination was not adjudicated on its

merits in the District Court prior to entry of the consent

decree. Finally, the court noted that the City voluntarily

entered into the consent decree. This voluntary settle-

ment of the discrimination claim through the consent

decree did not entitle it to bargain away the rights of its

existing employees, however. In this respect a consent

decree is given no greater weight than a voluntary affirm-

ative action plan. Cleveland, 478 U.S. at 517.

Thus the appeals court in Birmingham correctly deter-

mined that the white fire fighters’ subsequent suit was

not an impermissible collateral attack on the consent

decree.

1 This is an understatement. The Eleventh Circuit did not go

far enough; the City of Birmingham was not just a disin-

terested stakeholder but, more accurately, the alleged wrong-

doer in the employment discrimination case.

14

II

THE RULE OF MANDATORY INTERVENTION

WHICH PETITIONERS ASK THE COURT TO

ADOPT IS INVALID UNDER DUE PROCESS

Due process requires that the nonparty fire fighters

be provided a constitutionally adequate opportunity to

assert their interests. Mullane v. Central Hanover Bank and

Trust Company, 339 U.S. 306 (1950). The City’s interpreta-

tion of Federal Rules of Civil Procedure, Rule 24, how-

ever, would not provide the fire fighters with such an

opportunity. In fact, the argument the City advances to

support its “intervene or be precluded rule” ignores the

precise issue presented by this case. It is not enough to

ask whether notice and an opportunity to be heard in the

original action preclude any subsequent action challeng-

ing the decrees. This determination alone does not con-

clude the analysis.

Notice and opportunity to be heard requirements

were not satisfied here, but irrespective of whether these

requirements were in fact met in this case, petitioners fail

to address the particular facts which are highly relevant

to resolution of this case. Namely, that the fire fighters

simply were not required to intervene. Rule 24 of Federal

Rules of Civil Procedure allows intervention; it does not

compel it.

The City contends that the nonparty employees must

intervene in the consent decree proceedings under Fed-

eral Rules of Civil Procedure, Rule 24(a), which provides:

15

“Upon timely application anyone shall be permit-

ted to intervene in an action . . . (2) when the appli-

cant claims an interest relating to the property or

transaction which is the subject of the action and the

applicant is so situated that the disposition of the

action may as a practical matter impair or impede the

applicant’s ability to protect that interest, unless the

applicant’s interest is adequately represented by exist-

ing parties.” (Emphasis added.)

The nonparty fire fighters should have little difficulty

in satisfying the interest and impairment requirements.

Nonetheless, for purposes of the present argument, only

the timeliness requirement is relevant here. (For an excel-

lent analysis of the timeliness requirement of Rule 24,

upon which this argument is based, see Kramer, L., Con-

sent Decrees and the Rights of Third Parties, 87 Mich. L. Rev.

___ (1988), to be published in November. A copy of the

article has been lodged with the Court by the author.

The City concludes that intervention under Rule 24

provides the individual fire fighters with a constitu-

tionally adequate opportunity to protect their interests.

This conclusion, however, is incorrect. Rule 24 does not

require the parties to notify the would be intervenors but

instead puts the burden on nonparties to intervene and in

addition provides that nonparties’ motions to intervene

can be denied if “untimely.” However, the City’s inter-

pretation of the rule means that the nonparty employees

can be precluded from a subsequent suit even if the only

notice they had of the prior proceeding was published in

a newspaper, which was the case here. This is not consis-

tent with due process.

If nonparties are to have some due process protec-

tions, Rule 24’s timeliness requirement should be applied

16

as follows: the first step under Rule 24’s timeliness

requirement is to determine when the nonparty fire

fighters knew or should have known their interests were

threatened. See Kramer, supra. The most obvious answer,

is that they knew at the time they were actually injured

by petitioners, i.e., when they were denied promotions

because of race-conscious practices made pursuant to the

terms of the decree. They did not acquire an interest until

after the entry of the decree, since they could not know

ahead of time which employees would actually be

affected by the race-conscious hiring and promotions

practice. Thus, before the challenged promotions were

made, the nonparty fire fighters could not have alleged

any injury.

Due process is violated therefore when timeliness is

measured before a consent decree is entered. The threat

to nonminority employees’ interests is too uncertain at

that time to impose a “duty” to intervene. The City’s

argument that the nonparty fire fighters were required to

intervene prior to entry of decree cannot withstand scru-

tiny under this due process analysis.

The next step of Rule 24’s timeliness requirement, to

be applied consistent with due process, is to determine

how much time is reasonable after the nonparty knew or

should have known intervention was necessary. To the

extent the City’s interpretation preempts the applicable

statute of limitations, it modifies the substantive rights of

the nonparty employees. See Kramer, supra. Courts are

not authorized to modify these rights. See 28 U.S.C.

§ 2072. For example, Rule 24’s timeliness requirements

cannot shorten the statutorily prescribed limitations

period in Title VII (42 U.S.C. § 2000e-5(f)(1)).

17

The purpose of litigation is to settle the claims of

parties only. If the parties prefer to negotiate a settlement

rather than fully litigate the case, then such a disposition

would reach the desired result also, i.e., to settle the

claims. However, it would be a distortion of the legal

process for courts or parties to proceed on the basis that

other persons’ rights should be sacrificed in order to

facilitate settlement in the present action.

Moreover, whether the white fire fighters, who are

the plaintiffs-respondents in this case, could have inter-

vened is irrelevant under this analysis. After the fire

fighters union’s motion to intervene was denied as

untimely, the individual fire fighters had no reason to

believe that they had to intervene or that they would

even be allowed to. Furthermore, once the order denying

intervention to the union was affirmed by the appeals

court the individual fire fighters instituted a separate

action pursuant to the appeals court decision which

stated that they had an independent right to challenge

the illegal conduct after the decrees had been approved.

United States v. Jefferson County, 720 F.2d 1511, 1518 (11th

Cir. 1983).

In a motion to intervene, prior to entry of the

decrees, the nonparty employees could not have alleged

any actual injury since the court had not yet approved the

decrees. Id. at 1518. Because their interests had not yet

been adversely affected, their right to assert their claims

was not impaired as long as they could bring a subse-

quent suit. Jd. at 1518. Thus, the appeals court properly

rejected the impermissible collateral attack argument as

unjustified to dismiss the subsequent suit by the non-

party employees.

18

In addition to an adequate opportunity to be heard,

notice must also comply with due process requirements.

If a consent decree is to bind interested third parties,

formal notice is required even if the party knows the

proceedings are pending. See Mullane v. Central Hanover

Bank and Trust Co., 339 U.S. at 314.

The nonparty employees did not receive formal or

informative notice; notice was by publication in two

newspapers. Petitioners’ Appendix 146a. Although the

appeals court noted that the union members knew at an

early stage that their rights might be adversely affected,

they were never formally notified that they must choose

between intervening or being bound by the result. Mul-

lane, 393 U.S. at 314. Since the individual nonminority

employees could not have known with any certainty

whether their own interests were adversely affected, it

would be foreign to our concept of justice to bind them

on a theory of mandatory intervention.

Thus, the collateral attack doctrine must be rejected;

it cannot bar subsequent suits on a mandatory interven-

tion theory. In addition, the right to bring a cause of ©

action under Title VII is a property right that cannot be

extinguished. Logan v. Zimmerman Brush Co., 455 U.S. 422,

428 (1982).

Interven ‘7 under Rule 24 is allowed; it is not man-

datory. If the City wanted to be sure that all interested

persons are adequately represented in the proceedings it

would have had to join them as “indispensable parties”

under Rule 19 governing joinder.

Joinder under Federal Rules of Civil Procedure, Rule

19, would make the duty to join interested third persons

19

mandatory and thus eliminate the need to bar subsequent

claims. Joinder would make it the parties’ responsibility

to see that all interested persons are before the court; it

would not shift the responsibility to nonparties, as the

City attempts to do. Despite the City’s objection to join-

der, it nonetheless is a far better alternative than manda-

tory intervention which places an excessive burden on

nonparties.

Ill

TITLE VII’S POLICY FAVORING

VOLUNTARY SETTLEMENT OF EMPLOYMENT

DISCRIMINATION DISPUTES DOES NOT JUSTIFY

UNLAWFUL DISCRIMINATION AGAINST

EXISTING EMPLOYEES

The City contends that voluntary resolution of

employment discrimination claims far outweighs any rea-

son for allowing subsequent suits. This conclusion, how-

ever, is simply unjustified. Policy favoring settlement is

not license for trammeling the rights of nonminority

employees.

Moreover, the policy favoring settlement is not the

only policy in Title VII. Congress has expressed a compet-

ing policy. By giving nonminority employees the same

right to bring Title VII suits as minorities, Congress

intended that the interests of all employees, regardless of

race, be protected. McDonald v. Santa Fe Trail, 427 U.S.

273, 280 (1976).

The policies favoring settlement are reflected in the

procedural requirements of Title VII and the role it cre-

ates for the Equal Employment Opportunity Commission

(EEOC). Alexander v. Gardner-Denver Co., 415 U.S. 36

20

(1974). The procedural requirements of Title VII provide

the opportunity to settle disputes by “informal methods

of conference, conciliation and persuasion” before a

plaintiff may file a lawsuit. Title VII § 706(b), 42 U.S.C.

§ 2000e-5(b).

These requirements, however, pertain only to the

period prior to filing of a suit. In the provisions gover-

ning the conduct of Title VII suits after the action is

commenced, only one provision clearly promotes settle-

ment; this provision provides for stays of Title VII suits -

or of additional efforts to conciliate. Title VII § 706(f)(1),

42 U.S.C. § 2000e-5(f)(1).

Congress, however, could have easily adopted cer-

tain measures to further the settlement policy after filing

of the suit. They did not adopt such postfiling measures,

however, and therefore this policy primarily applies to

the period before a suit is filed. Consequently, the courts

are not authorized to dismiss reverse discrimination suits

in order to promote voluntary settlement of employment

discrimination claims.

Moreover, the substantive rights of nonminority

employees are meaningless if they are denied the oppor-

tunity to assert them. “The policy favoring voluntary

settlement does not, of course, countenance unlawful dis-

crimination against existing employees ... .” Firefighters

Local Union No. 1784 v. Stotts, 467 U.S. at 589 n.4 (O’Con-

nor, J., concurring).

The Eleventh Circuit properly considered all of the

above concerns in its determination. The Eleventh Cir-

cuit’s decision successfully attempts to balance carefully

21

all the competing interests. This Court should acknowl-

edge the need to be more sensitive to nonminority

employees who have carried most of the burden of reme-

dying the effects of past discrimination.

If make whole relief were provided only to those

who have been victims of actual discrimination, much of

the current confusion and conflict in the consent decree

context would no longer exist. A decision by this Court to

uphold the Eleventh Circuit’s opinion would resolve

much of the uncertainty that surrounds consent decree

proceedings. In addition, steps can be taken to help elimi-

nate many of the concerns expressed by the petitioners.

For example, finality of judgments will not be seri-

ously undeiimined if this Court upholds the decision

below. There are several possible alternatives for courts

to explore. The timeliness requirement of Rule 24 could

be relaxed to allow intervention at any stage. Another

alternative would be to require the parties to join inter-

ested third parties under Rule 19.

Employers cannot use consent decrees as a shield

against future challenges to illegal unconstitutional hir-

ing and promotion quotas. If parties to consent decrees

are immunized from charges of discrimination by non-

parties, there is no reason to expect that these employers

will impose upon themselves a duty to protect the inter-

ests of existing employees.

If parties are reluctant to settle their Title VII claims

by consent decree if those actions will be subject to

attack, then they are free to litigate the action instead, just

as they would have done had a consent decree not been

22

an acceptable settlement device. The rights of non-

minority employees under the Constitution and Title VII

cannot be surrendered at the will of their employers.

= 4

CONCLUSION

The City’s argument must ultimately be rejected. The

nonparty fire fighters’ suit challenging the race-conscious

promotions made after entry of the consent decrees is not

an impermissible collateral attack. Dismissing the subse-

quent suits on a theory of mandatory intervention has the

unjust consequence of precluding the white employees,

who themselves were denied promotions based on race,

from ever having their claims heard on the merits. Con-

sent decrees cannot be used as a shield against challenges

to illegal and unconstitutional hiring and promotion

practices.

The rule that nonparties to a prior proceeding are not

bound by the judgment is nearly 200 years old. As Justice

Rehnquist noted in his dissenting opinion in Ashley v.

City of Jackson, 464 U.S. at 901, this principle is part of the

“deep-rooted historic tradition” that everyone is entitled

to his or her own day in court. Id.

The nonparty employees were not required to inter-

vene because their claims did not even accrue until their

interests were adversely affected by the challenged pro-

motions made after entry of the consent decrees. More-

over, had they tried to intervene, their attempt would

have fared no better than their union’s attempted inter-

vention, which was denied as untimely. The Eleventh

Circuit noted in affirming the District Court’s denial of

Oe. ee ee

ne a ee eee

23

intervention that the union members could not have

alleged any unlawful discrimination in their motion to

intervene because the court had not yet given final

approval to the consent decrees. United States v. Jefferson,

720 F.2d at 1518. Moreover, the appeals court said that the

members could present such a claim after the decrees had

been entered by “instituting an independent Title VII

suit, asserting the specific violations of their rights.” Id.

That is exactly what the nonparty employees did;

they filed a subsequent suit after they were denied pro-

motions pursuant to race-conscious certifications estab-

lished by the consent decree. The timeliness requirement

of Rule 24 of Federal Rules of Civil Procedure allows

intervention, but does not compel it. Since the nonparty

employees were unable to intervene, their only alterna-

tive was to challenge in a separate action the unlawful

remedies contained in the consent decree. Pacific Legal

Foundation urges that the decision of the Eleventh Cir-

cuit be upheld; it is in the public interest that nonparty

employees, themselves victims of unlawful] discrimina-

tion, have the opportunity to prove that their equal pro-

tection and Title VII rights have been violated.

DATED: September, 1988.

Respecfully submitted,

Of Counsel RONALD A. ZUMBRUN

*ANTHONY T. Caso

DesoraH L. GARLIN *CouNsEL Or RecorpD

Paciric LEGAL FOUNDATION Paciric LEGAL FOUNDATION

555 Capitol Mall, Suite 350 555 Capitol Mall, Suite 350

Sacramento, CA 95814 Sacramento, CA 95814

Telephone: (916) 444-0154 Telephone: (916) 444-0154

Attorneys for Amicus Curiae,

Pacific Legal Foundation