Appendix — Patterson v. Newspaper & Mail Deliverers Union

9SITS84MAY9 1994

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ee

IN THE °

Supreme Court of the GAnited States

OCTOBER TERM, 1993

JOHN PATTERSON, et al.,

Petitioners,

ve

NEWSPAPER AND MAIL DELIVERERS UNION, et al.,

Respondents.

On Petition for Writ of Certiorari te the United

States Court of Appeals for the Second Circuit

APPENDIX TO THE PETITION FOR

A WRIT OF CERTIORARI

ELAINE R. JONES

DIRECTOR-COUNSEL

THEODORE M. SHAW

CHARLES STEPHEN RALSTON

(Counsel of Record)

NAACP LEGAL DEFENSE AND

EDUCATIONAL FUND, INC.

99 Hudson Street

Sixteenth Floor

New York, NY 10013

(212) 219-1900

PENDA D. Hair

NAACP LEGAL DEFENSE AND

EDUCATIONAL FuND, INC.

1275 K Street, N.W.

Suite 301

Washington, D.C. 20005

(202) 682-1300

Attorneys for Petitioners

PRESS OF BYRON S. ADAMS, WASHINGTON, D.C. 1-800-347-8208 ‘}

TABLE OF CONTENTS

Decision of the United States Court of Appeals

for the Second Circuit, December 20, 1993 ......... la

Order of the Second Circuit Denying Rehearing .... 13a

Memorandum Opinion and Order of the United States

District Court for the Southern District of New

Pe EE HEN Bs obo vb bees iviecctoceces 15a

Final Order and Judgment, United States District

Court for the Southern District of New York,

En re 33a

Decision of the United States Court of Appeals for

the Second Circuit, March 20, 1975 .............. 36a

Memorandum Opinion of the United States District

Court for the Southern District of New York,

ge rr ee re 55a

Memorandum Opinion of the United States District

Court for the Southern District of New York,

de occa 63a

Memorandum Opinion of the United States District

Court for the Southern District of New York,

ee ek 6c <e . 68a

Opinion and Order of the United States District

Court for the Southern District of New York,

I ES oro col cous whebe bo euee ee 75a

Opinion and Order of the United States District

Court for the Southern District of New York,

IY Goh oon oe sod wes tc oe bes oc 93a

ii

Opinion and Order of the United States District

Court for the Southern District of New York,

AD Meeeeerre rs ee eee

Opinion and Order of the United States District

Court for the Southern District of New York,

Soptemiver SU, 1992 «cs ccovvseyetseneeenees

la

Nos. 1476, 1480 -- August Term, 1992

Docket Nos. 92-7964, 6242

United States Court of Appeals

Second Circuit

JOHN R. PATTERSON, ROLAND J. BROUSSARD,

ELMER STEVENSON, on their own behalf and on

behalf of all other persons similarly situated, and EQUAL

EMPLOYMENT OPPORTUNITY COMMISSION,

Plaintiffs-Appellants,

v.

NEWSPAPER & MAIL DELIVERERS’ UNION OF

NEW YORK & VICINITY, et. al.,

Defendants-Appellees.

Argued June 21, 1993

Decided December 20, 1993.

Before: NEWMAN, Chief Judge,

VAN GRAAFEILAND and ALTIMARI, Chief Judges.

Appeal from the July 30, 1992, order of the United

States District Court for the Southern District of New York

(William C. Conner, Judge) vacating a consent decree

originally approved in 1974, 797 F. Supp. 1174 (S.D.N.Y.

1992).

AFFIRMED

JON O. NEWMAN, Chief Judge:

2a

This appeal primarily concerns the appropriate

standard for modification of a consent decree in litigation

not involving a governmental entity as a party. The Equal

Employment Opportunity Commission ("EEOC") and a class

of minority employees appeal from the July 30, 1992, order

of the District Court for the Southern District of New York

(William C. Conner, Judge). vacating in its entirety a consent

decree originally approved in 1974. Patterson v. Newspaper

& Mail Deliverers’ Union, 797 F. Supp. 1174 (S.D.N.Y. 1992).

The decree created a comprehensive affirmative action

program for New York City area Newspaper Deliverers. In

addition, the decree contains broad prohibitions against

discrimination and provides for an Administrator to enforce

the anti-discrimination and affirmative action provisions. On

appeal, EEOC and the minority employee class represented

by the NAACP Legal Defense and Educational Fund, Inc.

("LDF"), contend that the District Court applied the wrong

standard in deciding whether to modify any aspect of the

decree. LDF argues that none of the decree should have

been vacated; the EEOC argues that the District Court erred

in vacating the anti-discrimination provisions, but takes no

position with respect to the affirmative action program and

the Administrator.

We conclude that the District Court applied the

correct standard and was entitled to vacate the entire

consent decree since its essential purpose had been achieved.

We therefore affirm.

Background

Through closed and union shop agreements,

defendant Newspaper & Mail Deliverers’ Union ("the

Union") controls access to newspaper and publication

delivery jobs in the New York City region. From 1901 to

1952, the Union limited membership to the legitimate first-

bor sons of other Union members. In 1952, the Union

abandoned its primogeniture system, and, with the

cooperation of the New York City area newspapers and

3a

publishers, adopted a new series of membership and work

rules. This system divided workers into those holding

permanent jobs, which are said to have "regular situations,"

and those employed irregularly, who are called "shapers."

The shapers were further divided into groups with

descending daily hiring priority. Each employer maintained

a "Group I" list, which was restricted to persons who had

once held regular situations in the industry. After offering

daily work to each person on the Group I list, the employer

next looked to an industry-wide Group II list, which

consisted of all persons in the industry on Group I lists or

holding regular situations. Thus, Group II provided an

opportunity for deliverers to supplement their income at an

employer other than their usual employer. If additional daily

work was available, the major employers would look to a

Group III list, which consisted of persons who appeared for

daily work a minimum number of times per week, even if no

work was available. Union membership was limited to

persons holding regular situations, and minorities were

discouraged from joining the Group III lists. Moreover,

although by contract the group lists provided the basis for

filing vacant regular situations, various abuses made it nearly

impossible for anyone to move from Group III to a regular

situation. The Union allowed employees at one employer to

shift to the Group I list of another employer and

occasionally provided Group I status to relatives and

associates of Union members.

In 1973, EEOC and a group of minority deliverers,

who sued for themselves and others similarly situated,

brought separate actions against the Union and the

employers under Title VII of the 1964 Civil Rights Act.

They contended that the 1952 system, although facially

neutral, perpetuated discrimination against minorities. The

cases were consolidated and brought to trial before then-

District Judge Pierce. After all the evidence was presented,

but before the District Court ruled, the parties entered into

a settlement agreement, which Judge Pierce approved and

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incorporated into a final judgment. Patterson v. Newspaper

& Mail Delivers’ Union, 384 F. Supp. 585 (S.D.N.Y. 1974).

The judgment directs the Union and employers to implement

and perform the agreement, and retains jurisdiction in the

District Court for enforcement and any subsequent

applications. In a written opinion, Judge Pierce made

detailed factual findings of a long-established pattern of

discrimination against minorities. Statistically, minorities

accounted for 30 percent of the eligible workforce, and only

two percent of deliverers (with an even smaller percentage

among regular situation holders and Group I members). We

affirmed Judge Pierce’s decision over the objection of White

Group III deliverers who complained that the agreement

unfairly favored minorities. Patterson v. Newspaper & Mail

Deliverers’ Union, 514 F.2d 767 (2d Cir. 1975), cert. denied,

427 U.S. 911 (1976).

The settlement agreement contains five sections. The

introductory section consists of a series of "whereas" clauses,

stating that there has been no admission of a violation of law

but acknowledging the existence of a "statistical imbalance"

in minority representation. The final clause of this section

states that the agreement "is designed to correct the

aforesaid statistical imbalance, to remedy and eradicate its

effects, and to put minority individuals in the position they

would have occupied had the aforesaid statistical imbalance

not existed." Section A of the agreement consists of broad

prohibition against any action with a discriminatory effect by

either the Union (1 1) or employers (7 2). Section B of the

agreement creates the office of the Administrator. The

Administrator is authorized to resolve all complaints

involving disparate treatment, subject to review by the

District Court (14). His term is fixed as "an initial period of

five (5) years"; subsequently he or his successor "shall remain

in office if and for such time as the Court may direct" (9

6).

Section C of the agreement is a detailed affirmative

action program. The purpose of the program is to achieve

Sa

"a minimum goal of 25% minority employment in the

industry . . . by June 1, 1979" (1 7), although the following

paragraph states that this level "is not an inflexible quota but

an objective" (1 8). To achieve this goal, the agreement

provides that all minorities currently in Group III are to be

moved up immediately to Group I (% 9); that regular

situation positions are to be filled exclusively from Group I

by seniority (1 10); that for each regular situation filled, one

Group III deliverer will move up to Group I, alternating

between the most senior minority and most senior

nonminority (1 11); and that Group III vacancies are to be

filled with three minorities for every two nonminorities

(115). Various other provisions establish slight variations

for certain employers (11 12-13), impose some special one-

time rules (% 14), limit transfers (17 18-19), and require the

Union to offer membership to anyone in Group I (4 20).

Finally, section D of the agreement, entitled "general

provisions,” require employers to help qualified individuals

apply for employment (1 28), regulates employment

applications (1 29), requires compliance reports (19 30-31),

provides for backpay to certain members of the class (11 37,

39), and provides for continued jurisdiction in the District

Court (1 4). The only provision in section D that arguably

contemplates the termination of the agreement is paragraph

33, which states that inconsistent provisions in collective

bargaining agreements are suspended, but "may be put into

effect when the order terminates, unless the Court orders

otherwise.”

By 1979, minority employment was only 13.3 percent,

and Judge Pierce ordered the office of the Administrator

extended for another five years. Patterson v. Newspaper &

Mail Deliverers’ Union, 23 Empl. Prac. Dec. (CCH) 1% 31,001

(S.D.N.Y. 1980). In 1984, the office was extended on an

indefinite basis. In 1985, the defendants moved to terminate

the order embodying the settlement agreement on the

ground that the 25 percent goal had been reached. In 1987,

Judge Conner, to whom the case has been reassigned, found

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6a

that while some employers had reached 25 percent minority

employment, the goal of the settlement agreement was

industry-wide minority representation of 25 percent. Judge

Conner deferred further consideration of the motion until

there was sufficient evidence that this goal had been

attained. In November 1988. Judge Conner concluded that

there was sufficient evidence to suspend operation of the two

ratios in the affirmative action program (i.e., the 50 percent

quota for filling Group I vacancies and the 60 percent quota

for filling Group III vacancies) pending resolution of the

motion.

In May 1991, the Interim Administrator submitted a

report finding an industry-wide fig. ‘¢ of 28.53 percent and

substantial compliance by most employers. After the

plaintiff's declined to challenge this figure, the District Court

scheduled a hearing on vacating the entire order. The

private plaintiff's opposed vacation of any part of the decree.

EEOC did not oppose termination of the affirmative action

program, but argued that paragraphs 1, 2, 20, 28, 29, 33, and

41 of the settlement agreement should be retained.

In a comprehensive opinion dated July 8, 1992, Judge

Conner concluded that the order should be vacated in its

entirety. He ruled that modern cases have established a

flexible standard for vacating consent decrees, and that this

standard allowed termination of a decree once its primary

purpose had been attained. He rejected the private

plaintiffs’ argument that the decree had to remain in force

until every facet of discrimination was eliminated, and

rejected the EEOC’s argument as a "cut and paste

approach.” Plaintiffs filed a motion to amend the judgment

under Fed. R. Civ. P. 59(e), which was denied. However, the

District Court modified its earlier order so as to allow

discrimination claims filed with the Administrator prior to

July 8, 1992, to be processed.

Discussion

I. Legal standard for modification of a consent decree

Ta

EEOC primarily contends that the District Court

erred in applying a flexible standard for modification of the

consent decree instead of applying a more rigorous standard.

The rigorous standard urged by EEOC dates from United

States v. Swift & Co., 286 U.S. 106 (9132), in which the

Supreme Court held that an antitrust consent decree could

not be modified unless the defendant showed that the

dangers leading to implementation of the decree had become

"attenuated to a shadow," id. at 119. The Court also held

that "[nJothing less than a clear showing of grievous wrong

evoked by new and unforeseen conditions should lead us to

change what was decreed after years of litigation with the

consent of ali concerned.” Jd.

The adoption of a more flexible standard was

intimated in United States v. United Shoe Machinery Corp.,

391 U.S. 241 (1968), in which the Supreme Court cautioned

that the "grievous wrong" standard should not be read out of

context, and allowed the United States to obtain

modification of an antitrust injunction in order to strengthen

restrictions on the defendant. The seminal case actually

applying a more flexible standard is New York State

Association for Retarded Children, Inc. v. Carey., 706 F.2d 956

(2d Cir.), cert. denied, 464 U.S. 915 (1983). Judge Friendly’s

opinion read Swint’s "grievous wrong" language as limited to

the special facts of that case, and found that the appropriate

standard, at least in an institutional reform case, was one of

flexibility, leaving to the District Court a "rather free hand,"

id. at 970. Two recent Supreme Court cases have held that

district courts erred in applying Swift, rather than a more

flexible standard, to the modification of consent decrees or

injunctions in institutional reform cases. In Board of

Education of Oklahoma City Public Schools v. Dowell, 498

U.S. 237 (1991), the Court held that a finding that a school

district was operating constitutionally and unlikely to return

to its past ways mandated the termination of a desegregation

order. In Rufo v. Inmates of Suffolk County Jail, 112 S.Ct.

748 (1992), the Court held that any showing of a significant

8a

change in factual conditions or law would justify a

modification of a decree enjoining double bunking and

requiring officials to build a new prison; the Court remanded

for consideration of whether an upsurge in prison population

had been unforeseen.

In the pending case, the District Court rejected

EEOC’s contention "that this case is governed solely by...

Swift", 797 F.Supp. at 1179, and looked to the flexible

standard of Dowell and Rufo. In an important footnote,

Judge Conner noted that though the flexible standard had

previously "only been invoked in cases where the conduct of

a governmental facility or operation was being regulated,"

the present case sufficiently implicated "the public’s right in

seeing that persons are not deprived of fundamental rights"

to come within the "institutional reform exception.” Jd. at-

1180 n.8.

EEOC is probably correct that the District Court’s

decision is the first to explicitly adopt the flexible standard

of Dowell and Rufo, rather than the rigorous standard of

Swift, in a case not involving a governmental entity. It is also

true that the recent Supreme Court cases have each, to an

extent, invoked federalism and democratic rule concerns as

a justification for their use of a flexible standard in the

context of institutional reform litigation, see Rufo, 112 S.Ct.

at 758-59; Dowell, 111 S.Ct. at 637. But New York State

Association makes a more general argument for the flexible

standard, based on the difficulties in implementing any

complex decree in the institutional setting, see, 706 F.2d at

969-70, and the discussion of Swift in each of the leading

cases, as well as in United Shoe, suggest that Swift is a special

case that should not be read as setting down a general

standard for all future cases. See Rufo, 112 S.Ct. at 758

("Our decisions since Swift reinforce the conclusion that the

‘grievous wrong’ language of Swift was not intended to take

on a talismanic quality, warding off virtually all efforts to

modify consent decrees."); Dowell, 111 S.Ct. at 636; United

Shoe, 391 U.S. at 248; New York State Association, 706 F.2d

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9a

at 968-69. Moreover, we have suggested in a post-Rufo

decision, Still’s Pharmacy, Inc. v. Cuomo, 981 F.2d 632 (2d

Cir. 1992), that Rufo constitutes a wholesale change, not

limited to institutional reform cases. See id. at 636-37 (citing

District Court decision in this case for approval).

Among other circuits, there appears to be some

dispute as to the appropriate standard for modifying consent

judgments. The Seventh Circuit has flatly declared that Rufo

gave the "coup de grace" to Swift, noting that although Rufo

involved institutional reform litigation, the ‘flexible standard’

_. . is no less suitable to other types of equitable case." In

re Hendrix, 986 F.2d 195, 198 (7th Cir. 1993). Three circuits

have said that Swift’s strict standard has been relaxed in

institutional reform litigation, Lorain NAACP v. Lorain Bad.

of Education, 979 F.2d 1141, 1149 (6th Cir. 1992), cert.

denied, 113 S.Ct. 2998 (1993); W.L. Gore & Associates, Inc.

v. CR Bard, Inc., 799 F.2d 558, 562 (Fed. Cir. 1992); Epp v.

Kerrey, 964 F.2d 754, 756 (8th Cir. 1992), but two of these

courts have not considered the appropriate standard in

public issues litigation not involving a governmental entity,

see Lorain NAACP, 979 F.2d at 1149; Epp, 964 F.2d at 756,

and one merely declined to apply the flexible standard to

traditional commercial litigation, W.L. Gore, 977 F.2d at 562.

We agree with Judge Conner that the flexible

standard outlined in Dowell and Rufo is not limited to cases

in which institutional reform is achieved in litigation brought

directly against a governmental entity. The "institution"

sought to be reformed need not be an instrumentality of

government. If a decree seeks pervasive change in long-

established practices affecting a large number of people, and

the changes are sought to vindicate significant rights of a

public nature, it is appropriate to apply a flexible standard in

determining when modification or termination should be

ordered in light of either changed circumstances Or

substantial attainment of the decree’s objective. Decrees in

this context typically have effects beyond the parties to the

lawsuit, as is true of the provisions for affirmative action

10a

remedies in this case. Though it is important to make sure

that agreements in such litigation are not lightly modified, it

is also important to enter into constructive settlements so

that protracted litigation can be avoided and useful remedies

developed by agreement, rather than by judicial command.

There is an inevitable tension between the objectives of

promoting adherence to agreements and of fostering a

climate in which constructive settlements may be readily

reached. For plaintiffs, the certainty that an agreement will

be enforced without modification is an incentive to negotiate

a settlement that achieves some, though not all, of what

might have been obtained in litigation. For defendants,

however, it is the prospect of modification as circumstances

change or objectives are substantially reached that provides

the incentive to settle on reasonable terms, rather than

adamantly resist in a protracted litigation. The tension

between these competing objectives cannot be eliminated,

but it can and should be sensitively adjusted by courts of

equity, exercising their historic powers both to provide

remedial relief and, when appropriate, to terminate their

authority. We therefore agree with Judge Conner that it was

appropriate to apply a flexible standard in determining

whether to dissolve the decree.

y Application of the standard

In considering the District court’s decision to vacate

the entire decree, it will be convenient to focus initially on

the affirmative action provisions of the decree. Only the

LDF contends that these provisions should be retained.

LDF does not dispute that minority representation has

reached 25 percent, nor even the District Court’s finding that

minority representation is likely to increase since many white

employees with regular situations are near retirement age

and the Group I and Group III lists contain greater than 25

percent minority representation. LDF also does not dispute

that it would have been proper to suspend the fixed quotas

had the defendants achieved the 25 percent goal by 1979.

But LDF contends that the defendants’ failure to meet that

lla

goal by 1979 requires (a) setting a new goal now,

commensurate with the percentage of minorities in the

qualified workforce, and (b) retaining the hiring quotas until

the new goal is met. LDF states that the 1980 census

showed that minorities constituted 42 percent of the

workforce, and that the 1990 census shows a figure of more

than 50 percent.

LDF relies on Youngblood v. Dalzell, 925 F.2d 954

(6th Cir. 1991), in which the Sixth Circuit reversed the

termination of a consent decree and remanded to the

District Court for further consideration of whether a higher

affirmative action goal should be set after the defendant

failed to meet the goal within the deadline set in the decree.

The decree in that case stated that it was intended to achieve

a “workforce composition which will not support any

inference of racial discrimination in hiring." Jd. at 961. The

consent decree in this case could perhaps be read to support

a similar goal. The decree states that it is intended to

remedy a "statistical imbalance," and it is clear that the 25

percent figure was chosen with reference to the 1970 census

figure of a 30 percent minority workforce. Nevertheless, the

decree does not suggest that its purpose is to achieve total

parity, and the 25 percent figure, as a numerical goal, is

stated in absolute terms, without any suggestion that it is

subject to modification. Indeed, the decree suggests that if

any factor is flexible, it is the time limit. Paragraph 6 allows

extension of the office of Administrator beyond five years,

and paragraph 8 states that the 25 percent goal "is not an

inflexible quota but an objective to be achieved by the

mobilization of available personnel and resources of the

defendants hereto in a good faith effort to maximize

employment opportunities for minorities." Both the difficulty

of achieving 25 percent goal and the likelihood that the

percentage of minorities in the blue collar workforce would

increase were foreseeable in 1974. Whether or not the

District Court might have had discretion to raise the 25

percent figure as a remedy for not meeting it is originally

12a

contemplated, the Court was surely entitled to conclude that

such an increase was not required. Finally, with no increase

in the percentage goal, it was proper to dissolve the 50

percent quota for promotions from Group III to Group I

and the 60 percent quota for listings in Group III.

Once the District Court decided that achievement of

the 25 percent goal justified elimination of the affirmative

action provisions, without any increase in the percentage, it

then had to decide whether to vacate the entire decree.

Though other portions of the decree provide the plaintiff

class with enforcement mechanisms for redressing any

ongoing discrimination that may be more expeditious than

the initiation of new litigation, we agree with Judge Conner

that the decree has served its purpose, and that all of its

provisions may be ended. Again, we do not decide that the

District Court was required to vacate these additional

provisions, only that it was entitled to do so. Application of

the flexible standard for modifying decrees in the context of

this lawsuit seeking broad remedies to change hiring

practices entitles a court of equity to focus on the dominant

objective of the decree and to terminate the entire decree

once that objective has been reached.

Affirmed.

l3a

Docket Nos. 92-7964, 6242

United States Court of Appeals

Second Circuit

JOHN R. PATTERSON, ROLAND J. BROUSSARD;

ELMER STEVENSON, on their own behalf and on

behalf of all other persons similarly situated, and EQUAL

EMPLOYMENT OPPORTUNITY COMMISSION,

Plaintiffs-Appellants,

V.

NEWSPAPER & MAIL DELIVERERS’ UNION OF

NEW YORK & VICINITY, et. al.,

Defendants-Appellees.

Filed February 7, 1994

At a stated term of the United States Court of

Appeals for the Second Circuit, held at the United States

courthouse in the City of New York on the 7th day of

February one thousand and ninety-four.

A petition for rehearing containing a suggestion that

the action be reheard in banc having been filed herein by

Appellant JOHN PATTERSON, ET AL.

Upon consideration by the panel that decided the

appeal, it is

Ordered that said petition for rehearing is DENIED.

———————————————

l4a

It is further noted that the suggestion for rehearing

in banc has been transmitted to the judges of the court in

regular active service and to any other judge that heard the

appeal and that no such judge has requested that a vote be

taken thereon.

FOR THE COURT

GEORGE LANGE, III, Clerk

By:

Carolyn Clark Campbell

Chief Deputy Clerk

15a

Nos. 73 Civ. 3058 and 73 Civ. 4278

Sept. 19, 1974

United States District Court

S. D. New York

JOHN R. PATTERSON, e¢. al.

Plaintiffs,

Vv.

NEWSPAPER & MAIL DELIVERERS’ UNION OF

NEW YORK & VICINITY, e¢. al.,

Defendants.

Supplemental Opinion Oct. 11, 1974

MEMORANDUM OPINION AND ORDER

PIERCE, District Judge

This memorandum approves a settlement reached by

all of the parties after a four-week trial on the merits of two

consolidated actions charging employment discrimination in

the newspaper and publication delivery industry in the New

York City area. The provisions of the agreement are

intended to achieve a 25% minority’ employment goal in the

Minority’ as it is used in this Settlement Agreement refers to the

definition of that word by the Equal Employment Opportunities

(continued...)

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l6a

industry within five years. At the present time, minority

employment in the industry is less than 2%; the comparable

percentage of minorities in the relevant labor force in the

New York City area is approximately 30%. The agreement

also provide for supervision of hiring practices and

employment opportunities in the industry to the benefit of

both minority and non-minority workers.

One of the actions has been brought by the Equal

Employment Opportunity Commission (EEOC) and names

as defendants the Newspaper and Mail Delivery Union of

New York and Vicinity (the Union), the New York Times

(Times), the New York Daily News (News), the New York

Post (Post) and some fifty other publishers and news

distributors within the Union’s jurisdiction. The other action

is a private class action on behalf of minority persons. Both

actions charge that the Union, with the acquiescence of the

publishers and distributors, has historically discriminated

against minorities and that the present structure of the

collective bargaining agreement combined with nepotism and

cronyism and other abuses in employment and referral

practices, have perpetuated the effects of the past

discrimination, in violation of 42 U.S.C. § 2000 et. seq. (Title

VII). Each lawsuit sought an affirmative action program

designed to achieve for minorities the status they would have

had in this industry but for the alleged discriminatory

practices.

Both actions were filed in 1973. After months of

negotiation, the parties reached a settlement agreement in

early 1974 but it was rejected by vote of the Union’s

membership. Following another abortive attempt to obtain

ratification from the membership, the two actions were

consolidated with each other for a hearing on motions for

'(...continued)

Commission and means people who are Black, Spanish-surnamed,

Oriental and American Indian.

17a

preliminary relief before this Court. The hearing

commenced May 14, 1974. At its conclusion on June 12,

1974, the Court ordered the hearing consolidated with trial

on the merits, pursuant to Fed.R.Civ.P. 65(a)(2), giving the

parties the opportunity to present further evidentiary

submissions or testimony. No further evidence was

presented. Instead, the parties having once again entered

into settlement discussions, brought before this Court for

approval a Settlement Agreement dated June 27, 1974,

entered into by all the plaintiffs and all the defendants, and

ratified by the Union membership.

A hearing on the fairness, adequacy and

reasonableness of the Settlement with respect to the

plaintiffs’ class was held on August 27, 1974, after due notice

to that class. On the same date the Court also held a

separate hearing on the legality of the relief provided in the

Settlement and its impact on a group of non-minority

workers who had, prior to trial, been permitted to intervene

in the consolidated actions for the purpose of challenging

any affirmative relief which might have affected their

interests.

The Standards

As a general proposition, when a settlement

agreement is presented to the Court for approval, the

Court’s role is limited to the exercise of its equitable powers.

The Court is not to substitute its judgment for that of the

parties. See, e.g.. Glicken v. Bradford, 35 F.R.D. 144, 151

(S.D.N.Y. 1964); United States v. Carter Products, Inc., 211 F.

Supp. 144, 148 (S.D.N.Y. 1962). Instead, its role is to assure

that the settlement is fair to the class and the parties, and

represents a reasonable resolution of the dispute. See e.g.,

State of West Virginia v. Chas. Pfitzer & Co., 314 F. Supp. 710

(S.D.N.Y. 1970), aff'd, 440 F.2d 1079 (2d Cir.), cert, denied,

404 U.S. 871, 92 S.Ct. 81, 30 L.Ed.2d 115 (1971). Ordinarily,

the Court is not expected to examine conclusively into the

underlying facts or legal merits of the action. See, @g.,

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18a

Newman v. Stein, 464 F.2d 689, 691 (2d Cir.), cert. denied,

409 U.S. 1030, 93 S.Ct. 521, 34 L.Ed.2d 488 (1972); United

States v. Carter Products, Inc., Supra, 211 F. Supp. at 148.

But, this is not an ordinary case, it must be

recognized that efforts to correct discrimination affect the

strongest public sensitivities. The interests involved are far

broader than those of the particular parties in a particular

lawsuit. Therefore, the parties cannot be permitted to settle

for less than, or for more than, the facts of the case and

public policy expressed in Title VII mandate. Thus, although

the Court is of the opinion that even at this late stage public

policy is served by an agreement rather than an adjudication,

a more searching discussion of the merit is warranted. In

fact, the state of the law in this Circuit may require certain

findings of fact to support affirmative action in a Title VII

case even when it is resolved by settlement. See, Ross v.

Enterprise Association Steamfitters Local 636, 501 F.2d 622,

628 n.4 (2d Cir. 1974), explaining United States v. Wood, Wire

and Metal Lathers International Union, 471 F.2d 408 (2d Cir.

1973), cert. denied, 412 U.S. 939, 93 S.Ct. 2773, 37 L.Ed.2d

398 (1973). Further, a more conclusive examination of the

merits is necessary in this case because the affirmative action

program and the minority goal in principle, and the 25%

minority goal are all vigorously disputed by the intervenors.

Inasmuch as this Court has heard a four-week

completed trial in these actions, it is in a unique position to

find facts and to set forth conclusions of law. Therefore,

what follows shall constitute this Court’s findings and

conclusions to the extent that they form the necessary legal

support for the affirmative action proposed.

The Background

Most of the facts are not contested. The Union is the

exclusive bargaining agent for a collective bargaining unit

encompassing the work performed in the deliverers’

departments of newspaper and publication distributors in the

19a

New York area. Its geographic jurisdiction has been

variously stated, but it is fair to define it by where the

employers in the industry are located: in the metropolitan

area of New York City (within a fifty mile radius of

Columbus Circle), the New York counties of Nassau and

Suffolk, the New Jersey counties of Bergen, Essex, Hudson,

Middlesex, Monmouth, Passaic and Union, and the

Connecticut county of Fairfield.

The nature of the delivery industry is such that the

employers’ needs for delivery department employees vary

from day to day, and indeed, shift to shift, depending upon

the size and quality of the publication(s) being distributed.

Thus, each employer by the terms of the Union contract,

maintains a regular work force (Regular Situation holders)

for its minimum needs, and depends upon daily shapers to

supplement the force. By the terms of the contract, at the

major employers the shapers are categorized into groups

with descending daily hiring priorities. The Group I list of

shapers is restricted, by contract, to persons who have at one

time held a Regular Situation in the industry. They have

first shaping priority at every shift, in order of their shop

seniority. After the Group I is exhausted at any given shift,

the contract provides that the next hiring priority shall go to

Group II members. Group II consists of all persons in

Group I and all persons holding Regular Situations in the

industry. Once all of the Group II members who have

appeared for the shape are put to work, the contract

provides that the remaining open jobs, if any, will go to

Group III members who have appeared for the shape, in

order of their shop tenure.

The shaping system is considerably less structured for

the smaller publications and distributors, and, in fact at the

this time, only the News and the Times maintain Group III

lists of any significant size.

All of the jobs in the industry are within the Union’s

jurisdiction, whether performed by Regular Situation holders

20a

or by any of the members of the various groups, or any one

who shapes at all. The jobs are essentially the same,

regardless of the status of the worker who fills them, and are

all relatively unskilled. Most workers drive trucks or do floor

work. However, because the contract provides that a

Regular Situation is a prerequisite to Union membership,

only Regular Situation holders and members of Group I and

Il are Union members. con

In theory at least, in addition to structuring the daily

hiring priorities, the Group system also represents the

priority list for filling Regular Situations as they may become

vacant in the newspapers shops.

The Union was founded in 1901, long before the

present Group structured contract was in existence. There

is no evidence to indicate that at that time it had any

minority members (as that term is defined today).

Historically it virtually limited membership to the first born

legitimate son of a member. The industry had a closed shop

and Union members were consistently hired before non-

Union men at all industry shapes. In 1952, the industry

adopted the contract which included the rudiments of the

Group structure described above.

It is abundantly clear that the nepotistic policy of the

Union prior to 1952 resulted in discrimination against

minorities. See, e.g., Rios v. Enterprise Association Steamfitters

Local 638, supra, 501 F.2d 622. United States v. Wood Wire

and Metal Lathers International Union, 328 F. Supp. 429, 432

(S.D.N.Y. 1971). The fact that the Union’s intent was not to

discriminate against minorities, but to prefer Union members

and their sons, does not change the basic conclusion. The

effect of such policies, deliberate or not, was to foreclose

minorities from employment in the industry. It is the

discriminatory effect of practices and policies, not the

underlying intent, which is relevant in a Title VII action.

The Group structure, instituted in 1952, appears on

21a

its face to discard these discriminatory policies and to open

up regular employment opportunities and Union membership

to the entire labor force. But, there is uncontroverted

evidence that certain relevant provisions of the contract have

been administered haphazardly, and that the Group structure

has been circumvented by friends and family of Union

members. In practice, the fact is that no non-Union Group

III shaper in the industry has achieved a Regular Situation,

and thus Union membership, by moving up the Group

system since 1963.

Testifying at trial, the Union president credibly

asserted that the Union was not motivated by any intent to

discriminate against minorities, but went on to say that, "I

would be the first to admit that we favor and we are partial

to our members and I’m not ashamed of that." This attitude

is, of course, admirable under most circumstances. There

would be nothing unlawful about its effect under Title VII

providing that minorities, historically, had been provided free

and equal access to Union membership. But the facts

indicate that such is not the case here. And even without

evidence of abuse of the Group system, the statistics alone

reveal the present situation.

There are presently some 4,200 members of the

Union, including some 900 pensioners. More than 99% of

these Union members are White (non-minority).

There are, at present, a total of 2,855 persons actively

working in the industry -- this includes Regular Situation

holders (2,460), Group I members (123), and Group III

members (272).? Of the total in these categories, 70 persons

-- 2% are Black, Spanish-surnamed, Oriental or American

Indian. Of the 70 minority persons, 28 are scattered among

Group II is not counted here because Group II is constituted of

persons who also hold Regular Situations or Group I positions _in

the industry. They are permitted by contract to shape in any shop

other than their own, in addition to their regular job.

22a

the smaller publishers and distributors; 24 work at the News

where the force is approximately 900; work at the Times

where the force is approximately 400; and 1 works at the

Post where the force is approximately 318.

These figures demonstrate that 20 years after the

industry instituted a neutral Group structure of employment

and hiring priorities, the participation of minorities in this

industry is still grossly disproportionate to the percentage of

minority workers in the relevant labor force, which the

EEOC suggests is approximately 30%.’ Even allowing for

the fact that the industry has seen many newspapers

disappear in these last two decades, with a concomitant loss

of jobs, the clear inference from these statistics is that abuses

of the Group structure and indeed the Group structure itself,

is serving -- however unintentionally -- to "lock in" minorities

at the non-Union entry level of the industry, and to thereby

perpetuate the impact of past discrimination on the

minorities with whom these Title VII actions ar concerned.

It is this present impact of past practices which justifies the

affirmative corrective relief embodied in the Settlement

Agreement. See, Griggs v. Duke Power Co., 401 U.S 424, 91

S.Ct. 849, 28 L.Ed.2d 158 (1971); Rios v. Enterprise

Association Steamfitters Local 636, supra, United States v.

Wood, Wire and Metal Lathers International Union, supra;

United States v. Bethlehem Steel Corp., 446 F.2d 652 (2d Cir.

1971).

The Terms of the Agreement

As with many resolutions of employment

discrimination cases, the Settlement Agreement in these

actions contains general provisions permanently enjoining the

defendants from discriminatory practices in violation of Title

VII. And, like the judgment in Rios, 360 F. Supp. 979

(S.D.N.Y. 1973) and the agreement in Wood, Wire (68 Civ.

*See p. 593 [pp. 28a-29a of this Appendix].

23a

2116, S.D.N.Y. Feb. 25, 1970), this Settlement Agreement

sets forth a minority employment goal. In this case, it is for

25% minority employment in the industry within five years.‘

But, unlike Rios and Wood, Wire, this Settlement Agreement

does not merely commit the parties to the future

development of a plan to achieve that goal. Instead, it sets

forth a plan with great specificity, including variations on the

general theme to account for varying circumstances between

different employers. Such detail indicates that the plan is

the result of hard, serious and good faith negotiations, and

that the different pressures, perspectives and interests of the

parties have been confronted and already resolved. This

serves to increase the Court’s confidence that the plan is

workable, and can be implemented imn:cdiately.

The plan is built upon the outline of the present

Group priority structure of the collective bargaining

agreement. It provides for an administrator whose duties

include not only close supervision of the plan, but also of

employment opportunities in the industry on behalf of all

workers. Its major features include elimination of past

abuses of the Group system; elimination of the contract

provision which restricted Group I to former Regular

Situation holders; provision for an orderly flow of Group III

shapers -- alternating one minority person with one non-

minority person -- into steady and secure employment in the

industry, first as members of Group I and from there, as

Regular Situations become vacant, to Regular Situations.

Union membership will be offered to each Group III worker

as he reaches the bottom of Group I. The plan further

provides that until the 25% minority employment goal is

achieved, employers shall hire, at the entry level, three

“The parties have defined "employment" as encompassing Regular

Situations and Group I positions. Their view is that a place in either

of these two groups represents a steady, secure job in the industry.

The Court agrees, at this time. The definition is subject to revision

by terms of the Settlement Agreement.

24a

minority persons for every two non-minority persons. In

addition, minorities who are presently active on Group III at

the News and the Times will immediately move to the

bottom of the Group I list, with an equal number of non-

minorities to immediately follow them into the Group I list.

These minorities will be given pension benefits they would

have earned but for the disadvantages they have

encountered. With the same purpose, funds have been

established by the defendants to provide back pay awards

chiefly to these persons.

The Intervenors’ Objections

The Group III list the News numbers 178. Scattered

throughout the list, in terms of tenure, are 13 minority

persons. the intervenors purport to speak for the other 165

persons on the list, and more broadly for all non-minority,

non-Union workers in the industry.

Most of the provisions of the Settlement Agreement

are applauded by the intervenors, as well they might be. By

regulating employment opportunities in the industry,

unlocking Group III and Group I, Regular Situations and

Union membership, the Agreement will operate beneficially

for the intervenors as well as for the minorities.

The focus of their objection is on the order of the

flow from Group III to Group I. They assert that the flow

ought to be in strict order of tenure on Group III. To

immediately move all of the present Group III minorities to

the Group I list ahead of some non-minorities who have

been listed for a longer period of time on Group III, they

assert, is to engage in "leap-frogging” not intended by Title

VII. Further, they argue, that the system becomes even

more onerous when the provisions for alternating minority

/non-minority elevation to Group I go into effect, because

after the few minorities who have any tenure in the shop are

moved to Group I, the employer will be required to move

minorities with no tenure at all ahead of some present

25a

Group III non-minorities.

The facts selected by the intervenors in support of

their objections are so. And, at first glance their frustration

and anger with this Settlement Agreement is understandable,

and their solution is appealing. These intervenors from

Group III, as individuals, have also suffered the effects of

the Union’s nepotism; they have also attacked the present

practices and abuses in other forums, under different

Statutes. Certainly this Court does not accept the argument

that these particular men have benefited from a

discriminatory system.

But, on deeper examination of the Settlement

Agreement and the intervenors’ objections, there are a

number of reasons why this Court does not and indeed can

not, view the intervenors as raising countervailing

considerations of such a substantial nature as to preclude

approval of the plan.

First and dispositive of all the issues raised by the

intervenors, the Settlement. Agreement simply does not

trample on their employment opportunities. In the long run,

it must be acknowledged by all concerned that the effect of

this Agreement, if it operates as predicted, will be to achieve

Regular Situation or Group I status for all members of

Group III, minority and non-minority alike, within a

relatively short time-span. Without this Settlement, Group

III workers had little if any hope of ever achieving either

Status under the present system. The intervenors do not

contend otherwise. Instead, their objections deal in the main

with interim measures which do, in fact, move some

minorities faster than some non-minorities. But it must be

noted that once a Group III non-minority is elevated to

Group I, his daily shaping opportunities will be no less than

they presently are and indeed they may be greater. The

News projections submitted to this Court indicate that within

a month after implementation of the plan, the non-minority

who is number 47 on the Group III list, and all non-

26a .

Minorities above him, will have been elevated to Group I.

The progression thereafter is expected to be approximately

27 non-minority persons to Group I each year. Also the

Settlement Agreement provides other benefits to Group III

non-minorities, not the least of which is the appointment of

an administrator who is empowered to assure that existing

work opportunities in the industry shall be made available to

any Group III person unable to get at least 45 shifts of work

in any calendar quarter.

Further, even if the Settkement Agreement did not

provide non-minorities with these benefits, the intervenors’

position is not factually or legally sound. Their premise is

that the Settlkement Agreement will oust them from what

they perceive as vested seniority rights in their Group III

order. If, in fact, this Settlement Agreement affected firm

and realistic seniority rights and expectation of innocent non-

minority workers, there could be doubts as to the validity of

the relief afforded. See e.g., United States v. Bethlehem Steel

Corp., 446 F.2d at 661. But in this case, regardless of the

priority structure of the present contract, and the language

which may be used in it the fact remains that Group III

workers do not have full-time employment, nor do many of

them have any great expectations or intention of working

full-time while they shape from the Group III list. They are

shapers. And, to the extent that the present contract

structure, in theory, gives them certain priorities, by tenure

on Group III, to achieve Regular Situations, the facts have

demonstrated that they could not have any realistic

expectation of such movement actually occurring. As noted

above, no Group III worker has moved up the list to a

Regular Situation since 1963.

Their expectations with respect to daily shape

priorities must be viewed in a somewhat different light.

Then an additional person is placed in front of a shaper,

theoretically his chances of working any particular shift are

decreased by a factor of one job. This, of course, depends

on the stability of the total number of jobs available from

ST

27a

shift to shift and whether or not the new person chooses to

shape the same shift. In other words, assessing a shaper’s

expectation is a highly speculative exercise. The Court does

not mean to minimize a Group III member’s vested

emotional interest in his position at a shape, but it cannot be

equated with the worker who might be “bumped” from a

steady and seemingly secure position by an outside minority

with less seniority than him. Further, it must be pointed out

that even if these shaping priorities were viewed as providing

firm expectations, "[such] seniority advantages are not

indefeasibly vested rights but mere expectations derived from

a bargaining agreement subject to modification." United

States v. Bethlehem Steel Corp, supra, 446 F.2d at 663.

Indeed, the intervenors themselves recognize this principle

when they approve of many changes made in the collective

bargaining agreement by the proposed Settlement.

Also, it must be said that the relief the intervenors

suggest, which would observe strict tenure of the Group III

list, would most likely not provide the relief mandated by

Title VII for minorities. Given the fact that the active work

force at the News numbers 900 and includes only 24 minority

persons, it would clearly take a far longer period of time to

reach a goa! of 25% minority employment. Because the

minority percentage is so low, the same objection holds true

if, as the intervenors have suggested, the Group I and Group

III lists were dovetailed by shop tenure.

Finally, it must not be forgotten that this is a Title

VII case. Such cases, as Judge Frankel has said in Wood,

Wire are launched by statutory commands, rooted in deep

constitutional purposes, to attack the scourge of racial

discrimination in employment. . . . [a]Jnd we know that, in

addition to the spiritual wounds it inflicts, such

discrimination has caused manifold economic injuries,

including drastically higher rates of unemployment and

privation among racial minority groups." United States v.

Wood, Wire and Metal Lathers International Union, Local

Union 46, 341 F. Supp. 694, 699 (S.D.N.Y. 1972). Title VII

28a

is an expression of a commitment to correct minority

employment discrimination and, hopefully, the vast social

consequences that flow from it and afflict the whole of the

nation. The statute does not undertake to correct all forms

of employment discrimination. Thus, to the extent that what

the intervenors seek here is relief equal to that afforded

minorities, it has no legal foundation, in this case. Under

the law, relief here must be limited to victims of the kind of

discrimination prohibited by Title VII. United States v.

Bethlehem Steel Corp., supra, 446 F.2d at 665. There is no

evidence and no assertion that the intervenors have been

discriminated against on account of race, religion, color, sex,

national origin, or because they have made charges, testified,

assisted or participated in any enforcement proceedings

under Title VII.

The 25% Minority employment Goal

There remains the requirement of Rios v. Enterprise

Association Steamfitters Local 638, supra, 502 F.2d 622, for

reliable factual support for the 25% goal. All of the parties

have agreed to the figure. The EEOC has based its

conclusion on relevant labor force statistics contained in the

tables published by the United States Department of

Commerce in a publication entitled General Social and

Economic Characteristics, 1970 Census of Population, for the

relevant geographic areas of the Union’s jurisdiction. Using

what this Court agrees is the most reliable profile possible of

the candidate for deliverers’ work, the EEOC has extracted

figures for Black males over 16 years of age with a high

school diploma or less. With considerable ingenuity, the

agency has also extrapolated comparable figures for

minorities other than Black. Added together they indicate

that the relevant labor force is 30% minority. Although the

private plaintiffs and the intervenors have submitted other

calculations and bases with respect to minority

representation in the relevant labor force, in this Court’s

view the EEOC analysis is the soundest and provides ample

support for the 25% minority goal included in the Settlement

29a

Agreement.

Conclusion

This Court has found that the affirmative relief

provided in the Settlement Agreement is justified by the

facts of this case. It has found that the 25% minority goal

is supported by reliable statistics. It has found that the

affirmative relief provides members of the plaintiffs’ class

and other minorities with an adequate, fair and reasonable

route to their "rightful place” in this industry and that the

Settlement Agreement is enforceable, legal and in the public

interest. The Court has also found that the Settlement

Agreement does not so interfere with the rights of the

intervenors as to require disapproval.

Therefore, the motion of the parties for approval of

the Settlement Agreement is hereby granted. Settle Order,

upon the consent of the parties endorsed thereon by their

attomeys, accordingly.

So ordered.

SUPPLEMENTAL OPINION and ORDER

On September 19, 1974, this Court filed a

Memorandum Opinion and Order approving the proposed

settlement of these actions. As part of that settlement the

parties agreed to the appointment of an Administrator to

supervise its implementation. While they agreed that the

Court would appoint a person of its own choosing, they

indicated a preference for a particular individual whose

reputation as an experienced person in labor-management

relations is undisputed.

This Court is mindful that given the context of a suit

pursuant to Title VII of the Civil Rights Act of 1964

experience in labor-management relations is not without

significant value to an Administrator. But this is not to say

that under all circumstances an Administrator in a Title VII

action must be recruited from the ranks of the labor-

30a

management specialists. There are instances, and the Court

believes this to be one of them, when other qualities may

assume greater importance in meeting the commitment to

the broad social policies which underpin the 1964 Act.

The Administrator appointed in these consolidated

actions will be charged with the responsibility of seeing that

the terms of the Settlement Agreement under Title VII of

the Civil Rights Act of 1964 are diligently and

conscientiously implemented. This Act was designed

primarily to protect, and provide a more effective means to

enforce, the civil rights of persons within the jurisdiction of

the United States. It aims, inter alia, to eliminate

discriminatory practices by business, labor unions, or

employment agencies and thereby to encourage the growth

of economic opportunities for minority individuals, thus

strengthening the economic foundation essential to the full

enjoyment of civil rights. When President Lyndon B.

Johnson signed the 1964 Act he declared that its overriding

social goal was "to promote a more abiding commitment to

freedom, a more constant pursuit of justice and a deeper

respect for human dignity."

In light of these broad national purposes, this Court

considers it of paramount importance that the Administrator

it appoints here possess a finely tuned sensitivity to the social

impact of past discriminatory employment practices, and a

balanced sense of dedication and commitment to the

elimination of these practices.

Further, while in some cases the very nature of the

industry in which the Settlement Agreement is to operate

and the unusual complexity of its labor-management

problems may dictate the appointment of an individual with

a background in labor-management relations, such is not the

case here. Here, the Court is concerned with an important

but relatively small and centralized industry involving the

delivery of newspapers, magazines, books, etc. The

bargaining unit of the Newspaper and Mail Deliverers’

3la

Union encompasses only about 3,000 employees most of

whom are employed by the three major newspapers in the

New York City metropolitan area. Given these

characteristics, this Court finds that experience in labor-

management relations need not be the major consideration

which should guide the Court in its appointment of an

Administrator.

This finding is buttressed by the fact that the

Settlement Agreement here is quite detailed and specific.

Were such an Agreement broad in its terms, the

Administrator would be faced with the need to establish

procedures, define specific objectives, and develop the

methods to be employed. In such an instance, an

Administrator with an extensive background in_labor-

management work and possibly even familiarity with the

industrial unit involved would seem to be indicated. In

contrast where the Settlement Agreement is highly detailed,

as here, the responsibilities of the Administrator are clearly

defined and consequently, his discretion is accordingly more

circumscribed and the need for a particular expertise

becomes correspondingly less important.

Not to be disregarded, of course, in appointing an

Administrator is the assessment of the proposed

Administrator by the parties. Since their respective interests

clearly will be affected by the Court-appointed Settlement

Agreement, there should be some assurance that there is

confidence in the person to be appointed. In this case, the

proposed Administrator is said to be completely satisfactory

both to the private plaintiffs and to the EEOC. While it is

true that the defendants have not expressed like sentiments,

their reservations are centered on the _ proposed

Administrator’s lack of experience in labor-management

relations. But, as the Court has already indicated, such

experience while frequently desirable and even essential

should not always be the prevailing consideration. Sensitivity

to the broad social purposes of civil rights legislation and the

disposition to fairly and adequately administer the agreement

32a

are qualities which in this Court's view, in this case outweigh

whatever lack of expertise may exist. Further, the parties

herein have demonstrated a commendable spirit of

cooperation which the Court confidently expects will

continue during the implementation state of these

proceedings. To that extent the Administrator’s task will be

made immeasurably less difficult.

Having carefully considered the matter in light of the

principles briefly discussed above and after a careful review

of a number of qualified men and women who might be

available for appointment, the court has decided to appoint

the person named in the Court’s letter of September 11,

1974 as the Administrator.

It is so ordered.

33a

No 73 Civ. 3058

No. 73 Civ. 4278

Filed October 25, 1974

United States District Court

Southern District of New York

JOHN R. PATTERSON, et al.,

Plaintiffs,

Vv.

NEWSPAPER & MAIL DELIVERERS’ UNION OF

NEW YORK AND VICINITY, et. al,

Defendants.

EQUAL EMPLOYMENT OPPORTUNITY

COMMISSION

Plaintiff,

Vv.

NEWSPAPER AND MAIL DELIVERERS’ UNION OF

NEW YORK AND VICINITY, et al,

Defendants.

JAMES LARKIN, DOMINICK VENTRE, FRANK

CHILLEMI, GERALD KATZ, et al,

INTER VENORS.

Ee

34a

FINAL ORDER AND JUDGMENT

Upon the consent of the parties, endorsed hereon by

their attorneys, and upon the Settlement Agreement between

the parties, dated June 27, 1974, and attached hereto as

Exhibit A, and upon this Court’s Memorandum Opinion and

Order approving the Settlement Agreement, dated

September 19, 1974, and upon this Court’s Supplemental

Opinion and Order, dated October 11, 1974, appointing

William S. Ellis, Esq., as the Administrator, it is hereby

ORDERED, ADJUDGED AND DECREED:

Be The Settlement Agreement is hereby approved

as a basis for settlement of these actions and the defendants

in these actions, including those in default, are hereby

directed to implement and perform the Settlement

Agreement in accordance with its terms and with the

provision of this Order and Judgment.

2. Failure to comply with this Order and

Judgment, including breach of the Settlement Agreement,

shall be punishable as a contempt of court.

3. A copy of the Settlement Agreement and of

this Order and Judgment shall be kept available and

displayed by all defendant employers in a permanent place

where notices to their delivery department employees are

usually posted and by defendant union in a prominent piace

at the union’s offices.

4, This Order and Judgment and the Settlement

Agreement shall be binding upon plaintiffs and all members

of the class or classes they represent, and defendants and

their officers, agents, servants, employees, assigns, and upon

those persons in active concert or participation with them

who receive actual notice of the order by personal service or

otherwise.

S.: William S. Ellis, Esq., is hereby appointed as

the Administrator under the Settlement Agreement, and he

35a

shall be compensated at an hourly rate of $65.00 plus

expenses.

6. This Court’s temporary ,restraining order of

March 19, 1974, extended by consent of the parties on April

5, 1974, until the entry of this final order, is dissolved as of

the effective date of this Final Order and Judgment.

7. These actions are hereby marked "settled,"

with prejudice and the Court hereby retains continuing

jurisdiction over these actions for the purpose of the

enforcement of compliance with this Order and Judgment

and the Settlement Agreement and the punishment of

violations thereof, and for the purpose of enabling any of the

parties to apply to the court for such further orders and

directions as may be necessary or appropriate.

8. This Order and Judgment shall take effect on

November 11, 1974, and any application to the United States

District Court for a stay thereof shall be made in writing and

not later than October 29, 1974, at 10:00 O’clock a.m.

Dated: New York, New York

October 24, 1974.

United States District Judge

36a

No. 626

Docket No. 74-2548

Argued Jan. 9, 1975

Decided March 20, 1975

United States Court of Appeals

Second Circuit

JOHN R. PATTERSON, et al.,

Plaintiffs,

V.

NEWSPAPER AND MAIL DELIVERERS’ UNION OF

NEW YORK & VICINITY, et. a/.,

Defendants-Appellees,

EQUAL EMPLOYMENT OPPORTUNITY

COMMISSION,

Plaintiffs,

v.

NEWSPAPER AND MAIL DELIVERERS’ UNION OF

NEW YORK AND VICINITY, et ai.,

Defendants-Appellees

DOMINICK VENTRE, et ai.,

Intervenors.

37a

Before: FEINBERG, MANSFIELD and OAKES,

Circuit Judges

MANSFIELD, Circuit Judge:

At issue on this appeal is the appropriateness of relief

against discrimination in the employment of news deliverers.

In the past we have been called upon to review relief granted

in cases where discrimination has been established under

Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000

et seq., including the use of minority percentage goals and

affirmative hiring and promotion programs. See, e.g., Rios v.

Enterprise Assn. Steamfitters, Local 638, 501 F.2d 622 (2d Cir.

1974); Bridgeport Guardians, Inc. v. Bridgeport Civil Serv.

Comm., 482 F.2d 1333 (2d Cir. 1973); United States v.

Bethlehem Steel Corp., 446 F.2d 652 (2d Cir. 1971). The

present appeal presents several variations on the theme.

Unlike previous cases the affirmative relief under attack here

does not result from an order of the district court entered

after a determination of the merits of the action but from a

settlement agreement between the plaintiffs, who are

minority persons seeking employment as news deliverers, the

defendant Newspaper and Mail Deliverers of New York and

Vicinity ("the Union" herein), and the Government. The

settlement was reached after a four-week trial in the

Southern District of New York before Lawrence W. Pierce,

Judge, who approved the agreement. The person challenging

the relief is not an aggrieved minority employee but a white

non-union worker, James V. Larkin, who, having been

permitted to intervene, seeks to set aside the agreement as

unlawful on the ground that it affords benefits to minority

38a

workers' not given to similarly situated white workers,

regarding the advancement rate and diluting the work

opportunities of these white workers.

Because he had heard a four-week trial in this case

and because of the public interest involved in a Title VII

action. Judge Pierce considered in a thorough opinion the

merits of the plaintiffs’ action and the conformity of the

settlement to the goals of Title VII and the rights of the

parties. See, 384 F.Supp. 585 (S.D.N.Y. 1974). We find no

abuse of discretion in Judge Pierce’s approval of the

settlement and therefore affirm.

The appeal arises out of the two consolidated actions.

One was brought by the Equal Employment Opportunity

Commission against the Union, the New York Times

("Times" herein), the New York Daily News ("News" herein),

the New York Post ("Post" herein), and about 50 other news

distributors and publishers within the Union’s jurisdiction.

The other is a private class action on behalf of minority

persons. Both complaints allege historic discrimination by

the Union against minorities, and charge that the present

structure of the Union’s collective bargaining agreement and

the manner of its administration by the Union perpetuate

the effects of past discrimination in a manner that violated

Title VII. The defendant publishers are alleged to have

acquiesced in these practices. Appellant Larkin is one of

approximately 100 white non-union "Group III" workers at

the News who are given permission to intervene under F.R.

Civ. P. 24(a)(2) because of their potential interest in the

relief to be fashioned.

The Union is the exclusive bargaining agent for the

collective bargaining unit which embraced all workers in the

delivery departments of newspaper publishers and of

‘The term “minority” as used herein means persons who are Black,

Spanish-surnamed, Oriental and American Indian. "White" or "non-

minority” refers to all other persons.

—— oo rn

—— ee

39a

publications distributors in the general vicinity of New York

City, including, in addition to the city proper, all of Long

Island, northeastern New Jersey counties, and north to

Fairfield County, Connecticut. Of 4,200 current Union

members, 995 are white.

Due to variations in the size and quantity of

publications to be distributed, the needs of distributors for

delivery personnel vary from day to day and from shift to

shift. For that reason the work force in the industry is

separated by the Union agreement into (1) those holding

permanently assigned jobs ("Regular Situations") and (2)

those called "shapers," who show up each day to do whatever

extra work may be required on that day. The work

performed by persons in both categories is unskilled.

Shapers are divided into four classifications, Group I-IV. the

order in which shapers are chosen for extra work on each

shift is determined according to Group number and by shop

seniority of members within each group.

Group I, the highest priority group, consists solely of

persons who once held Regular Situations in the industry.

Each employer maintains his own Group I list, which is

comprised of persons who have been laid off from Regular

Situations at other employers, or who have voluntarily

transferred from Regular Situations or from classifications as

Group I shapers at another employer. When a Regular

Situation becomes available, the highest seniority person on

the employer’s Group I list is offered the position.

Group II is an aggregate list compiled from the entire

industry and consists of all Regular Situation holders and

Group I members. Taking priority after Group I is

exhausted, it enable regular and Group I members to obtain

extra daily work at employers other than their own.

Major employers maintain a Group III list, which

consists of persons who have never held a Regular Situation

in the industry. Members of Group III are given daily work

40a

priority after Group II. To maintain Group III status,

workers are required to report for a certain number of

"shapes" each week. Prior to the settlement agreement

under review Group III members are theoretically entitled

by shop seniority to any Regular Situation that become

available, if the Group I list had been exhausted. Group IV

shapers are last in priority and are required to appear for a

shape far less frequently than Group III shapers.

Although the Union represents all delivery workers,

membership is limited to Regular Situation holders and

Group I members. Historically the Union has excluded

minorities and has limited its membership to the first born

son of a member. Aside from the chilling effect which

restriction of Union membership to whites might in itself

have upon minority persons seeking delivery work, there is

evidence that minorities were also discouraged from gaining

entrance to Group III lists, even though Group III shapers

are not members of the Union. Of 2,855 persons now

actively seeking work in the industry (which includes 2,460

Regular Situation holders, 123 Group I shapers, and 273

Group III shapers only 70, or 2.45%, are minority persons.

While the current Group Situation which was adopted

in 1952 appears on its face to open Union membership to

anyone in the labor force, Union membership, because of lax

administration of the contract provisions, has largely

remained attainable only by the family and friends of a

Union member. Due to artificial inflation of the Group I

lists, no person has in practice made the theoretically

possible jump from Group III to a Regular Situation since

1963. The evidence suggests that this expansion of the

Group I lists has been accomplished primarily by use of

voluntary transfers of Group I or Regular Situation holders

from the lists of smaller distributors to the Group I lists of

more desirable, larger employers, and ultimately to Regular

Situations there. Other devices include fictitious lay-offs,

enabling the Union member to transfer to Group I of the

different employer, and outright false assertion of Group I

ee Se SU le a tena >

4la

status by persons who have obtained Union membership

cards, the validity of which have not been challenged by

employers.

On the basis of this evidence, which was largely

uncontroverted, Judge Pierce, in approving the settlement,

had no difficulty concluding that the Union’s practice

amounted to a violation of Title VII, since they served to

"lock-in’ minorities at the non-union level of entry in the

industry, and thereby to perpetuate the impact of past

discrimination . . . .," conclusions that appear fully justified

by the record and are not challenged here. See, Griggs v.

Duke Power Co., 401 U.S. 424, 91 S.Ct. 849, 28 L.Ed.2d 158

(1971); Rios v. Enterprise Assn. Steamfitters, Local 638, supra;

United States v. Wood, Wire & Lathers, Intl. Union, Local No.

46, 471 E.2d 406 (2d Cir.), cert. denied, 412 U.S. 939, 93 S.Ct.

2773, 37 L.Ed.2d 398 (1973); United States v. Bethlehem Steel

Corp., supra.

The settlement agreement reached by the parties

provides that the Union shall be permanently enjoined from

discriminatory practices in violation of Title VII. It

establishes an administrator to insure compliance with the

terms of the agreement, and provides for the elimination of

past abuses, primarily by abolishing voluntary transfer by

Union members. It establishes a minority hiring goal of

25%, specifies a procedure for attaining that goal, and

provides for back pay to minority workers. Most of these

provisions are not challenged by Larkin.

The 25% goal is to be reached throughout most of

the industry by requiring that all incumbent minority persons

on the Group III list of each employer as of the date of

entry of the order are to be moved immediately to group I.

All new persons hired in the industry and classified in Group

III will be employed according to a ratio of three (3)

42a

minority’ persons to two (2) non-minority persons. As each

Regular Situation is filled by a Group I member, one Group

III member shall be moved to Group I and offered Union

membership. This is to be done on an alternating one-for-

one basis between minority and non-minority workers. Each

two vacancies in Group I will thus be filled by the minority

worker in Group III having highest seniority and the highest

seniority non-minority worker. The agreement also modifies

these provisions insofar as they apply to the smaller

employers and to the Daily News, taking into account special

conditions affecting each. At the News, an equal number of

non-minority persons from Group III will follow those

minority workers who move into the Group I list on the date

of the order, also, for a certain time, one minority and one

non-minority person will replace each person on the Group

I list promoted to the Regular Situation.

Larkin’s objection to the settlement is premised on

the observation that Group III white workers have not

benefited from the Union discrimination which is the object

of this lawsuit. On the contrary, as Judge Pierce recognized,

they also have suffered from Union policies which barred

Group III workers from access to Group I and permanent

jobs. Upon this premise. Larkin first broadly asserts that

because the Group III whites were also discriminated

against, they are entitled to the same relief as the minority

workers. More specifically, he objects to those aspects of the

affirmative action plan which, he asserts, allow minorities to

"leap-frog" non-minorities with greater seniority. He also

*Intervenor in addition, suggests procedural infirmities in the

court’s approval of a plan to which he objected. It is difficult to think

of a way in which appellant was denied procedural rights however,

since Judge Pierce afforded him a hearing and thoroughly considered

his objections.

BAe

43a

attacks the 25% goal.’

DISCUSSION

The scope of our review of a district court’s approval

of a settlement agreement is limited. "[T]he appellate court

should intervene only on a clear showing that the trial judge

was guilty of an abuse of discretion,” State of West Virginia v.

Chas. Pfizer & Co., 440 F.2d 1079 (2d Cir.), cert. denied, 404

U.S. 871, 92 S.Ct. 81, 30 L.Ed.2d 115 (1971). While the

public objective embodied in Title VII warrant a careful

review of the provisions of the settlement in light of those

policies, see, Rios v. Enterprise Assn. Steamfitters, Local 638,

501 F.2d 622, 628 n.4 (2d Cir. 1974), the clear policy in favor

of encouraging settlements must also be taken into account,

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

571 (Sth Cir. 1960), particularly in an area where voluntary

compliance by the parties over an extended period will

contribute significantly toward ultimate achievement of

Statutory goals. Nor should we substitute our ideas of

faimess for those of the district judge in the absence of

evidence that he acted arbitrarily or failed to satisfy himself

that the settlement agreement was equitable to all persons

concerned and in the public interest, cf. United States v.

Wood, Wire & Metal Lathers Intl. Union, Local No. 46, 471

F.2d 408, 416 (2d Cir.), cert. denied, 412 U.S. 939, 93 S.Ct.

2773, 37 L.Ed.2d 398 (1973), especially in a case like the

present one where the settlement was approved and two

hearings with respect to the fairness and adequacy of the

proposed agreement. Furthermore, unlike appeals from

decrees of the district court entered after trial on the basis

of findings and conclusions where we may modify the terms

‘Intervenor, in addition, suggests procedural infirmities on the

Court’s approval of a plan to which he objected. It is difficult to think

of a way in which appellant was denied procedural rights however,

since Judge Pierce afforded him a hearing, and thoroughly considered

his objections.

44a

of the decree, see, e.g., United States v. Bethlehem Steel Corp.,

supra, we are powerless to rewrite the provisions of the

settlement agreement. Our only alternative, if we concluded

that Judge Pierce had abused his discretion, would be to set

aside his approval of the settlement and remand the case for

completion of the trial. United States v. Automobile

Manufacturers Assn., 307 F. Supp. 617 (C.D. Calif.), affd, per

curiam sub nom., City of New York v. United States, 397 U.S.

246, 90 S.Ct. 1105, 25 L.Ed.2d 280 (1970).

Although Larkin objects to the use of a 25% goal and

to Judge Pierce’s conclusion that the minority make-up of

the relevant part of the labor force is 30%, he does not

suggest any alternative or more reliable figures as to the

labor force, he merely calls the court’s figures "contrived."

In contrast to his failure to provide any evidentiary support

for his objections, the record reveals that, in concluding that

the 25% goal was appropriate, Judge Pierce relied on

population figures in the Department of Commerce’s

publications, General Population Characteristics -- 1970

Census of Population and General Social and Economic

Characteristics, 1970 Census of Population and took into

account the relevant geographic area and demographic

characteristics of those making up the news delivery work

force. Thus, his conclusion, laid down in Rios v. Enterprise

Assn. Steamfitters, Local 638, 501 F.2d 622 (2d Cir. 1974),

was adequately based.*

“Intervenor also suggests that his rights under 42 U.S.C. § 2000e-

2(j) have been violated. The section provides in pertineat part.

"Nothing contained in this subchapter shall

be interpreted to require any employer, employment

agency, labor organization, or joint labor-

management committee subject to this subchapter to

grant preferential treatment to any individual or to

any group because of race color, religion, sex, or

(continued...)

{i

ee” Cite Se

45a

Larkin’s argument that he is entitled to the same

benefits as the minority workers must also be rejected. This

case arises under a statute which by its terms is limited to

protection against employment discrimination based on an

individual’s race, color, religion, sex, or national origin.” 42

U.S.C. § 2000e-2(a)(1). Larkin does not allege

discrimination against him based on any of these factors. He

argued only that the industry’s part practices discriminated

against all Group III members, minority and non-minority,

and that while the settlement agreement remedies the

discrimination against minority persons it fails to afford any

relief for the harm caused to non-minority persons. Worse

still, he asserts, the relief to minority persons is at the

expense of the white Group III workers.

At first glance this argument has much appeal. As

the district court recognized, Group III workers were the

victims of some practices that were harmful to all Group III

*(...continued)

national origin of such individual or group o account

of an imbalance which may exist with respect to the

total number of percentage of persons of any race,

color, religion, sex, or national origin employed by

any employer, referred or classified for employment

by any employment agency or labor organization

admitted to membership or classified by any labor

organization, or admitted to, or employed in any

apprenticeship or other training program, in

comparison with the total number or percentage of

persons of such race, color, religion, sex, or national

origin in any community, State, section, or other

area, or in the available work force in any

community, State, section or other area.”

It is well settled in this Circuit that this section does not preclude the

use of racial hiring quotas to remedy the effects of past discrimination.

Rios v. Enterprise Assn. Steamfitiers, Local 638, supra, 501 F.2d at 630-

31; Vulean Society v. Civil Serv. Comm., 490 F.2d 367 (2d Cir. 1973);

United States v. Wood, Wire & Metal Lathers, supra.

46a

members, regardless of race. Minority members, on the

other hand, were the targets of racial discrimination on the

part of the virtually all-white Union. In this Title VII action

we are limited to consideration of the fairness of relief

directed only to the latter. The objective of Title VII is to

"attack the scourge of racial discrimination" which has

“caused manifold economic injuries, including drastically

higher rates of unemployment and privation among racial

minority groups." United States v. Wood, Wire & Metal

Lathers Intl. Union, 341 F. Supp. 694, 699 (S.D.N.Y. 1972),

affd. 471 F.2d 408 (2d Cir.), cert. denied, 412 U.S. 939, 93

S.Ct. 2773, 37 L.Ed.2d 398 (1973). It creates no rights or

benefits in favor of non-minority persons or groups. Any

past denial of promotion rights to Larkin is clearly not

remediable under Title VII. Indeed, Group III white

workers have unsuccessfully sought relief for themselves

under other statutes. It is thus apparent that Larkin has no

right to any of the affirmative relief afforded to the minority

groups, including the back pay provisions.* Our review,

therefore, must be limited to the question of whether the

settlement agreement, in remedying minority discrimination,

treats the intervenors fairly. See State of West Virginia v.

Chas. Pfizer & Co., 440 F.2d 1079 (2d Cir.), cert. denied, 401

U.S. 871, 92 S.Ct. 81, 30 L.-Ed.2d 115 (1971).

The affirmative-action provisions of the agreement

under review affect Group III workers in the industry, and

particularly Daily News workers, in two ways. First, the

provisions for immediate transfer of incumbent minorities at

‘United States v. Roadway Express, Inc., 457 F.2d 654 (6th Cir.

1972) relied on by the intervenor does not suggest otherwise. There

the court was faced with a settlement agreement in which the union

had agreed to give some benefits to white as well as minority non-

union workers. When white union members objected the court

refused to invalidate the agreement. The case does not require that

a settlement give equivalent benefits to minority and non-minority

workers.

47a

major employers to Group I and for the filing of Group I

openings by alternately promoting one minority worker and

then one non-minority worker from Group III to Group I

mean that a white Group III worker will advance to Group

I less rapidly than would be possible if straight shop seniority

were the basis of promotion. Indeed, a time will shortly

come when minority persons not employed in the industry at

all on the date when the agreement went into effect may

achieve Group I status before many Group III whites with

seniority. Although this feature of the agreement is not as

beneficial to Larkin as would be promotion on the basis of

Straight non-minority regardless of race, the agreement

nevertheless benefits Larkin. It presents him with an

opportunity he never had before: the chance to move up to

Group I, and eventually to a Regular Situation. Before,

there was in effect no seniority system with respect to

promotion into Group I. Thus any plan for advancement of

Group III members to Group I could only be beneficial to

Larkin. Approval of the plan can hardly be labelled as abuse

of discretion because it does not advance Larkin as rapidly

aS minority persons with less seniority. A reasonable

preference in favor of minority persons in order to remedy

past discrimination injustices is permissible. See Rios v.

Enterprise Assn. Steamfitters, 501 F.2d 622 (2d Cir. 1974).

Second, the agreement affects daily work priorities.

Its provision that all present incumbent Group III minority

workers shall move at once into Group I immediately drops

Group III whites in daily priority by whatever number of

minority workers of lesser seniority are added to the higher

priority Group I. Furthermore, the one-to-one ratio for

promotion thereafter of workers from Group III into Group

I as openings in Group I become available means that an

average non-minority Group III worker will not advance as

quickly up the daily priority ladder within Group III as he

would under straight raceless seniority. This results from the

fact that, whenever two openings in Group I become

available, one will be filled by a white worker senior to him

48a

and one by a minority worker of lesser seniority. Thus he

moves up only one step for every two Group I openings.

The situation is even less favorable at the Daily News

where for an initiai period as each Group I opening (rather

than two openings) becomes available, the employer will add

one minority and one non-minority employee to Group I.

The effect of the expansion of Group I to take in minority

members of lesser seniority is likely to slow down the rate of

advancement of non-minority persons within Group III more

than under a one-for-one arrangement limited to an equal

number of vacancies in Group I. Of course, in all cases once

a Group III white employee reached Group I, he will move

up in daily work priority (and priority for a Regular

Situation) on the same basis as existed before the agreement.

Appellant characterizes these effects as "leap-

frogging" or "bumping" of incumbent white workers, see

United States v. Bethlehem Steel Corporation, supra, 446 F.2d

at 659, and argues that we have rejected other affirmative

action programs having such an effect. It is true that we

have suggested that court ordered relief involving minority

employment goals be confined to entry level positions. Thus

in Bridgeport Guardians, Inc. v. Bridgeport Civil Serv. Comm.,

482 F.2d 1333 (2d Cir. 1973), we upheld the imposition of

racial hiring quotas at the patrolman’s level, the entry level

of the police force, but rejected the use of such quotas for

promotion to higher ranks. In United States v. Bethlehem

Steel Corp., 446 F.2d 652 (2d Cir. 1971), we simply noted that

minority transferees under the court’s order would be

transferred into job vacancies created in the normal course

of business and that no incumbent employee would be

"bumped" out of his job. Jd. at 664. In neither case did we

specifically pass on the propriety or fairness of "bumping" an

incurnbent.

These cases do not support rejection of the

agreement that has been reached in this case. The Bridgeport

Guardians decision was based upon the failure to establish

49a

any discrimination within the promotional system, the proof

being limited to discrimination at the point of entry into the

police force, i.e., in qualifying for the rank of patrolman. See

482 F.2d at 1333-41. In the present case, on the other hand,

there has been racial discrimination throughout the industry.

Furthermore, even assuming the desirability of confining use

of quotas to entry level positions, the effective point of entry

into employment in the industry has been at Group I, not

Group III. Judge Pierce found that "Group III workers do

not have full-time employment, nor do many of them have

great expectations or intentions of working full-time while

they shape from the Group III list." It is true, as appellant

points out, that both Group I and Group III workers must

shape regularly and neither has assurance of regular work.

But the fact remains that traditionally a worker who reached

Group I was on the road to a Regular Situation, whereas

one who was in Group III would not progress above that

level.

Even assuming that "bumping" of incumbents from

their present jobs is inadvisable in an affirmative hiring

scheme, it is inaccurate to characterize Group III workers as

having been "bumped." They have retained their position:

they have not been delisted in favor of minorities.

Moreover, we are not dealing with workers who have been

steadily employed under conditions where seniority is

synonymous with an assured job but with a fluctuating group

of shapers competing for a limited amount of work that

varies widely from day to day. Although some may have

declined somewhat in their daily work priority, as Judge

Pierce pointed out, the actual effect of this decline is difficult

to gauge since the availability of work at a given shape

depends on the stability of the total number of jobs available

from shift to shift and whether or not the new person

chooses to shape the same shift. In other words, assessing

a shaper’s expectation is a highly speculative exercise." In

addition, the number of minority workers promoted to

Group I on the date the agreement became effective, which

ccs

S0a

solely accounts for any decline in daily work priority, is quite

small. Only 13 of 178 Group III members at the News were

minority persons, 6 of 34 at the Times.

The impact of any dilution of daily work

opportunities resulting from the settlement agreement is,

furthermore, softened by the fact that all current Group III

members will be elevated to Group I within a fairly short

time. The News estimates that within a month after

implementation of the plan all non-minority workers above

47 on the Group III list will be elevated to Group I and that

thereafter about 27 non-minority persons per year will be

promoted from Group III to Group I. This suggests that any

decline in daily work priority attributable to the promotion

of presently incumbent minority workers to Group I will be

offset for most workers by a rise in priority within Group III

resulting from the expeditious upward movement of Group

III whites, also made possible by the program. Finally,

should some Group III workers have difficulty finding work,

the agreement empowers the administrator to assure that any

existing work opportunities in the industry be made available

to those unable 9 get at least 45 shifts of work in a calendar

quarter.

Aside from the foregoing, there was evidence from

which it could be inferred that, if there had been no racial

discrimination in the industry, more minority persons would

have been able to enter Group III and to gain seniority over

many whites within Group III. Thus, although Larkin has

been the victim of a system which excluded Group III

members, minority and white, from promotion to Group I,

he may well have been the modest beneficiary, vis-a-vis the

minority work force, of a policy that discouraged minority

persons from entering Group III. To the extent that the

settlement may cause a temporary decline in Group III white

worker’s rate of promotion and daily work priority, it merely

compensates for past discrimination by allowing a reasonable

number of minority persons to be promoted to the "rightful

place" on the seniority ladder, which they would have

Sla

occupied but for industry-wide racial] discrimination.

In any event it must be recognized that rights of the

kind Group III workers here assert "are not indefeasibly

vested rights but mere expectations derived from a

bargaining agreement and subject to modification." United

States v. Bethlehem Steel Corp., supra, 446 F.2d at 663. Here

appellant has applauded those modifications of the collective

bargaining agreement that are favorable to him, such as the

removal of the provision limiting Group I to former Regular

Situation holders. Under the peculiar circumstances that

have governed employment in this industry it does not strike

us as unfair to impose certain modifications on the manner

in which promotions or qualifications for daily work are

determined. Job seniority need not be the only standard for

determining promotions. Orders requiring that job vacancies

be filled by means other than normal routes o internal

promotion have been upheld as necessary to remedy past

discrimination. Gates v. Georgia-Pacific Corp., 492 F.2d 292

(9th Cir. 1974); cf. Allen v. City of Mobile, 331 F. Supp. 1134,

1142-43 (S.D. Ala. 1971), aff'd. per curiam, 466 F.2d 122 (Sth

Cir. 1973), cert. denied, 412 U.S. 909, 93 S.Ct. 2292, 36

L.Ed.2d 975 (1973) (§ 1983 actions), and indeed, affirmative

relief displacing white with greater seniority has been

granted, see United States Sheet Metal Workers International

Assn., Local 36, 416 F.2d 123, 133-34 (8th Cir. 1969).

The provisions of the settlement agreement affecting

Larkin thus cannot be characterized as illegal or unfair.

Whatever disadvantages he may temporarily suffer in terms

of daily work priority are offset by the substantial

improvement in his long range prospects arising from the

opportunity that has been created for the first time, for him

to reach Group I and, eventually, Regular Situation status.

Judge Pierce therefore did not abuse his discretion in finding

the settlement agreement to be fair to Larkin. The order is

affirmed.

FEINBERG, Circuit Judge (concurring)

52a

I concur in the result.

This case involves the difficult issue whether a hiring

quota based upon race can be legally imposed under the

Civil Rights Act of 1964 or the United States Constitution.

In the past few years, this court has twice held that such

quotas may be utilized to correct past discriminatory

practices in public employment. Vulcan Society v. Civil

Service Comm’n., 490 F.2d 387 (2d Cir. 1973) (firemen);

Bridgeport Guardians, Inc. v. Civil Service Comm'n., 482 F.2d

1333 (2d Cir. 1973), petition for cert. filed, 43 U.S.L.W. 3282

(U.S. Nov. 11, 1974) (policemen). We have also permitted

such remedial quotas in two cases in which the employment

was in the private sector of the economy. Rios v. Enterprise

Ass'n Steamfitters, Local 638, 501 F.2d 622 (2d Cir. 1974),

United States v. Wood, Wire & Metal Lathers, Local 46., 471

F.2d 408 (2d Cir.), cert. denied, 412 U.S. 939, 93 S.Ct. 2773,

37 L...Ed.2d 398 (1973).

Nevertheless, I believe a strong note of caution is

called for and should be stated. In Rios, Judge Hays wrote

a powerful dissent, arguing that section 703(j) of the Civil

Rights Act, 42 U.S.C. § 2000e-2(j), bars the use of court-

ordered racial hiring quotas." He distinguished our

‘Section 703(j) provides:

Nothing contained in this subchapter shall be

interpreted to require any employer, employment

agency, labor organization, or joint labor-

management committee subject to this subchapter to

grant preferential treatment to any individual or to

any group because of the race color, religion, sex, or

national origin of such individual or group on

account of an imbalance which may exist with respect

to the total number or percentage of persons of any

race, color, religion, sex, or national origin employed

by any employer, referred or classified by any labor

Organization, or admitted to, or employed in, any

(continued...)

53a

decisions in Vulcan Society and Bridgeport Guardians on

various grounds, the most persuasive of which was that

"there was no other means of affording relief that did not

interfere with essential public services" provided by firemen

and policemen. 501 F.2d at 638. In both cases, hiring had

to continue while new, non-discriminatory employment lists

were drawn up. Judge Hays also distinguished Wood, Wire

& Metal Lathers, because the union there, in accepting a

settlement, waived the benefit of section 703(j). A close

analysis of the cases in our circuit thus suggests that Rios is

the only decision squarely holding that a court may impose

a racial quota in a private employment case in the absence

of a settlement.

Emphasizing the status of the authority in this circuit

on the issue is worthwhile because, as we have earlier

pointed out, quotas should be approached "somewhat

gingerly." Bridgeport Guardians. supra, 482 F.2d at 1340. the

reason for this is clear: A racial quota is inherently

obnoxious, no matter what the beneficent purpose. Such a

quota is demeaning and divisive. At best it is a lesser evil.

It is not to be encouraged.

However, this case is not an appropriate one for

reexamination of the subject. The past discrimination

against minority workers here was made quite clear after a

four-week trial to the court. Minorities are conspicuously

absent from the ranks of Group I and Regular Situation

‘olders even though there are no special skills required to

fill the jobs involved. The intervenor asks us to upset a

settlement agreement that provides benefits for whites as

'(...continued)

apprenticeship or other training program, in

comparison with the total number or percentage of

persons of such race, color, religion, sex, or national

Origin in any community, State, section, or other

area, or in the available work force in any

community, State, section, or other area.

Sda

well as for minoritics. The quota the principal parties have

agreed upon is intended to be of short duration. 384 |

Supp. at 590-91. And finally, the intervenor does not direct |

his main attack against the idea of a hiring quota: he objects

to its size and the effect on him and others already in the

industry in Group IIT status |

Under all of these circumstances, I concur in the |

result |

No. 73- Civ. 3058

No. 73 Civ. 4278

United States District Court

Southern District Of New York

June 10, 1980

JOHN R. PATTERSON, et al

Plaintiffs.

NEWSPAPER and MAIL DELIVERERS’ UNION OF

NEW YORK & VICINITY, et. a/

+ / >

Defendan

EQUAL EMPLOYMENT OPPORTUNITY

COMMISSION

_ ,

Pla “+ .4#Ff

bGliitiill

NEWSPAPER AND MAIL DELIVERERS’ UNION OF

NEW YORK and VICINITY, er al.

Defendants.

JAMES LARKIN, et al

Intervenors.

S6a

PIERCE: D.J.:

Various defendants in these actions bring this

application for an order modifying the settlement agreement

which was entered into by the parties on June 27, 1974 and

subsequently approved by this Court on October 25, 1974.

The defendant/movants seek now to eliminate the positions

of Administrator of the setthement agreement. Under the

proposed modification of the setthement agreement, the

responsibilities of the Administrator would be performed by

the Equal Employment Opportunity Commission and by the

Adjustment Board of Hiring Practices, as established under

the collective bargaining agreement entered into by the

defendant Newspaper and Mail Deliverers’ Union and

various defendant employers. Before addressing the merits

of this application the history of these actions will be

reviewed briefly.

History of Actions

These actions were commenced in 1973. Plaintiffs

alleged that defendants had engaged in employment

discrimination in violation of Title VII of the Civil Rights

Act of 1964, 42 U.S.C. § 2000 et seq. At the conciusion of a

four-week trial on the merits, the parties agreed to a

settlement of the claims asserted. However, the terms of the

settlement agreement were opposed by certain intervenors.

By Memorandum Opinion and Order dated

September 19, 1974, this Court approved the settlement

agreement. Patterson v. Newspaper and Mail Deliverers’

Union of New York and Vicinity, [8 EPD 19736], 384 F. Supp.

585 (S.D.N.Y. 1974). It was noted in that decision that the

nepotistic membership policy of the defendant union prior to

1952 had resulted in discrimination against minority

applicants. since few, if any, members of the union were

from minority groups. Jd. at 589. Indeed, as stated by the

Court of Appeals for the Second Circuit on review of the

aforesaid decision, "[h]istorically the Union has excluded

S7a

minorities and has limited its membership to the first born

son of a member.” Patterson v. Newspaper and Mail

Deliverers’ Union of New York and Vicinity, {9 EPD § 10,033},

514 F.2d 767, 770 (2d Cir. 1975). At the time this Court

approved the settlement agreement, less than 1% of the

members of the union were from minority groups. Patterson

v. Newspaper and Mail Deliverers’ Union of New York and

Vicinity, supra, 384 F. Supp. 588.

The settlement agreement entered into by the parties

set forth the goal of increasing minority employment in the

industry to 25%. To help achieve this goal, the position of

Administration of the settlement agreement was established

under the express terms of the settlement agreement. Under

paragraph 4 of the agreement, the Administrator was

“empowered to take all actions . . . as he deems necessary to

implement the provisions [of the agreement] and to ensure

performance of the Order [approving the settlement]." The

terms of paragraph 4 aiso provided that the Administrator

was responsible for reviewing and determining all

“complaints that any individual in the bargaining units in the

industry represented by NMDU has been allegedly denied

equal employment opportunities on the basis of race, color

Or national origin and [for deciding any questions of

interpretation and claims of violation of the Order

[approving the settlement] by any party or by any such

individual employee or applicant for employment.

Paragraph 6 of the settlement agreement provides

that the Administrator shall be designated by the Court and

shall remain in that position for an initial period of five years

at the conclusion of which he or his successor shall remain

in office for such time as this Court directs. Pursuant to that

provision, William S. Ellis, Esq. was appointed by the Court

as Administrator of the settlement agreement in November,

1974.

In this Court’s view, since the date of his

appointment, the Administrator has performed his duties

58a

with dedication and has ably and fairly fulfilled his

obligations. In his report to the Court dated October 19,

1979, the Administrator indicated that as of April 31, 1979

the percentage of minority employment was 12.16%, slightly

less than half the goal set forth in the settlement agreement.

That report also lists fifteen pending matters which were

before the Administrator as of the date of the report. By

letters to the Court dated January 16, 1980, March 10, 1980,

and June 3, 1980 the list of pending matters had been

updated. As of June 3, 1989, eleven matters were pending.

On November 11, 1979, the initial appointment of the

Administrator terminated pursuant to paragraph 6 of the

settlement agreement as discussed above. See Order dated

October 29, 1979. Thereafter, Ellis was appointed as Interim

Administrator pending resolution of the present motion for

modification of the settlement agreement. See Order dated

November 13, 1979.

Motion for Further Relief and

Modification of Agreement

The defendant/movants seek to eliminate the position

of the Administrator and to substitute the EEOC and the

Adjustment Board on Hiring Practices as the principal

agencies responsible for implementation of the settlement

agreement. The Adjustment Board was established by the

collective bargaining agreement between the union and two

defendant employers, the New York Times, Co. and the New

York News, Inc. It is composed of four members of which

two members are designated by the union and two members

are designated by the Publishers /Association of New York

City. The defendant/movants are members of the Publishers

Association. Under the collective bargaining agreement, the

Adjustment Board is responsible for hearing and determining

employment disputes.

59a

Under the proposed plan submitted by the

defendant/movants, all complaints would be initially filed

with the EEOC. The EEOC would then refer the dispute to

the parties for 45 days for voluntary settlement purposes. If

no resolution is reached within that time the EEOC should

refer the complaint to the Adjustment Board for final and

binding resolution. The Board’s decision would then be

submitted to the EEOC. Any party could then request a

plenary review of the Board’s decision by this Court.

The principal arguments asserted by the

defendant/movants in support of their application are that:

(1) the expense of maintaining the positions of the

Administrator is high; (2) the EEOC and the Adjustment

Board can fulfill the functions of the Administrator; (3) the

industry is declining; (4) significant progress has been made

toward the achievement of the 25% minority employment

goal.

Both the EEOC and the Interim Administrator have

responded to the proposed plan in compliance with the

request of this Court. The EEOC has indicated that it will

not function as a substitute for the Administrator. It is

prepared, however, to assume a role in three areas formerly

filled by the Administrator. It will initially process

complaints through its "Rapid Charge Processing System.”

It will also forward all claims to the employers and the union

for vojuntary resolution or to the Adjustment Board for

arbitration. The EEOC will also monitor the periodic

reports from the defendants which have been monitored in

the past by the Administrator. See Settlement Agreement 9

7 at p. 5. The statement by the EEOC regarding the extent

to which it will be able to participate in the implementation

of the settlement agreement is consistent with the plan

proposed by the defendant/movants.

The Interim Administrator indicates that he favors a

greater participation of the EEOC in the implementation

process than that proposed by the defendant/movants. He

60a

has proposed that the EEOC not only initially process claims

but also that it participate in the initial attempts to resolve

disputes, hold adjudicative hearings, provide legal and

advocacy services to complainants, and be available to

answer questions of current and prospective employees

regarding their rights under the settlement agreement. He

also states that the role of the administrator as an overall

supervisor of the industry’s progress toward the 25%

minority employment goal should be preserved. |

Discussion

As indicated above, less than 1% of the membership

of the defendant union and less than 2% of the employment

in this industry consisted of persons of minority background

in 1974. Although significant progress has been made

toward the achievement of the settlement goal, it appears

that full achievement thereof is not imminent. Less than

one-half of the 25% minority employment goal has been

achieved in the five-year period from 1974 through 1979,

according to the Administrator’s last report to the Court.

The progress of the industry toward achievement of this goal

has not yet reached the point, at which the Court should

dispense with the requirement of supervision by a neutral

party as set forth in the voluntary settlement agreement.

Some mechanism must be provided which will ensure the

continued advancement toward the settlement goal.

In this regard, the proposed replacement of the

Administrator with the EEOC and the Adjustment Board is

not an acceptable alternative to maintaining the position of

the Administrator. Under the proposed plan the central!

function of resolving claims of racial employment

discrimination is to be referred to the Adjustment Board

which consists of person representing the very defendants

who have been charged in these actions with having engaged

in practices which resulted in the exclusion of minority

employees in this industry. Indeed, some of the claims of

employment discrimination which, under this proposal the

eee

6la

Adjustment Board would be called upon to resolve, might

well involve defendants who have representatives on the

Board.

The Court is mindful of the burden borne by

defendants with respect to the costs incurred under the

present structure. It is not inappropriate that such costs fall

upon those whose conduct or failures have caused the legal

and factual situation complained about in the first place.

Accordingly, the application of the defendant/

movants is denied. William S. Ellis, Esq. is hereby appointed

as Administrator of the settlement agreement, pursuant to

paragraph 6 thereof, for a period of five years commencing

with the date of the entry of this Memorandum and Order.

Since the EEOC and the Administrator agree that the

EEOC should participate in the implementation of the

settlement agreement, the Court requests that the EEOC

and the Administrator submit within 30 days a joint plan

regarding the roles of the EEOC and the Administrator.

A final matter which requires resolution is the

compensation of the Administrator. Pursuant to the Final

Order and Judgment dated October 24, 1974, the

Administrator has received compensation for the pasi five

years at the rate of $65.00 Per hour. That rate of

compensation, however, is not now consistent with the

current rate received by the attorneys in this region. The

Court notes that the law firm of which the Administrator is

a member presently charges between $85.00 and $150.00 per

hour. See Affidavit of William S. Ellis dated May 6, 1980.

Under paragraph 5 of the settlement agreement, the Court

is authorized to fix the hourly compensation of the

Administrator in its discretion. Therefore, the Court hereby

directs that William S. Ellis, Esq. shall receive compensation

for his future services as Administrator of the settlement

fund, commencing with the date of the entry of this

Memorandum and Order, at the rate of $85.00 per hour to

be paid in accordance with the Order of this Court dated

fa

Tune 11. 1975

Si Cyrce Té d

fita

No. 73-Civ. 3058 (WCC)

No. 73-Civ. 4278

Filed December 15, 1986

United States District Court

Southern District of New York

JOHN R. PATTERSON, et seq

Plaintiffs.

NEWSPAPER & MAIL DELIVERERS’ UNION OF

NEW YORK & VICINITY, et a/

Defendants

EQUAL EMPLOYMENT OPPORTUNITY

COMMISSION

A ee

Plaintiff.

NEWSPAPER AND MAIL DELIVERERS’ UNION O

NEW YORK AND VICINITY, et ai.

Defendants.

CONNER, D.J.:

A class of private plaintiffs and the Equal

Employment Opportunity Commission ("EEOC") brought

two civil rights action in 1973 against the Newspaper and

Mail Deliverers’ Union of New York and vicinity ("the

Union") and more than fifty publishers and news distributors

within the Union’s jurisdiction. Both suits charged that the

Union, with the acquiescence of the publishers and

distributors, had historically discriminated against blacks and

other minorities, and that the structure of the collective

bargaining agreement, combined with nepotism and

cronyism, had perpetuated the effects of the past

discrimination in violation of Title VII of the Civil Rights of

1964. Each lawsuit sought an affirmative action program

designed to achieve the minorities the status they would have

had in the newspaper delivery industry but for the alleged

discrimination practices.

On September 19, 1974, then-District Judge Lawrence

W. Pierce issued an opinion and order approving a

settlement between the parties. Patterson v. Newspaper &

Mail Delivers’ Union, {8 EPD % 9736), 384 F. Supp. 585

(S.D.N.Y. 1974), affd [9 EPD 9 10,033], 514 F.2d 767 (2d

Cir. 1976), cert. denied {12 EPD 1% 11,008], 427 U.S. 911

(1976). The setthement agreement provided that all

defendants would be "permanently enjoined from engaging

in any act or practice which has the purpose or the effect of

discriminating against any individual or class of individuals

on the basis of race, color or national origin." Settlement

Agreement 97 1,2. The Union was required to "receive and

process applications for membership, admit members, handle

grievances and otherwise administer all of the affairs of the

NMDU so as to ensure that no individual represented by it

is excluded from equal advancement, on the basis of race,

color or national origin." /d. 11. The employers agreed not

to "fail or refuse to hire for employment any [individual in

their bargaining unit represented by the union], [or to] take

any other action which would deprive any such individual of

6Sa

equal employment opportunities or otherwise adversely affect

his status as an employee or as an applicant for employment

because of such individual’s race, color or national origin.”

Id. % 2.

In addition, the settlement agreement included an

affirmative action program that set a minimum goal of 25%

minority employment in Regular Situation and group

positions in the industry by June 1, 1979. Jd. 17. In an

order dated June 10, 1980, Judge Pierce extended the

consent decree for another five-year period because the goal

of 25% minority employment had not been reached. Now

the Administrator and defendants report that the goal has

been reached.

Consequently, the Union and most of the defendant

employers have moved to vacate the consent decree in its

entirety, or in the alternative, to modify the decree to

eliminate the affirmative action provision. The EEOC has

opposed a complete termination of the decree, but does not

object to a modification of the affirmative action provisions

for those companies that have 25% minority employment.

The private plaintiffs, however, have vigorously objected to

defendants’ suggestion that the terms of the consent decree

Should be relaxed and have cross-moved for further relief

under the conseni decree. Needless to say, defendants have

indicated that they oppose these proposals.

On October 21, 1986, I issued an opinion and order

deferring a decision on motions of the parties pending a

hearing scheduled for the matter on Monday, February 23,

1987 at 10:00 A.M. in Courtroom 618. Since that time

numerous disputes have arisen concerning the scope of

discovery on the issues raised by the parties’ motions. I issue

this opinion to provide guidance to the parties concerming

the permissible scope of discovery.

In my opinion of October 21, 1986 I ordered an

evidentiary hearing to decide whether the consent decree

66a

should be terminated or modified. The consent decree

represents a settlement between the parties of this case

which was approved by Judge Pierce as long ago as

September 19, 1974. This Court is not a party to this

agreement and must respect the terms reached by those who

are parties to the settlement. Accordingly, | must proceed

cautiously before upsetting the settlement agreement in any

way.

At the February hearing, the only issue before the

Court will be whether the consent decree should be

terminated with respect to some or all of the defendants.’

The hearing will not be for the purposes plaintiff has

suggested: ie, to determine whether defendants have

violated Title VII of the Civil Rights Act of 1964 or the

consent decree. If plaintiffs believe that defendants have

violated the consent decree, they should apply to the

Administrator for relief pursuant to the decree.’ If they

believe that the decree was insufficient to end discrimination

in the industry, they must bring a new action for the relief

they seek. This Court cannot grant such relief by modifying

the consent decree.

As I said in my October 21, 1986 opinion, the private

plaintiffs are entitled to discovery on the issues to be

determined at the hearing, to facilitate a complete and

orderly presentation of evidence at the hearing. Any

discovery before the February hearing must, however, be

limited to the issue before the Court on that date. Plaintiffs’

‘It is therefore unnecessary for the Court to consider plaintiffs’

motion to bifurcate the issues at the February hearing.

*Under the terms of the settlement, the Court’s role is limited to

review of decisions by the Administrator where timely objection is

made in writing. The express terms of the decree provide that alleged

violations of the decree are to be brought before the Administrator.

Any questions of discovery related to such claims should alsc be

brought before the Administrator in the context of those proceedings.

67a

First Interrogatories are therefore overbroad and defendants

are not required to answer them. Since the appropriate

scope of discovery is much less broad than plaintiffs first

proposed, it is not necessary at this time to order discovery

to be expedited

So Ordered

68a

Nos. Civ. 3058 (WCC), 73 Civ. 4278 (WCC)

United States District Court

Southern District of New York

March 15, 1988

JOHN E. PATTERSON, et al.,

Plaintiffs,

We

NEWSPAPER & MAIL DELIVERERS’ UNION OF

NEW YORK & VICINITY, ez. al,

Defendants.

EQUAL EMPLOYMENT OPPORTUNITY

COMMISSION,

Plaintiff.

Vv.

NEWSPAPER AND MAIL DELIVERERS UNION OF

NEW YORK AND VICINITY, et al,

Defendants.

CONNER, D.J.

A class of private plaintiffs and the Equal

Employment Opportunity Commission ("EEOC") brought

two civil rights actions in 1973 against the Newspaper and

69a

Mail Deliverer’s Union of New York and vicinity and more

than fifty publishers and news distributors within the Union’s

jurisdiction. Both suits charged that the Union, with the

acquiescence of the publishers and distributors, had

historically discriminated against minorities, and that the

structure of the collective bargaining agreement, combined

with nepotism and cronyism, had perpetuated the effects of

the past discrimination in violation of Title VII of the Civil

Rights Act of 1964. Each lawsuit sought an affirmative

action program designed to achieve for minorities the status

they would have had in the newspaper delivery industry but

for the alleged discriminatory practices.

On September 19, 1974 then-District Judge Lawrence

W. Pierce issued an opinion and order approving a

settlement between the parties and incorporating it in a

consent decree. Patterson v. Newspaper & Mail Deliverer’s

Union, 384 F. Supp. 585 (S.D.N.Y. 1974), aff'd, 514 F.2d 767

(2d Cir. 1975), cert. denied, 427 US. 911 (1976). The

Settlement agreement established an Administrator,

appointed by the Court, to implement the provisions of the

consent decree and to supervise its performance. The

Administrator hears all claims concerning violations of the

consert decree. Appeals from his decisions are heard in this

Court.

The action presently before the Court is an appeal

from the Administrator’s ruling of July 22, 1987. For the

reasons set forth below, his ruling is affirmed.

I. Background

The settlement agreement enjoins all defendants from

discriminating against any individual or class of individuals

on the basis of race, color or national origin. Settlement

Agreement 17 1, 2. By the terms of the agreement, the

Union is required to "receive and process applications for

membership, admit members, handle grievances and

otherwise administer all of [its] affairs . . . so as to ensure

70a

that no individual represented by it is excluded from equal

work opportunities including overtime and advancement, on

the basis of race, color or national origin." Jd. 11. The

employers agreed not to deny employment to individuals in

the bargaining units represented by the Union, or to deprive

such individuals of equal employment opportunities, or

otherwise adversely affect their status as employees or

applicants for employment because of their race, color or

national origin. Jd. 12.

The settlement agreement also establishes an

affirmative action program which modifies the collective

bargaining agreement for the industry. Prior to the

settlement agreement, the collective bargaining agreement

required each employer to maintain a work force of regular

situation holders for its minimum needs. To accommodate

fluctuations in the circulation of the various publications

produced by the employers, the contract permitted employers

to supplement their work force with daily shapers.

The shapers at the major employers were categorized

into groups with descending daily hiring priorities. The

group I list was restricted to persons who at one time had

held a regular situation in the industry. They had first

priority at every shift, in order of their shop seniority. After

group I was exhausted at any given shift, the next hiring

priority went to group II members. Group II consisted of all

persons in group I and all persons holding regular situations

in the industry. Once all of the group II members who had

appeared for work were employed, the remaining jobs, if

any, went to group III members, in order of their shop

tenure.

In addition to structuring the daily hiring priorities,

the group system also was supposed to represent the priority

list for filling regular situations as they became vacant. As

a regular situation opened, the person with the greatest

tenure on the group III list was entitled to move up the

group system.

Tila

Judge Pierce found that the group system promoted

nepotism and cronyism as the determining factors of

advancement within the industry. This had a discriminatory

impact on minorities, who were effectively barred from

advancing up the group system.

The affirmative action program incorporated in the

settlement agreement was designed to correct this

discrimination by modifying the group system. The program

eliminates the contract provision that the restricted group I

to former regular situation holders, and provides for the

orderly flow of group III shapers into group I, and from

there into regular situations. The agreement mandates that

for each non-minority group III member elevated to group

I, a minority group III member must also be elevated.

Settlement Agreement, 911. In addition, for every two non-

minority persons added to the group III list, three minority

persons must be added. /d. at 115. Regular situations are

filled as they become available by advancing the most senior

group I member, without regard to race, color or national

origin. Id. at 1 10(c). The goal of the affirmative action

program is 25% minority employment in the bargaining unit

throughout the industry. Jd. at 9 7.

The Union wrote to the administrator on September

26, 1986, and requested that he exempt the group III list at

New York News, Inc. ("News") from the required 3:2 ratio.

The Union asserted that the News was no longer bound by

the settlement agreement because minority representation on

the group III list was substantially above 25%. On

November 21, 1986, the administrator responded by letter

that he did not object to the Union’s proposal. The Union

and the News, however, did not wait for the administrator’s

response, and on November 4, 1986, the Union and the

News advanced ten non-minorities and four minorities to the

News’s group III list.

Shortly thereafter, the Union and most of the

defendant employers moved to vacate the consent decree in

72a

its entirety, or in the alternative, to modify the decree to

eliminate the affirmative action provisions, based upon the

attainment of the 25% goal. On February 23, 1987, the

Court held a hearing on the question of whether the 25%

goal had been achieved. Although some employers were

able to show that minority employment had reached or

exceeded 25% among their employees, it did not appear that

minority employment in the bargaining unit had reached

25% throughout the industry. The Court noted that

paragraph seven called for "25% minority employment in the

industry.” Hearing Transcript at 124-25 (quoting the

Settlement Agreement)(emphasis added). Relying on the

express language of the agreement, the Court ruled from the

bench that individual employers could not be released from

the consent decree, even upon achieving the 25% goal, until

minority employment reached 25% in the industry. /d. at

125-26. The Court deferred its decision on the motion to

terminate the decree until defendants could produce

sufficient evidence to demonstrate that minority employment

in the bargaining unit is at 25% throughout the industry as

a whole. /d. at 132.

On July 22, 1987, the Administrator ruled that the

News and the Union had violated the settlement agreement

by adding ten non-minorities and only four minorities to the

News’s November 4, 1986 group III list, and he ordered the

placement of eleven minorities on the list. The Union has

appealed.

Il. Discussion

Paragraph fifteen of the settlement agreement

mandates that three minority employees be added to the

News’s group III list for every two non-minorities. There are

no exceptions to this rule.

The Union argues, however, that the Administrator’s

decision in July 1987 was in conflict with his prior approval,

by his November 1986 letter, of an exemption for the News

73a

from the terms of the agreement. In the Union’s view, the

Administrator’s reversal was not justified by a change in

circumstances; minority employment at the News in July of

1987 was still in excess of 25% as it was when the

administrator issued his letter in November, 1986.

Accordingly, the Union asserts that the Administrator’s

decision in July 1987 should be overturned as arbitrary and

Capricious.

The Union’s argument ignores the significance of the

hearing held before this Court in February 1987. At that

hearing the Court ruled that the affirmative action program

could not be terminated until the entire industry had

achieved the 25% goal. The Administrator placed special

emphasis on this ruling in his opinion, Stating, "Despite

recent challenges to it by the defendants, the Decree has not

been terminated or modified by the Court; it is still in full

force and effect and binding on the parties and the

Administrator.". Record on appeal at 4 (emphasis in

Original). Thus, the administrator’s ruling was justified by his

reliance on the hearing before this Court, and clearly was

neither arbitrary nor capricious.

The Union also contends that the administrator’s

decision does not appropriately construe paragraph fifteen of

the settlement agreement. In support of this contention, the

Union relies on language in paragraphs seven and eleven,

which refer to the affirmative action plan set forth in

paragraph fifteen as the "new hiring procedure." On the

basis of this language, the Union concludes that the

affirmative action plan was only intended to apply to persons

who are "new hires," that is, persons who have never before

worked in the industry. Since the non-minorities who were

advanced to the group III list and shaped for previous shifts

at the News, they were not new hires, and therefore were not

subject to the affirmative action plan.

The Union’s reasoning is nothing more than sophistry.

The agreement makes no reference to so called new hires.

74a

It refers to a "new hiring procedure.” This merely

acknowledges that the hiring procedure described in

paragraph fifteen is new in that it modifies the old hiring

procedure that was employed under the collective bargaining

agreement.

Finally, the Union asserts that the affirmative action

program should be terminated as to the News because

minority employees at the News already constitute more than

25% of the work force. It is well established that affirmative

action programs must be terminated once the target racial

balance is reached. See Johnson v. Transportation Agency,

Santa Clara County, 107 S.Ct. 11456 (1987), Local 2, Sheet

Metal Workers’ Intl Ass'n v. EEOC, 106 S.Ct. 3019, 3052

(1986); United States Steel Workers of America v. Weber, 443

U.S. 193, 208,09 (1979). As discussed above, however, the

Court concluded at the February 1987 hearing that the

agreement established a goal of 25% minority employment

in the bargaining unit throughout the entire industry. The

Court refused to lift the decree as to individual employers

even though they may have achieved the 25% goal. The

evidence submitted at that hearing failed to prove 25%

minority employment in the industry, and the Union has not

submitted any new evidence on this appeal. Therefore, the

3:2 hiring ratio still applies.

III. Conclusion

For the foregoing reasons, the decision and order of

the administrator is affirmed in all respects.

So Ordered.

75a

JOHN E. PATTERSON, et al,

Plaintiffs

Vv.

NEWSPAPER & MAIL DELIVERERS’ UNION OF

NEW YORK & VICINITY, e7. al,

Defendants.

In the Matter of the Group III List of

THE NEW YORK TIMES, pursuant to the

terms of the Settlement Agreement.

U.S.D.C., $.D.N_Y.

73 Civ. 3058 (WCC). 73 Civ. 4278 (WCC)

Claim No. 186

United States District Court,

S.D. New York

Sept. 25, 1991

OPINION AND ORDER

WILLIAM C. CONNER, District Judge.

A class of private plaintiffs and the Equal

Opportunity Commission ("EEOC") brought two civil rights

actions in 1973 against the Newspaper and Mail! Deliverers’

Union of New York and Vicinity ("NMDU" or "Union") and

more than fifty news publishers and distributors within the

Union’s jurisdiction. Both suits charged that the Union, with

the acquiescence of the publishers and distributors, had

historically discriminated against minorities, and that the

Structure of the collective bargaining agreement, combined

with nepotism and cronyism, had perpetuated the effects of

past discrimination in violation of Title VII of the Civil

76a

Rights Act of 1964. Each lawsuit sought an affirmative

action program designed to achieve for minorities the status

they would have had in the newspaper delivery industry but

for the alleged discriminatory practices.

On September 19, 1974, then-District Judge Lawrence

W. Pierce issued an opinion and order approving a

settlement between the parties and incorporating the

Settlement Agreement in a Consent Decree, familiarity with

which is presumed. See Patterson v. Newspaper and Mail

Deliverers’ Union, 384 F.Supp. 585 (S.D.N.Y. 1974) aff'd, 514

F.2d 767 (2d Cir. 1975), cert. denied, 427 U.S. 911, 96 S.Ct.

3198, 49 L.Ed.2d 1203 (1976). The Settlement Agreement

implements an affirmative action program which modifies the

hiring procedures for newspaper deliverers under the

industry-wide collective bargaining agreement. Under the

consent decree, each employer maintains a work force of

regular situation holders for its minimum delivery needs. To

accommodate fluctuations in circulation, the publishers are

permitted to supplement their work force with daily shapers.

The daily shapers are divided into three groups with

descending hiring priorities. Those shapers on the Group |

list have first priority after the regular situation holders, in

order of their shop seniority. The next priority Delongs to

Group II shapers. Group II consists of all persons holding

regular situations or Group I positions with other employers

in the industry. The last priority belongs to Group III

shapers.

The Settlement Agreement also established an

Administrator, appointed by the Court, to implement the

provisions of the Consent Decree and to supervise its

performance. The Settlement Agreement authorizes the

Administrator to hear claims concerning violations of the

Consent Decree. Appeals from his decisions are heard in

this Court.

Pursuant to the Settlement Agreement, plaintiffs seek

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review of a determination by Administrator William S. Ellis,

Esq. (the "Administrator"), denominated "Claim 186." I have

reviewed the exhibits and testimony relied upon by the

Administrator, as well as the arguments submitted to the

Court by the various parties. For the Reasons set forth

below, the Administrator’s decision is affirmed.

BACKGROUND

In the Spring of 1984, in the belief that the goal of

25% minority employment in the industry hac been reached,

the Union and most of the defendant employers moved to

vacate the Consent Decree in its entirety, or in the

alternative, to modify the decree to eliminate the affirmative

action provisions. During the period that followed the

making of these motions, the matter of Claim 186. The New

York Times ("Times") and the Union wished to expand the

Group III list to approximately 160 employees and to avoid

the 3/2 ratio required by paragraph 15 of the Settlement

Agreement.

In February 1985, the Times and the NMDU

approached the Administrator to seek his authorization to

permit the issuance of a Group III list which would not

conform to the 3/2 ratio. The Administrator declined to

agree to such a modification, informing the parties that for

such authorization to be given, it would have to be with the

consent of all the parties to the Consent Decree with the

approval of the court.

The Administrator issued an order on August 13,

1985 that such a list should not be issued. Although the

Settlement Agreement establishes a procedure for the appeal

of Orders of the Administrator, the defendants did not

appeal the Administrator’s order freezing the Times’ Group

III list. See Settlement Agreement at 14. In direct

contravention of both the Settlement Agreement and the

Administrator’s Order, the Adjustment Board of the Times

and the Union proceeded to issue a new Group III list of

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approximately 175 names effective August 15, 1985.' A

minority person was placed into every fourth position on the

new list. Prior to the issuance of the Preliminary Group III

list, the Group III list of the Times had rarely been greater

than 40 employees.’

On August 20, 1985, the Administrator directed the

Times and the NMDU not to use this Preliminary Group III

list. The NAACP Legal Defense Fund ("LDF") and the

EEOC objected to the list. A hearing before the

Administrator was scheduled for August 26, 1985 to consider

the objections raised by LDF. At that hearing, after all sides

were afforded a full opportunity to be heard, the

Administrator directed that (1)a notice should be attached

to the Preliminary Group III list emphasizing that it was

temporary and subject to the hearing to be held before the

Administrator and (2) the Adjustment Board hear the

complaints of certain individuals, adding such names as

appropriate to the bottom of the list. The Administrator

also ordered that the list comprise 30% minority persons.

Finally, the Administrator ruled that so long as the persons

on the list were qualified a provided in the Adjustment

Board’s conditions to the list, the Times could hire them

from the list while the litigation proceeded. Transcript 114-

115, 120.

It was the understanding of all parties that this

proceeding would be resolved in two or three weeks and that

a new list would be issued with the approval of the

Administrator. The hearing started in October 1985, and it

was not completed until approximately 6000 pages of

‘The Adjustment Board is provided for in the collective

bargaining agreement. It is composed of two Times and two NYDU

. epresentatives.

> At the time that the Preliminary Group III list was issued in

August 1985. The Times had reached a minority employment

percentage of 30.14%. The industry-wide figure was 24.4%.

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transcript later, in July 1988.

The Administrator’s Findings

At the hearings the parties presented extensive

evidence concerning the formation of the Preliminary Group

III list. Based on the evidence presented in the case the

Administrator concluded that both the Times and the

NMbDU had violated the following provisions of the

Settlement Agreement:

1. Paragraph 15, dealing with the 3/2 ratic

required of the Group III list.?

The Administrator found that in light of his refusal to

modify the Settlement Agreement in order to permit less

than the 3/2 ratio, the Times and the NMDU were obligated

to follow paragraph 15 or, in the alternative, to seek recourse

to this Court for the purpose of obtaining authorization for

such modification. In the face of no such authorization, the

Administrator concluded that the Adjustment Board had

violated paragraph 15 of the Settlement Agreement whit

issued the Preliminary Group III list.

y Paragraph 15, dealing with the standards to be

followed in giving preferences to certain

employees to be place on a Group III list.

The Administrator found that the evidence indicated

that the primary basis for placing and positioning persons on

the Preliminary Group III list was determined by the

seniority of one’s sponsor at the Times. If the sponsor, who

> This term means that for every five employees added to the

Group III list, three were to be minorities and two were to be non-

minorities.

Paragraph 15 provides in relevant part:

Defendant employers shall offer positions available

-- OM the basis of three (3) minority employees for

every two (2) other employees.

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was usually the father or some other relative of the

applicant, had seniority at the Times, the position of the

applicant was determined by reference to such sponsor’s

seniority. Although the Times attempted to prove that there

were other criteria such as (a) shifts worked, (b) tractor-

trailer driving ability, and (c) commitment and interest,

which were taken into account in determining the placement

of an applicant on the proposed Group III list, the

Administrator found that such other criteria played but a

minor role in the decision. The Administrator’s

Determination in Claim 186 dated February 27, 1991

("Administrator’s Determination") at 47. Based on the

evidence before him the Administrator concluded that the

Times and the Union had discriminated in violation of

paragraph 15 of the Settlement Agreement.

3. Paragraph 29, dealing with the establishment

of a system for the submission of applications.

The testimony given before the Administrator

indicated to him that the method by which an applicant

applied for placement on the Preliminary Group III list was

to give a slip of paper with the name and social security

number of the applicant to a foreman or a union official.‘

These slips of paper were collected and treated by the

Adjustment Board as applications for Group III. The

testimony of various officials who handled these applications

indicated that at times no one was sure who was keeping

them or where they were being kept. This method of

submitting applications for placement on Group III is not set

forth in any official document of either the Times or the

NMDU or in the Settlement Agreement.

The Administrator found that minority persons were

not usually told about this method of submitting applications.

4

If any Times’ employee submitted a slip of paper on behalf

of another person he became known as a sponsor.

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In the instances in which they were told, the Administrator

found that they were often given incorrect information.

In addition a formal application was available in the

lobby of the Times’ building. Several minority claimants

were found to have filled out such applications. The

Administrator found, however, nothing in the testimony to

Suggest that the Times ever looked at these applications.

Though the policy of the Times required that these formal

applications be submitted to the Delivery Department for

consideration, the Administrator found that these

applications were not reviewed by the Delivery Department

prior to making the new Group III list.

4. Paragraphs 1 and 2 in reference to

discriminatory treatment in the offlist hiring

of minority employees and in the various

practices of the industry.

The language of paragraphs 1 and 2 of the Settlement

Agreement provides that the defendants are prohibited from

discrimination in purpose and effect. Under the terms of the

Settlement Agreement all activity on the regular situation

list, the Group I list, and the Group III list is regulated.

Parties to the Settlement Agreement have no discretion to

act except pursuant to its terms. In contrast to its procedure

for hiring of individuals on the Group I, II and III lists, the

Times had no policies or procedures to govern selection of

offlist workers but for the general prohibitions of the

Settlement Decree.

Based upon the evidence presented, the

Administrator found that each of the claimants proved an

individual claim of racial discrimination in violation of

paragraphs 1 and 2 of the Settlement Agreement with regard

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to offlist hiring.*

Moreover, the Administrator concluded that since the

new Group III list took into account various hiring records

which had been developed during offlist hiring, the

discriminatory hiring affected the composition and order of

the new Group III list. The Administrator found that the

evidence supported eighteen individual claims of intentional

discrimination with regard to exclusion from or low

placement on the Group III list.

Three non-minority, non-union, intervenors, Richard

M. Johnson, Richard W. Johnson, and Donald Schley alleged

that the Times and the NMDU had violated paragraphs 15

and 29 of the Settlement Agreement and that such alleged

violations had an adverse affect on them. The Administrator

dismissed their claims for lack of standing.

Remedies

In light of his findings of fact and conclusions of law

the Administrator prepared a Group I list on a one-to-one

basis, consisting of 48 minorities and 48 non-minorities and

a Group III list, as of September, 1985.° The Administrator

also awarded back pay to those claimants whom he found to

have proved individual claims of discrimination with regard

to the creation of the Preliminary Group III list. The back

pay award covered the period from the date of the issuance

of the Preliminary Group III list to November 30, 1988, the

*The Administrator concluded that the plaintiffs failed to prove

that there was a pattern and practice of intentional discrimination and

that the new list had an adverse impact. Administrator's

Determination at 59.

*In the fail of 1988, the Administrator applied to the Court for

permission to issue an Interim Group I list due to delays in the

resolution of Claim 186. The court granted the application by an

order dated November 30, 1988 in Claim 229. An Interim Group I

list was issued soon thereafter.

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date on which the Interim Group I list was issued.’

As discussed above, the Administrator found that

defendants engaged in intentional racial discrimination

against all of the claimants in offlist hiring. |The

Administrator further concluded that "each [of the claimants]

is entitled to an appropriate remedy for the [offlist hiring]

violation." Administrator’s Determination at 57. The

Administrator failed to state explicitly what type of remedy

should be imposed for this violation.

Finally, the Administrator ruled that the LDF was

entitled to Attorneys’ Fees.

DISCUSSION

The Agreement provides the Administrator with

broad authority to take all actions he deems necessary to

implement the provisions and to ensure the performance of

the Order. It further provides that the Administrator shall

hear and determine a wide variety of claims arising under

the Agreement, which may then be brought before the Court

for review. Agreement 1 4.

In Foreman v. Wood, Wire & Metal Lathers

International Union, Local No. 46, 557 F.2d 988, 992 (2d Cir.

1977), the Court of Appeals for the Second Circuit noted

that the Scope of review of an independent administrator

appointed to ensure compliance with a settlement decree was

similar to that applied to an arbitrator’s decision. More

recently in United States v. International Brotherhood of

Teamsters, Etc., 905 F.2d 610, 616 (2d Cir. 1990), the Second

Circuit Court reiterated that an administrator’s decision is

"entitled to great deference." Thus, it is clear that an

administrator’s decision cannot be rejected merely because

a court may be inclined to reach a different result.

"Back pay was to include benefits, vacation pay, pension

contributions, and interest on any back pay award.

84a

The Times places great emphasis on its position as

"the pacesetter in the industry in affording bargaining unit

employment opportunities to minorities." Times Brief at 13.

Both the Times and the NMDU argue that the Adjustment

Board issued the Preliminary Group III list at a time when

it appeared that departure from the 3:2 ratio was permissible

if not required. Relying on the fact that the "Times Delivery

Department work force was approximately 30% minority, the

Times and the Union argue that "there was strong reason

for believing it was unlawful to continue following the 3:2

ratio" in light of the Supreme Court decision in Firefighters

Local Union No. 1784 v. Stotts, 467 U.S. 561, 104 S.Ct. 2576,

81 L.Ed.2d 483 (1984) (ruling that affirmative action quotas

were not without limitation). Times Brief at 18.

This Court is cognizant of the Times record but

notes, nevertheless, that the Times and the NMDU took

matters into their own hands in open disregard of the plain

language of the Settlemeni Agreement and the explicit order

of the Administrator. This they cannot do. A court order

must be obeyed. This Court hereby affirms the

Administrator’s conclusion that the Times and the Union’s

unilateral noncompliance with the 3:2 ratio set out in

Paragraph 15 constitutes a violation of the Consent Decree.

Because the Court affirmed the Administrator’s finding of a

violation of Paragraph 15 on this ground, it does not reach

the question whether consideration of sponsorship "as the

factor which determined the weight to be given to other

factors” violated the preference requirements of paragraph

15 of the /settlement Agreement.

Paragraph 29 provides in pertinent part:

Applicants for employment with any defendant

employer shall report to such office during normal

business hours to complete applications for listing on

the extra lists at a particular employer, and such

applications shall be available only at such office or

offices. The Administrator shall receive a monthly

85a

report concerning said applications.

The Administrator interpreted this paragraph as an

attempt to "establish a system for the filing of applications

which set forth qualifications of the applicant, in a central

place available to all, with procedures which afforded an

equal opportunity to all interested persons, and which

required on a standardized form a request for the type of

information that an employer interested in truck drivers and

deliverers would need." Administrator’s Determination at

48. The Administrator found, on the basis of the evidence

presented before him, that the application procedures for the

Preliminary Group III list violated Paragraph 29 the

Settlement Agreement. This Court finds no basis for

reversal of such finding.

Both the Times and the NMDU argue that the

Selection of off-list hires was not founded on racial

consideration but, rather, on the bona fide judgment of

foremen regarding past performance and/or expected

reliability of drivers. The Administrator rejected these

arguments, finding them "pretextual and not credible."

Administrator’s Determination at 55. The Administrator

further concluded that, with regard to eighteen of the

claimants, the defendants did not offer credible reasons for

their relative placement on or exclusion from the Preliminary

Group III list. the Administrator found further that

defendants failed to sustain their burden of articulating non-

discriminatory reasons for their adverse treatment of the

claimants.

This Court, upon consideration of the record and the

briefs submitted, finds no basis for concluding that the

Administrator’s decision was arbitrary or for substituting its

judgment for that of the Administrator. This Court

recognizes that the Administrator’s hearing on Claim 186

covered a period of three-and-a-half years and that

approximately 6,000 pages of testimony were taken. He has

rendered a reasoned decision that is clearly within the scope

86a

of the authority given to him by the Settlement Agreement.

it is obvious that he did not act hastily or without having

access to all of the relevant facts. While it may be argued

that these findings do not represent the only set of

conclusions which the evidence might have supported, I find

them to be reasonable and not capricious, arbitrary, or

manifestly unfair and therefore affirm that portion of the

Administrator’s Determination finding intentional

discrimination against all claimants in offlist hiring and

against eighteen claimants in the creation of the Preliminary

Group III list.®

Remedies

As the Times notes, "the formation of these lists is

not a simple task." Times Brief at 17. This Court concurs

and finds that in crafting the Second Revised Interim Group

I list in March 1990, the Administrator reconstructed as

closely as possible the status that successful claimants would

have held if the Settlement Agreement had not been violated

and racial discrimination had not occurred. Those persons

heretofore on the Second Revised Interim Group I list at the

Times shall be considered hereafter members of Group I.

The Union is directed to issue Union cards to all of the

employees on Group I. The Union is directed to give

priority numbers to the first one-fourth of the Group I list as

if they had been inducted on September 1, 1986, and to the

second half of the Group I list as if they had been inducted

on September 1, 1988.

The Times argues that any monetary relief is neither

required nor appropriate even assuming, arguendo, that

*This Court does not reach the question of whether the

Administrator ruled correctly in concluding that the evidence did not

support a finding of a pattern and practice of intentional

discrimination or of adverse impact.

87a

violations of the Settlement Agreement were committed,

because no back pay award is cognizable under the

Settlement Agreement. While Paragraph 37 established a

back pay fund in connection with the settlement of the

Patterson action, nowhere in the Settlement Agreement is

there an affirmative statement ordering back pay for

violations of the Settlement Agreement. The Times argues

that "[p]lainly the parties to the Settlement Agreement knew

how to indicate that back pay could be ordered" as a general

remedy had such been their intention. Times Brief at 107.

The Times argues that the absence of an affirmative

Statement to that effect is most telling.

It is clear that the parties to the Settlement

Agreement intended the Consent Decree to subsume alleged

violations of Title VII.” This is borne out by the language

of the Settlement Agreement providing:

The Order resolves all issues between plaintiffs and

defendants, who have agreed hereto, relating to

alleged acts and practices of discrimination by said

defendants to which the Order is directed, and with

respect to such matters, compliance with the Order

shall be deemed to be compliance with Title VII and

shall be deemed to satisfy the requirement for

affirmative action by said defendants or any of them.

The doctrines of res judicata and collateral estoppel

shall apply to all plaintiffs with respect to all issues of

law and fact and matters of relief within the scope of

the complaint or the Order.

*The provisions of the Settlement Agreement do not indicate that

plaintiffs waived their Title VII rights by agreeing to submit Title VII

claims (of the type contemplated by the Consent Decree) to the

Administrator. On the contrary, submission of such grievances is the

functional equivalent of a plenary lawsuit, since compliance with the

Consent Decree is tantamount to compliance with Title VI.

Settlement Agreement § 42. Moreover, appeals from the

determinations of the Administrtor are heard in this Court.

88a

Settlement Agreement at 1 42. This identification between

the terms of the Settlement Agreement and the requirements

of Title VII indicates the parties’ intent that discrimination

claims be remedied through the Consent Decree’s specific

enforcement procedures.

For the past sixteen years the Administrator has been

hearing and determining claims brought by NYDU members

regarding discriminatory treatment and denial of equal

opportunity within the New York newspaper industry. The

large majority of such claims have involved individuals who

were not members of the private class of plaintiffs in 73 Civ.

3058.

Until a recent federal action filed by the LDF there

have been, since the entry of the Final Order approving the

Settlement Agreement, no lawsuits filed against any

defendant alleging discrimination in the bargaining unit

represented by the NMDU. Instead, allegations of

discrimination have either been settled directly with

claimants or presented to the Administrator.

During this sixteen-year period the EEOC and the

New York State Division of Human Rights ("NYSDHR")

have forwarded to the Administrator for his exclusive

consideration almost all charges of discrimination filed by

NMDU members with these agencies. On some occasions,

such discrimination charges were not forwarded to the

Administrator because the employers settled the complaints

directly with the individuals involved, the EEOC and/or the

NYSDHR without the need for the Administrator’s

intervention.

It is clear beyond question that the judicially

approved and monitored Settlement Agreement expressly

authorized the Administrator to adjudicate claims of

discrimination. It has long been the position of this Court

that if an individual seeks to remedy a wrong contemplated

by the Consent Decree, that individual couid apply to the

89a

Administrator for relief pursuant to the Consent Decree.

Paragraph 42 provides that compliance with the Settlement

Agreement in compliance with Title VII and accords a res

judicata effect to the all issues of law and fact and matters of

relief resolved by the Administrator.” Retroactive seniority

and back pay are routinely awarded to victims of racial

discrimination in violation of Title VII. The Settlement

Agreement cannot afford complainants fewer types of relief

than are available through Title VII litigation. To hold

otherwise would deprive complaints under the Settlement

Agreement of the remedies available to them through Title

VII litigation. Accordingly, this Court concludes that the

Settlement Agreement, while not explicitly authorizing the

Administrator to award back pay, does not proscribe the

award of back pay.

The Times argues that back pay is unwarranted since

the purpose of this proceeding was to resolve the competing

claims of individuals for placement on the list and that as

such, the action was in the nature of an interpleader suit,

with the Times akin to a stakeholder. The Times argued

that it was "disinterested" in the composition of the

Preliminary Group III "so long as the personnel are

competent and its staffing requirements are satisfied." Times

Brief at 105. The Administrator rejected this argument.

Even if the Group III positions were analogized to a stake

of money or property, defendants’ roles here are not those

of stakeholders. Rather than turn the stake over to the

Court or to the Administrator, defendants issued and applied

the list in violation of both the judicial decree and the

'° The Court expresses no view as to whether the

Administrator's jurisdiction of discrimination claims within the scope

of the Consent Decree is exclusive, although it is difficult to see how

court rulings rulings in Title VII actions brought by individual

plaintiffs seeking more favored positions on the employment ladder

could fail to interfere with the intricate and delicately balanced

scheme of affirmative action established by the Decree.

90a

Administrator’s explicit order. Even if the defendants

request to the Administrator for permission to depart from

the 3/2 ratio might be construed as analogous to an

interpleader action, the interpleader rules do not allow the

stakeholder to begin an interpleader action and then

precipitously turn over the money or property to one

claimant while the court is deciding how to rule on the

interpleader.

The Supreme Court in Albemarle Paper Co. vy.

Moody 422 U.S. 405, 422, 95 S. Ct. 2362, 2373-74, 45

L.Ed.2d 280 (1975) set out the governing standard for the

award of back pay:

{BJackpay should be denied only for reasons which,

if applied generally, would not frustrate the statutory

purposes of eradicating discrimination throughout the

economy and making persons who for injuries

suffered through past discrimination.

These statutory purposes [leave] little room for the exercise

of discretion not to order reimbursement." Jd. at 417, 95

S.Ct. at 2371.

In this case, the Administrator, who heard all of the

evidence and the defendants’ arguments, determined that no

exception applies and that back pay is an appropriate and

necessary remedy for the eighteen claimants who prevailed

on claims of intentional discrimination.

The Administrator’s conclusion that back pay is an

available remedy under the Settlement Agreement is

affirmed. The Administrator is directed to hold evidentiary

hearings to determine the amount of back pay due and

owing to all of the claimants in Claim 186 but for McCargo,

Harvey, Streety, and the three non-minority intervenors.

The Administrator is further directed to hold an evidentiary

hearing for the purpose of determining the relative liability

9la

of The Times and the NMDU."!

Title VII establishes a strong presumption in favor of

an award of fees to the prevailing plaintiff. The court in

Albemarle, supra, relied upon the "strong public interest in

actions brought under Title VII to eradicate discriminatory

practices” in holding that attorneys’ fees should be awarded

to successful plaintiffs " in all but very unusual

circumstances.” 422 U.S. at 415, 95 S.Ct. at 2370. The same

right to attorneys’ fees applies where, as here, plaintiffs

prevail in a proceeding to enforce a settlement agreement.

This Court affirms that Administrator’s determination that

attorneys’ fees are recoverable under the Consent Decree

and his award of attorneys’ fees to he LDF in the instant

case.

The Administrator has not recommended that the

Times and the Union be held in contempt, finding that little

purpose would be served at this time by such a

recommendation. This Court concurs and denies the LDF’s

motion of January 21, 1991 asking the Court to refer the

issue of defendants’ criminal contempt to the United States

Attomey for investigation and determination whether to

prosecute.

"'The Court affirms the Administrator's determination that the

Times and the NMDU are jointly responsible for above-mentioned

violations of the Settlement Agreement.

The Union interprets the Administrator’s finding that the

NMDU and

This text is long and has been trimmed here. Open the source document for the complete record.