Opinion ID: 2959641
Heading Depth: 2
Heading Rank: 3

Heading: the liability judgments

Text: The Plaintiffs contend that we should not review Akron’s challenges to the liability judgment either because we have already decided the issues in Howe I, or because Akron could have raised the arguments in its appeal of the promotion order, but did not. See Pls.’ Br. at 31–41. We agree. In Howe I, we noted that the district court had not yet entered a final judgment and “may yet revisit its decision regarding promotions,” and so “we review[ed] only the question of whether the district court abused its discretion in issuing the injunction and reach[ed] the merits of the case only as necessary to do so.” Howe I, 723 F.3d at 657–58. We therefore analyzed Akron’s challenges to the liability judgments to determine whether Akron was “‘likely to prevail on the merits.’” Id. at 658 (quoting Samuel v. Herrick Mem’l Hosp., 201 F.3d 830, 833 (6th Cir. 2000) (listing the four factors we consider when reviewing the propriety of a preliminary injunction)). Using this framework in Howe I, we examined Akron’s three challenges to the validity of the liability judgments. First, Akron argued that the Plaintiffs had not identified a specific employment practice that caused a disparate impact. Howe I, 723 F.3d at 658–59 (citing Grant v. Metro Gov’t of Nashville & Davidson Cnty., 446 F. App’x 737 (6th Cir. 2011)). We held that the “Plaintiffs sufficiently identified a specific employment practice.” Id. at 659. Second, Akron contended “that the district court erred as a matter of law in permitting Plaintiffs to demonstrate adverse effect by applying the ‘four-fifths rule’ to promotion rates instead of exam pass rates.” Id. at 659. Akron did not contest the validity of the four-fifths rule. See id. at 659–60. We held that the Plaintiffs could use the four-fifths rule with respect to promotion rates, and therefore the Plaintiffs had demonstrated that the promotion process had an adverse effect on African- Nos. 13-4172/13-4268/14-3352 Howe, et al. v. City of Akron Page 25 American and over-forty candidates for the rank of Lieutenant. Id. at 660. Third, Akron challenged the liability judgment in favor of the Caucasian candidates for Captain because the “Plaintiffs failed to show that [Akron] is that unusual employer who discriminates against the majority.” Id. (internal quotation marks omitted). We held that Akron had waived that argument, but we also concluded that “[e]ven if the argument had not been waived, it is far from clear that the unusual-employer requirement” is applicable in the case of a disparate-impact— rather than disparate-treatment—claim. Id. at 661. Akron argues that our holding that Akron had waived its argument that the Plaintiffs were required to prove that Akron is the “unusual employer who discriminates against the majority” was “clear error and should not be followed.” Akron Br. at 38. Akron also urges us to consider all of their challenges to the liability judgments because Howe I was a review of a preliminary injunction, and therefore was not a full review of the liability judgment. Akron Reply Br. at 8. We will not address either issue, however, because the doctrine of law of the case counsels against reconsideration of issues that have already been decided. The doctrine of law of the case provides that the courts should not “reconsider a matter once resolved in a continuing proceeding.” 18B CHARLES ALAN WRIGHT, ARTHUR R. MILLER, AND EDWARD H. COOPER, FEDERAL PRACTICE AND PROCEDURE: JURISDICTION AND RELATED MATTERS § 4478 (4th ed. 2015). “The purpose of the law-of-the-case doctrine is to ensure that ‘the same issue presented a second time in the same case in the same court should lead to the same result.’” Sherley v. Sebelius, 689 F.3d 776, 780 (D.C. Cir. 2012) (quoting LaShawn A. v. Barry, 87 F.3d 1389, 1393 (D.C. Cir. 1996)). For a prior decision to control, the prior tribunal must have actually decided the issue. WRIGHT ET AL., supra, § 4478. “A position that has been assumed without decision for purposes of resolving another issue is not the law of the case.” Id. “An alternate holding, however, does establish the law of the case.” Id. Unlike claim preclusion, the law of the case does not apply to issues that a party could have raised, but did not. Id. The law-of-the-case doctrine is a prudential practice; a court may revisit earlier issues, but should decline to do so to encourage efficient litigation and deter “indefatigable diehards.” Id. Whether a panel should treat a prior panel’s ruling on a preliminary injunction as the law of the case is tricky, however. Rulings on preliminary injunctions are generally “‘tentative Nos. 13-4172/13-4268/14-3352 Howe, et al. v. City of Akron Page 26 decision[s] on the merits,’” which “change[] the ‘incentives’ of the parties that inform their litigation strategies.” Gooch v. Life Investors Ins. Co. of Am., 672 F.3d 402, 433 (6th Cir. 2012) (quoting Bieneman v. City of Chi., 838 F.2d 962, 964 (7th Cir. 1988)). But when the appellate panel considering the preliminary injunction has issued “[a] fully considered appellate ruling on an issue of law,” then that opinion becomes the law of the case. WRIGHT ET AL., supra, § 4478.5. This case presents an unusual circumstance because we considered the issues presented in Howe I with a completely developed record; we had transcripts from a completed jury trial available for review. “[W]here the earlier ruling, though on preliminary-injunction review, was established in a definitive, fully considered legal decision based on a fully developed factual record and a decisionmaking process that included full briefing and argument without unusual time constraints,” then the law-of-the-case doctrine applies. Sherley, 689 F.3d at 782. In Sherley, the D.C. Circuit vacated a preliminary injunction in favor of the plaintiffs and remanded the case to the district court for further proceedings, after which the district court entered summary judgment in favor of the defendants. Id. at 779. The plaintiffs appealed the entry of summary judgment and offered “precisely the same argument” that the prior panel had rejected, arguing that the preliminary nature of a review of a denial of a preliminary injunction made the law-of-the-case doctrine inapplicable. Id. at 781. The D.C. Circuit held that the doctrine of law of the case prevented reconsideration of that prior holding because “[t]he time constraints and limited record” that usually make the law-of-the-case doctrine inappropriate in most cases involving preliminary injunctions were “not present.” Id. at 783. The D.C. Circuit’s conclusion is not novel; other circuits facing similar procedural issues have reached the same conclusion. See id. at 782–83 (citing Naser Jewelers, Inc. v. City of Concord, 538 F.3d 17, 20 (1st Cir. 2008) (“[T]he [law-of-the-case] doctrine applies when [the] court has previously ruled on a motion for preliminary injunction and the record before the prior panel was sufficiently developed and the facts necessary to shape the prior legal matrix were sufficiently clear.”) (internal quotation marks omitted); This That & The Other Gift & Tobacco, Inc. v. Cobb Cnty., 439 F.3d 1275, 1284–85 (11th Cir. 2006) (same); Entergy, Ark., Inc. v. Nebraska, 241 F.3d 979, 987 (8th Cir. 2001) (same); Royal Ins. Co. of Am. v. Quinn-L Capital Corp., 3 F.3d 877, 880–81 (5th Cir. 1993) (same)). We therefore join the other circuits and hold Nos. 13-4172/13-4268/14-3352 Howe, et al. v. City of Akron Page 27 that, when a court reviewing the propriety of a preliminary injunction issues a fully considered ruling on an issue of law with the benefit of a fully developed record, then the conclusions with respect to the likelihood of success on the merits are the law of the case in any subsequent appeal. In Howe I, Akron appealed the promotion of all of the Plaintiffs with the benefit of a complete record that “was sufficiently developed and the facts necessary to shape the proper legal matrix were sufficiently clear.” Naser Jewelers, 538 F.3d at 20 (internal quotation marks and bracket omitted). We “carefully considered” each argument that Akron raised as to why the Plaintiffs’ liability judgment would not be upheld on appeal and issued a reasoned judgment. Entergy, 241 F.3d at 987. We therefore conclude that the holdings of Howe I are the law of the case. That means that unless Akron provides compelling reasons to revisit those holdings, we will not address Akron’s contention that the Plaintiffs’ evidence that Akron’s promotional process adversely impacted Caucasian Captain candidates was insufficient because they did not prove that Akron is an “unusual employer.” See Howe I, 723 F.3d at 660–61. Akron has not demonstrated that “extraordinary circumstances” militate in favor of abandoning our prior holdings. Christianson v. Colt Indus. Operating Corp., 486 U.S. 800, 817 (1988). “We generally will not disturb these [holdings] unless there is ‘(1) an intervening change of controlling law; (2) new evidence available; or (3) a need to correct a clear error or prevent manifest injustice.’” Entm’t Prods., Inc. v. Shelby Cnty., 721 F.3d 729, 742 (6th Cir. 2013), cert. denied, 134 S. Ct. 906 (2014) (quoting Louisville/Jefferson Cnty. Metro Gov’t v. Hotels.com, L.P., 590 F.3d 381, 389 (6th Cir. 2009)). But there have been no intervening changes in the law since Howe I. Nor has the record changed in any way; it is exactly the same. We therefore hold that any legal error the Howe I panel made—if any at all—was neither clear nor manifestly unjust, and that the holdings of Howe I are binding on this panel.
We next consider whether Akron’s failure to challenge in Howe I the legal sufficiency of the evidence of adverse impact, the jury instructions, and the district court’s conclusion that the jury verdict was not against the manifest weight of the evidence precludes Akron from making those arguments now. In general, “question[s] that could have been but [were] not raised on one Nos. 13-4172/13-4268/14-3352 Howe, et al. v. City of Akron Page 28 appeal cannot be resurrected on a later appeal to the same court in the same case.” WRIGHT ET AL., supra § 4478.6. “Part of the price paid for the final-judgment rule is that trialcourt proceedings may be tainted by an unappealable ruling and require expensive and timeconsuming reconstruction after the opportunity for appeal finally becomes available. There is no reason to pay this price when there was an opportunity for review in the course of an appeal that was actually taken.” Id. The Plaintiffs refer to this as a “waiver,” some courts have referred to this principle as the “law of the case,”6 and others use the term “res judicata.”7 The Sixth Circuit has not defined the proper terminology to use in this situation or when it applies, and so we endeavor to define the appropriate terms and boundaries now. Res judicata bars relitigation of final judgments. Under federal common law,8 [r]es judicata has four elements: (1) a final decision on the merits by a court of competent jurisdiction; (2) a subsequent action between the same parties or their privies; (3) an issue in the subsequent action which was litigated or which should have been litigated in the prior action; and (4) an identity of the causes of action. 6 The Second Circuit has referred to the practice of refusing to consider an issue that could have been raised during the first appeal of a judgment as both “law of the case” and “waiver” in the context of successive criminal appeals: The law of the case ordinarily forecloses relitigation of issues expressly or impliedly decided by the appellate court. And where an issue was ripe for review at the time of an initial appeal but was nonetheless foregone, it is considered waived and the law of the case doctrine bars the district court on remand and an appellate court in a subsequent appeal from reopening such issues unless the mandate can reasonably be understood as permitting it to do so . . . . For similar reasons, . . . the law of the case ordinarily prohibits a party, upon resentencing or an appeal from that resentencing, from raising issues that he or she waived by not litigating them at the time of the initial sentencing. United States v. Quintieri, 306 F.3d 1217, 1229 (2d Cir. 2002) (internal quotation marks, citations, and footnote omitted). In the civil context, the Seventh Circuit held that a plaintiff’s failure to appeal an entry of summary judgment during an earlier appeal prevented a challenge to the adverse summary-judgment order on a subsequent appeal. Fed’n of Adver. Indus. Representatives, Inc. v. City of Chi., 326 F.3d 924, 929 (7th Cir. 2003). 7 For example, in United States v. Gov’t of Virgin Islands, 363 F.3d 276, 292 (3d Cir. 2004), the Third Circuit invoked the principles of issue preclusion and res judicata to hold that the defendant’s failure to appeal an order to deposit funds “barr[ed] its challenge to the deposit requirement.” 8 Federal common law governs whether the Howe I appeal precludes Akron’s claims that the liability judgments are defective because those judgments involve federal questions and federal judgments. See Taylor v. Sturgell, 553 U.S. 880, 891 (2008) (“For judgments in federal-question cases—for example, Herrick’s FOIA suit— federal courts participate in developing uniform federal rules of res judicata, which this Court has ultimate authority to determine and declare.” (internal quotation marks and alteration omitted)). Nos. 13-4172/13-4268/14-3352 Howe, et al. v. City of Akron Page 29 Rawe v. Liberty Mut. Fire Ins. Co., 462 F.3d 521, 528 (6th Cir. 2006) (internal quotation marks and alteration omitted). Howe I did not involve an appeal of a final judgment, however. Because the liability judgment was not “final,” res judicata does not bar appellate review of the liability judgments now. Nevertheless, Akron had the opportunity to litigate fully the merits of the liability judgment. Most courts apply a waiver/forfeiture principle to situations like the one presented in this case. In JGR, Inc. v. Thomasville Furniture Industries, Inc., 550 F.3d 529, 533 (6th Cir. 2008), we held that a plaintiff who did not challenge during their first appeal the jury’s finding that the plaintiffs had suffered no lost profits had “waived any right to relitigate the issue in the retrial for damages.” Our sibling circuits have used a similar approach. For example, in Lindquist v. City of Pasadena, 669 F.3d 225, 238 (5th Cir. 2012), in the plaintiffs’ first appeal, they argued that the statute at issue was facially unconstitutional, which the Fifth Circuit rejected before remanding the case to the district court. After the remand, the plaintiffs argued to the district court that the statute was unconstitutional as applied to them. Id. When the plaintiffs appealed again, the Fifth Circuit clarified that their as-applied challenge was not barred from appellate review because of the law-of-the-case doctrine; the first panel had addressed only the facial challenge, and not the as-applied challenge to the statute. See id. at 239. Instead, applying “waiver doctrine,” the Fifth Circuit held that the plaintiffs could not pursue their as-applied challenge because they could have raised that argument during the first appeal but had “waived” their as-applied challenge to the statute. Id. at 240. “Only plain error justifies departure from the waiver doctrine” in the Fifth Circuit. Med. Ctr. Pharmacy v. Holder, 634 F.3d 830, 836 (5th Cir. 2011) (internal quotation marks omitted); see also United States v. Zahursky, 668 F.3d 456, 459 (7th Cir. 2012) (“By failing to raise the issue in his first appeal, Zahursky forfeited his right to challenge the application of the pseudo-count enhancement under § 2G1.3(d), and the district court was not obligated to consider this new argument on remand.”). But see Beazer E., Inc. v. Mead Corp., 525 F.3d 255, 263 (3d Cir. 2008) (“Mead cannot now, after a remand on an unrelated issue, raise objections that it previously waived,” unless “when an intervening decision from a superior court changes the controlling law.”). Nos. 13-4172/13-4268/14-3352 Howe, et al. v. City of Akron Page 30 We believe, however, that “waiver” is an inappropriate term to use to describe the failure to litigate an issue during a prior appeal. The terms “waiver” and “forfeiture” are often misused. See WRIGHT ET AL., supra § 4478.6. In most cases, the decision not to press an argument is the result of “an unreflected failure to think about the procedural need to make a choice (forfeiture),” rather than “a conscious choice to abandon a position (waiver).” Id. Therefore, we hold that a party who attempts to raise in a second appeal an issue, which could have been raised and fully litigated in the first appeal, has forfeited the issue. We will review a new issue in a second appeal only if the party seeking review demonstrates that the error was plain. Med. Ctr. Pharmacy, 634 F.3d at 836 (holding that the waiver rule prevents consideration of an issue raised in a second appeal absent plain error). Akron has forfeited any arguments that the liability judgment is flawed that it did not raise in Howe I to challenge the Plaintiffs’ likelihood of success on the merits. Therefore, absent plain error, we will not review Akron’s challenges to the sufficiency of adverse impact, the jury instruction about the four-fifths rule, and the district court’s denial of the motion for a new trial. Akron could have—and should have—raised each of these arguments to support its assertion that the order promoting the Plaintiffs was an abuse of discretion. Had Akron asserted that these errors undermined the liability judgment, then we could have taken those arguments into consideration in Howe I. Akron chose to challenge other aspects of the liability judgment instead. We do not believe that any of the errors that Akron asserts now were plain, and therefore we affirm the liability judgments. Akron presented evidence that, under 29 C.F.R. § 1607.4(D), Akron’s promotional process had a disparate impact on protected groups. Akron challenged the reliability of the four-fifths rule and offered testimony that other statistical tests showed that Akron’s promotional process did not disparately impact protected groups. The jury listened to testimony about the strengths and weaknesses of the four-fifths rule, and concluded that, in this case, the Plaintiffs had demonstrated that the promotional process had a discriminatory effect. The Supreme Court has never said what kind of statistical evidence courts may rely on to find adverse impact. Isabel v. City of Memphis, 404 F.3d 404, 412 (6th Cir. 2005). Indeed, in Ricci v. DeStefano, 557 U.S. 557, 586 (2009), the Supreme Court indicated that a violation of the Nos. 13-4172/13-4268/14-3352 Howe, et al. v. City of Akron Page 31 four-fifths rule was prima facie evidence of disparate-impact liability, citing 29 C.F.R. § 1607.4(D). And we have used the four-fifths rule as the starting point to determine whether plaintiffs alleging disparate impact have met their prima facie burden, although we have used other statistical tests as well. See Isabel, 404 F.3d at 410. Accordingly, without more guidance from the Supreme Court, we are loath to overturn the jury’s conclusion that the Plaintiffs’ proof of disparate impact was persuasive.