# Amicus Curiae Brief — General Electric Capital Corp., Dba Ge Capital v. Thiessen

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URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386009_0902%3A5

## Record

- **Collection:** Supreme Court brief
- **Document type:** Amicus Curiae Brief
- **Published:** January 1, 2002
- **Citation:** 536 U.S. 934

## Text

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FER 1 2 2002 -
re No. 01-881
IN THE
Supreme Court of the United States

GENERAL ELECTRIC CAPITAL CORP., and
MONTGOMERY WARD CREDIT SERVICES, INC.,

Petitioners,
v,
GARY A. THIESSEN,
Respondent.

On PETITION FOR A WRIT OF CERTIORARI TO THE
UNITED STATES COURT OF APPEALS FOR THE TENTH CIRCUIT

MOTION FOR LEAVE TO FILE AND BRIEF AMICUS
CURIAE OF THE UNITED STATES CHAMBER OF
COMMERCE IN SUPPORT OF PETITION
FOR A WRIT OF CERTIORARI

STEPHEN A. BOKAT ZACHARY D. FASMAN*

Rosin S. CONRAD PATRICK W. SHEA

JosHuA A. ULMAN CaRLA R. WALWORTH

NATIONAL CHAMBER LITIGATION Nea D. MOLLEN

CENTER, INC. PauL, HASTINGS, JANOFSKY
1615 H Street, N.W. & WaLKER LLP
Washington, D.C. 20026 75 East 55th Street
(202) 463-5337 New York, NY 10022

(212) 318-6000

* Counsel of Record

172315 ce

COUNSEL PRESS
(800) 274-3321 = (800) 359-6859

1

MOTION FOR LEAVE TO FILE BRIEF AMICUS
CURIAE IN SUPPORT OF PETITION FORA
WRIT OF CERTIORARI

Pursuant to S. Ct. Rule 37.2, the Chamber of Commerce
of the United States (the Chamber) moves for leave to file a
brief amicus curiae in support of the Petition for a Writ of
Certiorari to the Tenth Circuit. A copy of the proposed brief
is attached. The Chamber is filing this Motion because
Respondent has refused to consent to the filing of this brief.
In further support of this Motion, the Chamber notes the
following:

1. The Chamber is the world’s largest federation of
business companies and associations, with an underlying
membership of nearly 3,000,000 businesses and professional
organizations of every size, in every industry sector, and every
region of the country. An important function of the Chamber
is to represent the interests of its members by filing amicus
curiae briefs in cases involving issues of concern to American
business.

2. One continuing concern of the American business
community has been the proper interpretation and application
of the employment discrimination laws in general, and the
conduct of employment discrimination litigation in particular.
The Chamber of Commerce, with the consent of the parties
or the Court, has filed amicus curiae briefs in the Court in
numerous recent employment discrimination cases, including
Toyota v. Williams, 122 S. Ct. 681 (2002); Circuit City Stores
v. Adams, 532 U.S. 105 (2001); Reeves v. Sanderson
Plumbing Products, Inc., 530 U.S. 133 (2000); Sutton v.
United Air Lines, Inc., 527 U.S. 471 (1999); Burlington
Industries, Inc. v. Ellerth, 524 U.S. 742 (1998); and F aragher
v. City of Boca Raton, 524 U.S. 775 (1998).

il

3. The decision below creates and deepens significant
and mature circuit splits of authority in an area of particular
concern to the Chamber and its members — class action
employment discrimination litigation. The Tenth Circuit, in
contrast to decisions in other circuits, mandated the
application of the two-stage proof paradigm established by
the Court in Jeamsters v. United States, 431 U.S. 324 (1977),
to this case, a collective action brought under the Age
Discrimination in Employment Act, and to virtually every
other type of employment discrimination class action.
The decision below raises significant Seventh Amendment
and due process issues by mandating the continuing
applicability of a bifurcated trial procedure that was adopted
before jury trials were available in employment
discrimination class actions. The Tenth Circuit also joined
several sister circuits by precluding lower courts from
conducting any meaningful analysis of evidence proffered
by class representatives at the certification stage, claiming
that such analysis is forbidden by the Court’s decision in
Eisen v. Carlisle & Jacquelin, 417 U.S. 156 (1974).

4. In combination, the rulings below eliminate any
judicial discretion on the part of the lower courts when
determining whether to proceed with a class action, rendering
such decisions little more than formalities. They also reflect
the disarray in which the lower courts find themselves on
the most fundamental questions posed in multi-party
employment discrimination litigation. The Chamber believes
that the instant case, as well as Robinson v. Metro-North
Commuter R.R. Co., 267 F. 3d 147 (2d. Cir.), pet. for cert.
filed, 70 U.S.L.W. 3429 (2001) (No. 01-908), in which a writ
of certiorari also is being sought with the Chamber’s support,
present exceptionally significant issues in this area with great
clarity. The Chamber submits that its views on these issues
would be useful to the Court in determining whether to grant
the Petition, and in deciding the issues posed in the event
that review is granted.

il

Accordingly, the Chamber respectfully moves the Court
to grant this Motion and allow the filing of the attached brief.

Respectfully submitted,

ZACHARY D. FASMAN*

Patrick W. SHEA

CarRLA R. WALWORTH

NeAL D. MOLLEN

PauL, HASTINGS, JANOFSKY
& WALKER LLP

75 East 55th Street

New York, NY 10022
(212) 318-6000

* Counsel of Record

iv
TABLE OF CONTENTS
Page
Motion for Leave to File Brief Amicus Curiae in
Support of Petition for a Writ of Certiorari ..... i
ee ee II aoa bu hile a Coos awe WN eeew se ekns IV
Table of Cited Authorities .......ccccccecesces: vi
Interest of the Amicus ........cccccccccreccess l
I. Summary of Argument ...........-.eseeee: ]
I]. Statement of the Case .......cccccccerccess 5
Si: SEEN new west eo Grou nk dade awe oe ami 8
A. The Lower Court’s Requirement That A Class
Be Certified To Preserve A “Procedural
Advantage” Supposedly Derived From The
Court’s Decision In Teamsters Warrants
NEI usaccobce nase eben soe ease 8
1. The Decision Addresses An Issue Of
Critical Importance On Which There Is
Substantial Disagreement Among The
CONN Gir IS bk once veeceasess 8
2. The Lower Court’s Mandatory Resort To
Teamsters To Preserve A “Procedural
Advantage” For Plaintiffs Is Un-
Workable, Unfair And Unnecessary. .. -11

Contents
Page
B. The Court Should Resolve Whether A District
Court Is Required To Make Essential Findings
Of Fact At The Class Certification Stage Even
Though The Issues Overlap With The Merits
OF Tee Cee. noc ic ih es tecesses eastern 15
Comsteles nc. isda tense eee een 18

vi

TABLE OF CITED AUTHORITIES

Page
CASES
Adamson vy. Bowen,

855 F.2d 668 (10th Cir. 1988) ............... 15, 16
Allison v. Citgo Petroleum Corp.,

PISS Cote fe S. | Beery rere 4,9, 13
Amchem Products, Inc. v. Windsor,

Sa) Ue. FR8 Caprese hes ecerncsceveeteeeeee 2
Anderson v. City of Albuquerque,

690 F.2d 796 (10th Cir. 1982) ............... 15, 16
Ardrey v. United Parcel Service,

798 F.2d 679 (4th Cir. 1986) ........ re 12
Beck v. Boeing,

203 F.R.D. 459 (W.D. Wash. 2001) ........... 5
Blair v. Equifax Check Services Inc.,

181 F.3d 832 (7th Cir. 1999) ............ Pr 12
Blyden v. Mancusi, 186 F.3d 252 (2d Cir. 1999) ... 13
Burlington Industries, Inc. v. Ellerth,

Jae U.S. FUR CESSES ea banc vahat essere i

Caridad vy. Metropolitan-North R.R.,
191 F.3d 283 (2nd Cir. 1999), cert. denied,
S23 U.S. 1967 Gabber ss vi eee tae 16

vil

Cited Authorities
Page

Castano y. American Tobacco Co.,

84 F.3d 734 (5th Cir. 1996) ........- ee ee eees 13,17
Circuit City Stores v. Adams,

S39 U.S. 105 GOON) ic civcvdccwccevcersvenss i
Coates v. Johnson & Johnson,

756 F.2d 524 (7th Cir. 1985) ......- ee eee eee 12
Coopers & Lybrand v. Livesay,

E37 US. GES CASTE) cs cavesuvevvvvceevedes 15, 16
Deposit Guaranty Nat'l Bank v. Roper,

PY" gil By Ti erreee rere Tre 17
Eisen v. Carlisle & Jacquelin,

437 US. 156 (IGA) og ciccccsicsacvdndvedes ii, 3, 16
Faragher v. City of Boca Raton,

S26 US. TIS CIGGS) ov vice cecosnss ves cues sh 1
Furnco Construction Corp. v. Waters,

438 U.S. SET ISTE) oc cnecivcccecdvenswseeys 14
General Telephone Co. v. Falcon,

657 U.S. 147 (1GEZ) 2 vccccsvesceeveesss 2, 4, 15, 16
Johnston v. HBO Film-Management, Inc.,

265 F.3d 178 (3d Cir. 2001) .......-. eee ee eee 4,17

Lorrilard v. Pons,
PVRS Bey. 26. | meres ei 10

vill

Cited Authorities
Page

Love v. Turlington,

Tae Fae USGS (11 Civ. 1966) once ccccvees 17
Reeves v. Sanderson Plumbing Products, Inc.,

Pee A BO GROUD cs esccestearevercecse ees i
In re Rhone-Poulenc Rorer, Inc.,

51 F.3d 1293 (7th Cir.), cert. denied,

ek Re rere HM, 33, 37
Robinson vy. Metropolitan-North Commuter R.R. Co.,

267 F.3d 147 (2d Cir.), pet. for cert. filed, 70

RS es errr errr Ter Tere i, 3, 5,9
Rutstein v.. Avis Rent-A-Car Systems, Inc.,

211 F.3d 1228 (11th Cir. 2000), cert. denied, 121

i PO ro Seka esis a euvae ws abeede 9
St. Mary's Honor Center v. Hicks,

Pee ee NEE soc son cana vedvabounanes 14
Stastny v. Southern Bell Telegraph & Telegraph Co.,

628 F.2d 267 (4th Cir. 1980) ................ 17
Sutton v. United Air Lines, Inc.,

ge og P| errr rrr ere i
Szabo v. Bridegport Machines, Inc.,

249 F.3d 672 (7th Cir.), cert. denied, 122 S. Ct.

348 (2001) ........ PP ere rey eer T Tere 4,17

Teamsters v. United States,
See GRR ENTE 6 oui reseudcexvenceeees passim

ix

Cited Authorities
Page

Thiessen v. General Electric Capital Corp.,

267 F.3d 1095 (10th Cir. 2001), pet. for cert. filed,

70 U.S.L.W. 3410 (2001) «0... eee eee eens passim
Toyota v. Williams,

122 S. Ct. 681 (2002) .... eee rrcecreeeeecee i
In re Visa Check/Mastermoney Antitrust Litigation,

No. 00-7699, 2001 WL 1242717 (2d Cir. Oct. 17,

| AAP rr etre ee ee evens 17
Western Electric Co. v. Steen,

544 F.2d 1196 (3d Cir. 1976) «1... 02s eee eee 12, 13
Zachery v. Texaco Exploration

and Production, Inc.,

185 F.R.D. 230 (W.D. Tex. 1999) .....----5- 5

UNITED STATES CONSTITUTION
Seventh Amendment ........---+eeeeeeee i, 3, 11, i3
STATUTE
PDUS.C. SQIGD) onc cccccccccrrccecssevcers 6
RULES

RE! Co ce cssrceenenreerernsnecetee i
S&B s Serr ee 6, 7, 16, 17, 18
Fed. R. Civ. P. 23(b)(2) «0.0: ee cee cere rere eres 5
Wa es |) Pe Ata, 37

f

x

Cited Authorities
Page
SECONDARY SOURCES

Judicial Business of the United States: 2000 Report
of the Director, THOU A-4 2. cc ccc ccccvcceces 2

Judicial Business of the United States Courts:
2000 Annual Report of the Director, Table C-2 ... l

Keith R. Fentonmiller, Damages, Jury Trials and the
Class Action under the Civil Rights Act of 1991,
eee BF Siti. 1) PPePPerrrrerrerrreeee 9

Gary M. Kramer, No Class: Post-1991 Barriers to
Rule 23 Certification of Across-the-Board
Employment Discrimination Cases, 15 Lab. Law.
415 (Winter/Sprimg 2000) .....ccccccccecses 4,9, 11

Willging, Hooper & Niemic, Empirical Study Of
Class Actions In Four Federal District Courts
GPU. SINE Ae SHOE cccccctcrcsccecccses 11

DOJ Spec. Rep., Civil Rights Complaints in U.S.
District Courts 1990-1998 (January 2000) ..... l

Court Approves $192.5 Million Settlement In Race
Bias Class Action Against Coca-Cola, Daily Labor
Report (BNA) No. 127, 1-5 (July 3, 2001) ..... 2

Texaco Corp. Agrees To Spend $176 Million to Settle
Race Bias Suit, Daily Labor Report (BNA)
No. 222, D-4 (Nov. 18, 1996) ............... 2

xl

Cited Authorities

Judge Gives Final Approval to Settlement under
which Publix will pay $81.5 million, Daily Labor
Report (BNA) No. 102, D-26 (May 28, 1997) ..

Federal Court Certifies Boeing Class; Female
Employees Allege Job Disparities, Daily Labor
Report (BNA) No. 204, A-2 (Oct. 24, 2001) ....

Federal Judge Certifies Class Action In Black
Worker's Suit Against Publix, Daily Labor Report
(BNA) No. 57, A-3 (Mar. 25, 1999) .......-..

Page

l

INTEREST OF THE AMICUS

The Chamber of Commerce of the United States
(the Chamber) is identified in the preceding Motion for Leave
to File. Its interest in this matter is more completely expressed
in the preceding Motion for Leave to File and in the Summary
of Argument section below, and thus will not be restated at
further length in this section. '

I. SUMMARY OF ARGUMENT

1. Since 1991, when Congress first authorized the
recovery of compensatory and punitive damages and provided
for jury trials under Title VII of the Civil Rights Act, there
has been an explosion of employment discrimination
litigation in the federal courts. During the 1990’s, the number
of employment discrimination cases filed in the federal courts
nearly tripled,’ an increase matched by the number of
employment discrimination class actions filed annually in
the federal courts.’ There currently are 170 employment
discrimination class actions pending in the federal courts,

1. Pursuant to Sup. Ct. Rule 37.6, the Chamber affirms that
neither Petitioners nor Respondent has assisted the Chamber or its
counsel in any way (including but not limited to providing expenses)
in connection with the preparation or filing of this brief.

2. 8,413 civil rights employment cases were filed in the federal
courts in 1990; in 1998 23,375 such cases were filed. See DOJ Spec.
Rep., Civil Rights Complaints in U.S. District Courts 1990-1998,
(January, 2000), at 1-2 (concluding that “[t]he growth of civil rights
cases has been due largely to the increase in employment cases
between private parties.”). See also Judicial Business of the United
States Courts: 2000 Annual Report of the Director, at Table C-2
(reporting that 21,928 employment cases were filed in 2000).

3. See 1999 Federal Court Class Action Statistics, Class Action

Reports, Table 6 (employment class actions rose from a low of
30 filed in 1992 to 85 filed in 1998).

2

affecting the lives and livelihoods of tens of thousands of
American workers and their employers.* Many other
employment discrimination class actions are no longer
pending because they recently have been resolved through
widely reported multi-million dollar settlements, setting the
stage for additional class action litigation.°

2. Despite the substantial importance of these cases and
the profusion of new litigation, the Court has not addressed
employment discrimination class actions for two decades,
and never has opined upon how the expansion of relief, and
the availability of jury trials, affects multi-plaintiff
employment discrimination litigation. Unguided by any
recent rulings from the Court, the lower courts have failed
to deal consistently or adequately with many of the
exceptionally important legal issues that have arisen in such
large and significant cases.

3. For example, despite the Court’s specific admonition
in General Telephone Co. v. Falcon, 457 U.S. 147 (1982),
that the lower courts cannot certify a class action absent a
“rigorous analysis” to ensure that appropriate procedural
requirements have been met,° numerous appellate courts —

4. See Judicial Business of the United States: 2000 Report of
the Director, at Table X-4.

5. See generally Court Approves $192.5 Million Settlement In
Race Bias Class Action Against Coca-Cola, Daily Labor Report
(BNA) No. 127, at 1-5 (July 3, 2001); Texaco Corp. Agrees To Spend
$176 Million to Settle Race Bias Suit, Daily Labor Report (BNA)
No. 222, at D-4 (Nov. 18, 1996); Judge Gives Final Approval to
Settlement under which Publix will pay $81.5 million, Daily Labor
Report (BNA) No. 102, at D-26 (May 28, 1997).

6. 457 U.S. at 161. This admonition was repeated outside the

employment discrimination context in Amchem Products, Inc. v.
Windsor, 521 U.S. 591, 633-636 (1997).

3

including the court below — have hamstrung district judges
who have attempted to perform the required analysis by
preventing them from engaging in any meaningful factual
inquiry when deciding whether to proceed with a class action.
According to the court below, and to several sister circuits,’
virtually any analysis of facts in deciding whether to certify
a class is an improper inquiry into the merits of the case of
the sort forbidden by the Court in Eisen v. Carlisle &
Jacquelin, 417 U.S. 156 (1974), guaranteeing that mere
_ allegations made by the class plaintiffs will suffice to warrant
Class certification.

4. Similarly, the court below demanded that district
courts under its supervision apply the two-stage proof
paradigm derived from the Court’s decision in Jeamsters v.
United States, 431 U.S. 324 (1977), in virtually every
employment discrimination class or collective action.
By affording bare allegations of a pattern-or-practice of
discrimination talismanic significance, the court below
disposed of evident and troubling Seventh Amendment and
due process questions about the propriety of a bifurcated trial
procedure that was adopted by the Court under a different
statute for bench trials prosecuied by the government in a
representative capacity. The court of appeals gave no heed
to whether this model makes sense when money damages
are at issue, when the case is to be tried to a series of juries
seriatim, or where the lawsuit is an opt-in action and has no
representative character.

5. Where courts have adopted this uncritical approach
to class actions, the result has been to diminish and in some
cases al! but to eliminate the plaintiffs’ burden of proving
that a particular case is suitable for class treatment, a result

7. See, e.g., Robinson v. Metro-North Commuter R.R. Co.,
267 F.3d 147 (2d Cir.), pet. for cert. filed, 70 U.S.L.W. 3429 (2001)
(No. 01-908).

4

directly at odds with the Court’s ruling in Falcon and with
the law in several other circuits.* Certifications based upon
such questionable legal analysis have led to multi-million
dollar settlements in which employers, facing huge liabilities
and crushing legal fees following certification, have chosen
to settle rather than to fight.’

6. At the same time, in other circuits where the burden
of proof retains some rigor, class plaintiffs have attempted
to circumvent the complications attendant to trying damage
actions before juries by jettisoning any claim of absent class
members to pursue compensatory or punitive damages or, in
some instances, even trial by jury, opting instead to proceed
without full relief.'° The possibility that such a strategic

8. See, e.g., Allison v. Citgo Petroleum Corp., 151 F.3d 402,
422 (Sth Cir. 1998); Szabo v. Bridegport Machines, Inc., 249 F.3d
672, 675 (7th Cir.), cert. denied, 122 S. Ct. 348 (2001)
(“The proposition that a district judge must accept all of the
complaint’s allegations when deciding whether to certify a class
cannot be found in Rule 23 and has nothing to recommend it.”);
Johnston v. HBO Film Management, Inc., 265 F.3d 178 (3d Cir. 2001).

9. As one commentator recently observed, “[o]nce plaintiffs
obtain class certification, the defendant’s exposure, plus projected
costs of defending hundreds or thousands of individual claims, places
almost overwhelming and irresistible pressure on the defendant to
settle, regardless of the merits of the claims.” Gary M. Kramer,
No Class: Post-1991 Barriers to Rule 23 Certification of Across-
the-Board Employment Discrimination Cases, 15 Lab. Law. 415, 417
(Winter/Spring 2000). See also Fed. R. Civ. P. 23(f), Adv. Comm.
Notes (1998) (“An order granting certification ... may force a
defendant to settle rather than incur the costs of defending a class
action and run the risk of potentially ruinous liability.”).

10. Federal Court Certifies Boeing Class; Female Employees
Allege Job Disparities, Daily Labor Report (BNA) No. 204, at A-2
(Oct. 24, 2001) (attorney for class of Boeing employees noting that
the class had not requested compensatory damages to minimize

(Cont’d)

5

decision might foreclose absent class members from
obtaining full relief has led some courts to refuse to entertain
such efforts,'' while other courts have refused to allow the
recovery of back pay in certified actions where the right to
compensatory and punitive damages has been waived.'”

7. Neither class members seeking relief nor employers
facing enormous liability and huge legal fees are served by
such dramatic uncertainty in the law. Respectfully, the
Chamber submits that guidance by the Court on the impact
of trial by jury and expanded remedies upon the maintenance
and conduct of employment discrimination class actions 1s
desperately required. For reasons more fully developed below
and elsewhere, the instant case and the companion case of
Robinson v. Metro North Commuter R.R., No. 01-908, in
which a writ of certiorari also is being sought with the support
of the Chamber, are ideal vehicles for addressing these very
significant issues and bringing necessary clarity to this field.

Il. STATEMENT OF THE CASE

Respondent Gary A. Thiessen (“Respondent” or
“Thiessen”) is a former employee of Petitioners Montgomery
Ward Credit Services, Inc. (“*MWCS”) and General Electric
Capital Corp. (“GECC”). In 1996, Thiessen commenced an
age discrimination action on behalf of himself and other

(Cont'd)

certification problems under Fed. R. Civ. P. 23(b)(2)); Federal Judge
Certifies Class Action In Black Worker's Suit Against Publix, Daily
Labor Report (BNA) No. 57, at A-3 (Mar. 25, 1999) (class counsel
in suit against Publix commenting on decision to forego damages,
withdraw jury demand and strike employer's jury demand).

11. See Zachery v. Texaco Exploration and Production, Inc.,
185 F.R.D. 230 (W.D. Tex. 1999).

12. See Beck v. Boeing, 203 F.R.D. 459 (W.D. Wash. 2001).

| |

6

“similarly situated” current and former employees of
Petitioners, alleging that Petitioners had developed a “blocker
policy” that was used to identify older workers who were
“blocking” younger workers from being promoted. Thiessen
v. General Elec. Capital Corp., 267 F.3d 1095, 1100 (10th
Cir. 2001). This alleged policy purportedly included the
creation of a list of “blockers” who were targeted for various
adverse employment actions, including negative employment
evaluations, demotions and termination. /d. at 1100-01.

In 1998, the district court conditionally certified a class
of opt-in plaintiffs under the Age Discrimination in
Employment Act (“ADEA”), 29 U.S.C. § 216(b)."° Although
the opt-ins alleged disparate adverse employment actions
reaching across a number of states, the court concluded that
Thiessen’s evidence of a company-wide policy of age
discrimination rendered the opt-ins “similarly situated” for
purposes of conditional certification. /d. at 1101. The court
indicated that it would reconsider certification after
discovery. /d. at 1101-02.

After discovery, the district court decertified the class
and dismissed the opt-in plaintiffs without prejudice to any
individualized claims they might later bring. The court found
that Thiessen was not “similarly situated” to the proposed
class, because there was no evidence linking the “blocker

13. The ADEA borrows the collective action framework
Congress first adopted for the Fair Labor Standards Act (“FLSA”),
rather than the class action procedures of Fed. R. Civ. P. 23. Under
the ADEA’s opt-in procedure, individuals with claims who are
“similarly situated” can affirmatively opt in to the litigation and have
their claims heard as part of the same suit. Although the terminology
and procedures used in the FLSA vary somewhat from those
applicable under Fed. R. Civ. P. 23, as the court of appeals
acknowledged, there is little practical difference between the ADEA’s
“similarly situated” test and Rule 23’s commonality and typicality
requirements. See Thiessen, 267 F.3d at 1105.

7

policy” and the challenged adverse employment actions.
Id. at 1103-04. Further, the court determined that individual
issues would predominate at trial given the individualized
defenses asserted by defendants. /d. at 1104. Finally, the court
held that plaintiffs’ proposed two-stage trial plan, based on
Teamsters v. United States, 431 U.S. 324 (1977), would
“render individualized consideration of the claims impossible
and impose extraordinary burdens on the jury.” /d. at 1105
(citation omitted).

Respondent appealed the decertification decision and the
Tenth Circuit reversed. Relying upon Rule 23 cases in that
circuit, the court below held that the district court erred
because its decision that the plaintiffs were not similarly
situated “encompass[ed] factual issues relevant to [the
pattern-or-practice] trial” on the merits, an inquiry forbidden
at this preliminary stage of the case. /d. at 1106.

The court also held that, given the pattern-or-practice
allegation, application of the two-stage trial plan outlined in
Teamsters was mandatory, because failing to follow the
Teamsters paradigm would “effectively deprive[] plaintiffs
of [the] procedural advantage” that, “if plaintiffs were able
to establish a pattern or practice of discrimination [in the
first stage of trial], they would be entitled to a presumption
that the individual employment actions taken against them
were the result of such discrimination.” /d. at 1107.'* At the
same time, to address the manageability issues raised by the
district court, the circuit court held that in Phase I of a
bifurcated trial in which plaintiffs sought to prove the

14. The court added that “[w]Je do not hold that whenever there
is evidence of a pattern-or-practice, a class must be certified.”
Id. at 1108. But this disclaimer rings hollow given the court’s holding
that: 1) application of the Teamsters paradigm is mandatory
in a pattern-or-practice case; and 2) as a result of the need to apply
this paradigm, the requirements for-a class action are satisfied.
See id. at 1106-07.

8

existence of a pattern-or-practice of discrimination,
Petitioners would be limited in their proof to evidence
concerning “a few common defenses.” /d. Individualized
proof concerning whether the “blocker” policy had been
applied to the particular class members would be relegated
to Phase II of the trial, assuming plaintiffs had successfully
proven a pattern-or-practice. The Tenth Circuit remanded the
case to the district court, directing that the matter proceed as
a collective action. A timely petition for a writ of certiorari
followed.

Ill. ARGUMENT

A. THE LOWER COURT’S REQUIREMENT THAT
A CLASS BE CERTIFIED TO PRESERVE A
“PROCEDURAL ADVANTAGE” SUPPOSEDLY
DERIVED FROM THE COURT’S DECISION IN
TEAMSTERS WARRANTS REVIEW.

1. The Decision Addresses An Issue Of Critical
Importance On Which There Is Substantial
Disagreement Among The Courts Of Appeals.

In Teamsters v. United States, 431 U.S. 324 (1977),
the Court endorsed a bifurcated proof scheme for managing
so-called “pattern-or-practice” cases brought by the federal
government under Title VII. Although the Court specifically
observed that “not all class actions will necessarily follow
{this} model,” 431 U.S. at 360, without any further guidance
from the Court as to how and where this paradigm might
profitably be employed, the lower courts have applied this
paradigm to very different kinds of cases. Teamsters was a
government action; the courts of appeals have applied it to
cases brought by private litigants. In ZJeamsters, the
government sought injunctive and other equitable relief;
several courts of appeals have applied it to damage actions.

9

Teamsters was tried to the bench; certain courts of appeals
have tried to force-fit Teamsters into the jury trial milieu.
The court below went as far as it is possible to go with
Teamsters; it compelled the district courts it supervises to
use the framework even in ADEA collective actions, which
are brought under an entirely different statute and have no
representative character at all.

The Tenth and the Second Circuits effectively require
that their district courts apply the Jeamsters paradigm in
virtually every multi-plaintiff employment discrimination
class action. See Robinson v. Metro-North Commuter R.R.,
267 F.3d 147, 169 n.13 (2d Cir. 2001). The Fifth and Eleventh
Circuits, by contrast, have held that the Jeamsters framework
is largely unworkable when applied to large-scale class
actions where substantial damages are sought and there is a
right to trial by jury. See, e.g., Allison v. Citgo Petroleum
Corp., 151 F.3d 402, 419 (Sth Cir. 1998); Rutstein v. Avis
Rent-A-Car Systems, Inc., 211 F.3d 1228 (11th Cir. 2000),
cert. denied, 121 S. Ct. 1354 (2001). Commentators have
repeatedly questioned whether Jeamsters is applicable in
cases where damages are sought or where a jury trial is
required.'®

The substantial disagreement among the circuits is not
surprising when one recalls that the Teamsters paradigm was
developed almost 25 years ago, when damages were not
available under Title VII of the Civil Rights Act of 1964,

15. See generally Kramer, supra, note 9, at 475-76 (Teamsters
paradigm not automatically applicable in cases involving jury trials
and legal relief); Keith R. Fentonmiller, Damages, Jury Trials and
the Class Action Under the Civil Rights Act of 1991, 12 Lab. Law.
421, 441-42 (1997) (“it is questionable whether the Jeamsters
approach of bifurcating liability and damages issues is constitutional
now that Title VII affords a right to jury trial and damages.”).

10

before jury trials were held available under the ADEA,"* and
when large scale jury trials in employment discrimination
cases were essentially non-existent. The fundamental
nature of employment discrimination cases has since changed
drastically, particularly following enactment of the
Civil Rights Act of 1991, which makes damages and jury
trials generally available in disparate treatment cases. In light
of this sea change, the Court urgently needs to address the
issues arising from the attempts of lower courts, including
the Tenth Circuit, to superimpose the framework for equitable
relief endorsed in Jeamsters on this new legal landscape.

The need for review is all the more acute given the rising
tide of employment discrimination class actions noted above.
The split among the circuits presents a particularly serious
problem for Chamber members with nationwide operations,
as sophisticated class action counsel can and will engage in
forum shopping when launching a nationwide class action.
In such cases, the geographic breadth of the Second and Tenth
Circuits offers ready access to the de minimis class
certification standards recognized in Thiessen and Robinson.
The fundamentals of federal law should not depend on
geographic happenstance. There is an acute need for review
by the Court to secure uniformity of decision on this
important issue.

16. The Court first held that jury trials were available in ADEA
cases in Lorrilard v. Pons, 434 U.S. 575 (1978).

1]

2. The Lower Court’s Mandatory Resort To
Teamsters To Preserve A “Procedural Advantage”
For Plaintiffs Is Unworkable, Unfair And
Unnecessary.

By insisting that the lower courts apply the proof
paradigm derived from Jeamsters in every class action in
which a pattern-or-practice of discrimination is alleged, the
court below has created intractable legal problems that
warrant review by the Court. The ZJeamsters model cannot
be administered in a case like this without impairing a
defendant’s rights under the Seventh Amendment and the
Due Process Clause.

As the district court noted, a trial of a class action
involving as many as 30 opt-in plaintiffs will require
individualized consideration of widely varying adverse
employment actions spanning nearly ten years. See Thiessen,
267 F.3d at 1101-04. Attempting to try this multitude of
issues in a single action is usually completely unworkable.
As a consequence, once a broad-based class action is
certified, a settlement becomes mandatory; there is no
practical alternative. See Jn re Rhone-Poulenc Rorer, Inc.,
51 F.3d 1293, 1298-99 (7th Cir.), cert. denied, 516 U.S. 867
(1995) (noting the “intense pressure to settle” imposed by
the possibility of a huge judgment); Kramer, supra, note 9,
at 417. This conventional wisdom among practitioners is
confirmed by the limited empirical evidence that is available.
Diligent research has disclosed no reported case in which a
Teamsters-type action of any size was tried to the completion
of Phase II proceedings before a jury. See also Willging,
Hooper & Niemic, Empirical Study Of Class Actions In Four
Federal District Courts, at 66-67 (Fed. Judicial Ctr. 1996)
(study of all class actions terminated during a two year period
in four judicial districts reported only one certified Teamsters
class action, which settled after “protracted” proceedings).

12

To avoid the multitude of individualized claims that the
district court properly believed made this case unsuitable for
class or collective treatment, the Terith Circuit ordered a Phase
I jury trial of plaintiffs’ so-called pattern-or-practice claims
limited to the question of whether “a pattern or practice of
discrimination [existed] and whether it continued after the fall
of 1994.” Thiessen, 267 F.3d at 1107. On this critical issue, the
court intimated that Petitioners could only present evidence
concerning “a few common defenses” and would be precluded
from presenting “‘highly individualized’ defenses to each of
the incidents of individual discrimination alleged by
plaintiffs. .. .” Jd.

The most effective means of rebutting plaintiffs’ claim that
the “blocker” policy continued in effect after the fall of 1994,
however, will likely be to review individual employment
decisions that occurred after that date to demonstrate that they
were non-discriminatory. See Ardrey v. United Parcel Service,
798 F.2d 679, 683 (4th Cir. 1986) (recognizing employer’s right
to defend itself in pattern-or-practice case by proving that
individual actions were justified by non-discriminatory reasons);
Coates v. Johnson & Johnson, 756 F.2d 524, 532 (7th Cir. 1985)
(same). By precluding introduction of such highly probative
evidence at Phase I, the Tenth Circuit acted contrary to the
Court’s admonition in Jeamsters, 431 U.S. at 360 n.46 (noting
that in Phase I “[w]Je do not mean to suggest that there are any
particular limits on the type of evidence an employer may use”),
and established a procedure that will inevitably preclude the
defendant from presenting its most effective defense at the most
significant stage of the litigation, where an overbroad ordercan ~
“force a defendant to settle rather than incur the costs of
defending a class action and run the risk of potentially ruinous
liability.”'"’ This is a clear denial of due process. See Western

17. Fed. R. Civ. P. 23(f), Adv. Comm. Notes (1998).
This overwhelming pressure exists “even when the plaintiff’s
probability of success on the merits is slight.” Blair v. Equifax Check
Servs. Inc., 181 F.3d 832, 835 (7th Cir. 1999).

13

Electric Co. v. Steen, 544 F.2d 1196, 1199 (3d Cir. 1976)
(“[T]o deny [an employer] the right to present a full defense
on the issues would violate due process.”).

The Tenth Circuit’s procedure also threatens Petitioners’
jury trial rights. Under the Re-Examination Clause of the
Seventh Amendment,'® “[t]he right to a jury trial in federal
civil cases, conferred by the Seventh Amendment, is a right
to have juriable issues determined by the first jury impaneled
to hear them (provided there are no errors warranting a new
trial), and not reexamined by another finder of fact.” Rhone-
Poulenc, 51 F.3d at 1303. An employer thus has the right to
have a single jury consider all facts and evidence relevant to
the pattern-or-practice claim. See Allison v. Citgo Petroleum
Corp., 151 F.3d 402, 419 (Sth Cir. 1998) (affirming denial of
motion for class certification where potential overlap of
issues to be decided in bifurcated proceedings “implicated
significant Seventh Amendment” concerns). By asking one
jury to consider only generalized evidence concerning the
“blocker” policy and by demanding that a series of subsequent
juries consider the overlapping question of whether the policy
was ever applied to a particular class member, the lower
court’s decision strips the employer of this important
procedural protection and prevents it from presenting a
comprehensive defense to a single finder of fact. See also
Blyden v. Mancusi, 186 F.3d 252, 268 (2d Cir. 1999); Castano
v. American Tobacco Co., 84 F.3d 734, 750-51 (5th Cir. 1996).

This unfair and unworkable procedure is allegedly
justified to provide plaintiffs with a “procedural advantage”
allegedly derived from Teamsters which reduces their burden
of proof at the second stage of a bifurcated trial. But the
shifting burdens of proof outlined in Teamsters do not

18. See U.S. Const. Amend. VII (“[N]o fact tried by a jury, shall
be otherwise re-examined in any Court of the United States, than
according to the rules of the common law.”)

14

constitute a substantive right under the employment
discrimination laws. To the contrary, as the Court has
emphasized on a number of occasions, such presumptions
merely constitute possible methods of analyzing what is
always plaintiff’s fundamental burden — to prove intentional
discrimination. See St. Mary's Honor Center v. Hicks,
509 U.S. 502, 514 (1993) (observing that although the court
“may, according to traditional practice, establish certain
modes and orders of proof” such evidentiary aides do not
“substitute for the required finding that the employer’s action
was the product of unlawful discrimination.”); Furnco
Constr. Corp. v. Waters, 438 U.S. 567, 577 (1978) (stating
that the burden shifting test under McDonnell Douglas “was
never intended to be rigid, mechanized, or ritualistic. Rather,
it is merely a sensible, orderly way to evaluate the evidence
in light of common experience as it bears on the critical
question of discrimination.”).

Teamsters described an orderly mechanism for dealing
with a particular type of case. The court of appeals took this
helpful procedural tool, extended it to a type of case that
shares none of Jeamsters defining characteristics, and
transformed it into an inalienable right. Unfortunately, the
court of appeals is not alone; in the 25 years since Teamsters,
the tool has taken on a life of its own in the lower courts and
has assumed a role the Court never intended. The Court
should take this occasion to consider application of the -
Teamsters paradigm to circumstances never considered at the
time it was created.

15

B. THE COURT SHOULD RESOLVE WHETHER A
DISTRICT COURT IS REQUIRED TO MAKE
ESSENTIAL FINDINGS OF FACT AT THE CLASS
CERTIFICATION STAGE EVEN THOUGH
THE ISSUES OVERLAP WITH THE MERITS OF
THE CASE.

The district court found that this case could not proceed
as a Class action, because, inter alia, there was no common
policy linking the disparate employment actions plaintiffs
sought to challenge and there was no evidence that members
of the class had been impacted by an alleged “blocker” policy.
The Tenth Circuit reversed, concluding that although this
finding may have been necessary to determine if a class action
was proper, it overlapped with the merits of plaintiffs’ claims.
Relying on two earlier cases it had decided under Title VII,”
the court below held that fact finding at the class certification
stage is improper when the factual issues overlap with the
merits.

The Tenth Circuit’s decision is squarely contrary
to General Telephone Co. v. Falcon, 457 U.S. at 147 (1982).
In that case, the Court recognized that class certification
issues and merit issues often overlap. See id. at 160
(noting that “the class determination generally involves
considerations that are ‘enmeshed in the factual and legal
issues comprising the plaintiff’s cause of action.’”) (quoting
Coopers & Lybrand vy. Livesay, 437 U.S. 463, 469 (1978)).
Despite this overlap, the Court held that “we reiterate today
that a Title VII ciass action, like any other class action, may
only be certified if the trial court is satisfied, after a rigorous
analysis, that the prerequisites of-Rule 23(a) have been
satisfied.” 457 U.S. at 161.

19. Adamson _v. Bowen, 855 F.2d 668, 676 (10th Cir. 1988):
Anderson v. City of Albuquerque, 690 F.2d 796, 799 (10th Cir. 1982).

16

By ignoring Falcon and prohibiting findings on class
certification that overlap with the merits, the Tenth Circuit
deepened a mature split among the circuits. The Second
Circuit, for example, has also held that “[in] deciding a
certification motion, district courts must not consider or
resolve the merits of the claims of the purported class.”
Caridad v. Metro-North Commuter R.R., 191 F.3d 283, 293
(2d Cir. 1999), cert. denied, 529 U.S. 1107 (2000). The court
held that it was an abuse of discretion for the lower court to
consider the employer’s critique of statistics proffered by
the named plaintiffs in that case, recognizing that while this
critique “may prove fatal at the merits stage . . . this sort of
‘statistical dueling’ is not relevant to the certification
decision.” Jd. at 292.

In reaching these erroneous conclusions, both the Second
and Tenth Circuits have relied on a flawed reading of Eisen
v. Carlisle & Jacquelin, 417 U.S. 156 (1974).”° There, the
district court conducted a mini-trial to determine whether
plaintiffs stood a likelihood of succeeding on the merits in
order to determine which party would bear the expense of
giving notice to the class. Finding no provision in Rule 23
that could be read to authorize such a procedure, the Court
found its use improper, and added: “[N]othing in either the
language or history of Rule 23 . . . gives acourt any authority
to conduct a preliminary inquiry into the merits of a suit in
order to determine whether it may be maintained a a class
action.” Jd. at 177. The district court in Eisen, however,
determined the merits of the case frontally; it decided whether
the plaintiffs were likely to prevail on the merits in order to
decide a procedural motion that was not authorized by
Rule 23. By contrast, the Court’s subsequent decisions in
Livesay and Falcon squarely establish that a district court
may — indeed, must — determine whether the requirements

20. The court below did not expressly rely on Eisen, but its
earlier decisions in Adamson and Anderson did.

17

of Rule 23 have been met, even when that inquiry ov erlaps
with the merits. The majority of circuits have so held.2!

The question of the proper approach to fact finding on
class certification represents a critical issue that warrants
review by the Court. As the Court has noted, “{a] district
court’s ruling on the certification issue is often the most
significant decision rendered in these class-action
proceedings.” Deposit Guaranty Nat'l Bank v. Roper, 445
U.S. 326, 339 (1980). As noted above, if a class is certified,
a settlement is often compelled, even for cases that lack merit,
because continuing with litigation “run[s] the risk
of potentially ruinous liability.” See Fed. R. Civ. P. 23(f),
Adv. Comm. Notes (1998).

The issue presented by this case also has broad
applicability to cases outside the employment context.
Indeed, many of the cases that address whether a court may
make findings related to class certification that also overlap
the merits arise in such diverse areas as: the antitrust laws,
see In re Visa Check/Mastermoney Antitrust Litigation, No.
00-7699, 2001 WL 1242717 (2d Cir. Oct. 17, 2001); breach
of warranty claims, Szabo, 249 F.3d at 674-76; securities
violations, Johnston, 265 F.3d at 180; products liability
claims, Rhone-Poulenc, 51 F.3d at 1294; and mass torts,
Castano, 84 F.3d at 744.

In the Second and Tenth Circuits, the path to class
certification involves no “rigorous analysis,” only a pro forma
glance at the plaintiffs’ affidavits. Even if these affidavits
are implausible on their face and contradicted by compelling

21. See, e.g., Johnston v. HBO Film Management, Inc.,
265 F.3d 178 (3d Cir. 2001); Szabo v. Bridgeport Machs., Inc.,
249 F.3d 672, 674-76 (7th Cir. 2001); Love v. Turlington, 733 F.2d
1562, 1564 (11th Cir. 1984); Stastny v. Southern Bell Tel. & Tel. Co.,
628 F.2d 267, 274 (4th Cir. 1980).

18

evidence, the district court has no options; certification is
required. This should not be the law in any circuit. The Court
should address this recurrent issue and reemphasize that
compliance with class certification requirements must be
demonstrated, not presumed.

IV. CONCLUSION

In combination, the lower court’s two erroneous rulings
make the class certification process little more than a
formality. They also reflect the disarray in which the lower
courts find themselves on the most fundamental questions
posed in Rule 23. These problems are exacerbated by the
changes wrought by the Civil Rights Act of 1991, which at
once made employment law class actions more numerous,
the applicable law more complex, and the application of the
Court’s prior decisions less clear. As a result, the rule of law
applicable in a given case now depends upon where the
employer is located or, in the case of an employer with
nationwide facilities, on where the lawsuit happens to be
filed. The Chamber submits that this state of affairs is
untenable, and urges the Court to grant review in this case to
reestablish the ground rules applicable to employment
discrimination class actions.

Respectfully submitted,

STEPHEN A. BOKAT ZACHARY D. FASMAN*
Rosin S. ConrAD CaRLA R. WALWORTH
JosHuA A. ULMAN PATRICK W. SHEA
NATIONAL CHAMBER LITIGATION NEAL D. MOLLEN
CENTER, INC. PauL, HASTINGS, JANOFSKY
1615 H Street, N.W. & WALKER LLP
Washington, D.C. 20026 75 East 55th Street
(202) 463-5337 New York, NY 10022

(212) 318-6000

* Counsel of Record

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386009_0902%3A5. Public record. Not legal advice.