Opinion ID: 411199
Heading Depth: 2
Heading Rank: 1

Heading: The State of Prior Precedent

Text: 19 1. Overruling clear precedent: Defendant argues that 28 U.S.C. Sec. 1738 constitutes the applicable precedent, and Trudy Unger thus had no basis for thinking that a state court decision would not be accorded preclusive effect. Defendant's Statement of Position at 20. That argument is a little disingenuous; the issue is whether Title VII overrides Sec. 1738. It is on this issue that Trudy Unger claims that Kremer is a sharp departure from clear prior law on which she had justifiably relied, but any clarity she sees is largely the product of wishful thinking. She claims reliance on three sources of precedent: the language of Title VII, Alexander v. Gardner-Denver, 415 U.S. 36, 94 S.Ct. 1011, 39 L.Ed.2d 147, and our decision in Batiste v. Furnco, 503 F.2d 447 (7th Cir.1974), certiorari denied, 420 U.S. 928, 95 S.Ct. 1127, 43 L.Ed.2d 399 (1975). She cannot seriously argue about the language of Title VII since it is precisely the ambiguities in the statute that the Supreme Court construed in Kremer, and while Gardner-Denver and Batiste have language broad enough to support her contention that a prior state court judgment should not preclude a federal Title VII suit, the holding in each case is much narrower. 20 In Alexander v. Gardner-Denver, the Supreme Court held that an employee's statutory right to a federal trial under Title VII may not be foreclosed by prior submission of a claim to binding arbitration under the nondiscrimination clause of a collective bargaining agreement. No state court proceeding was involved. 9 The facts thus provide no support for the proposition that a state court decision would not bar a federal Title VII suit. There is indeed language in the case that could be so construed, but upon closer examination it too fails to support plaintiff's position. For example, plaintiff cites the Supreme Court's comment that in general, submission of a claim to one forum does not preclude a later submission to another. 415 U.S. at 47-48, 94 S.Ct. at 1019. This statement appears in the context of a comparison between private arbitration and federal de novo trials; state court decisions are nowhere mentioned. Even more telling, however, is the fact that the Supreme Court in a footnote to this statement provided two examples of the principle: EEOC action is not barred by findings and orders of state or local agencies, and an individual's cause of action is not barred by an EEOC finding of no reasonable cause to believe that Title VII had been violated. 415 U.S. at 48, n. 8, 94 S.Ct. at 1019, n. 8. 21 We also cannot accept plaintiff's argument on prospectivity based on Batiste v. Furnco. Plaintiff points specifically to our statement in Batiste that: 22 We must agree with the ruling in Cooper v. Philip Morris, Inc., 464 F.2d 9 (6th Cir.1972) where the court squarely rejected the application of the doctrines of election of remedies and res judicata to Title VII actions where plaintiffs had litigated their charges to final adjudication in state proceedings. 23 503 F.2d at 450 (emphasis supplied). Admittedly there is ambiguity on the face of this statement; proceedings could refer either to state agency proceedings only or to state court proceedings as well. This Court in Unger chose to adopt the latter interpretation, but that does not dispose of the question of how Trudy Unger justifiably could have interpreted this language in 1975 when she filed suit in the Circuit Court of Cook County. 24 In Batiste v. Furnco, plaintiff's complaint was dismissed by the FEPC hearing officer. Plaintiff then filed suit in district court under Title VII and Sec. 1981. Subsequently, the full Commission reversed the hearing officer and granted relief. Defendant then appealed to the county Circuit Court, but at the time of the district court decision (and apparently during our consideration as well) the Circuit Court proceeding was still pending. 503 F.2d at 449. It appears that there was never a state court decision, and indeed the parties argued only about the preclusive effect of the FEPC proceeding (defendant also argued election of remedies). Thus while the language in Batiste could be interpreted as including state court judgments under the rubric proceedings, nothing in the case had anything to do with state court proceedings. The Court probably did not intend that specific construction of its endorsement of Cooper; if it did, the language can only be characterized as dictum. 25 The inference that in Batiste we meant to refer only to agency proceedings is strengthened by the fact that we explicitly claimed to be following Cooper v. Philip Morris, supra, on the lack of preclusive effect of state proceedings. In that case, plaintiff prevailed before the Kentucky Commission on Human Rights, and then filed a Title VII suit seeking additional relief. Neither party sought recourse to the Kentucky state courts. The district court granted summary judgment for defendant, finding the Commission judgment to be res judicata. The preclusive effect of the agency proceeding was the only issue before the Sixth Circuit, which reversed. Batiste v. Furnco thus cannot be characterized as settled precedent upon which Unger justifiably could have relied for the proposition that state court judgments do not have collateral estoppel effect for purposes of Title VII suits. 10 26 2. A case of first impression: Plaintiff Unger has a more plausible argument that Kremer is a case of first impression whose outcome was not clearly foreshadowed. As indicated above, Batiste and Alexander provide no basis for confidence that a plaintiff with an adverse state court judgment would be welcome in federal court. On the other hand, as of 1975 when Trudy Unger filed her state court suit, neither was there any case law saying that such a plaintiff could not bring a Title VII suit. Nevertheless, the Supreme Court's language in Chevron Oil still provides difficulties for plaintiff. The phrase an issue of first impression whose resolution was not clearly foreshadowed suggests the presence of an issue on which opinion differs and for which the prediction about which way the Supreme Court will turn is unclear. In 1975, when the state trial court was asked to decide this case, one could have guessed that the question of whether Title VII effected a partial repeal of Section 1738 eventually had to be decided one way or the other, but at that time there was no conflict among the circuits in need of resolution. The issue simply had not arisen. It is hard to argue reliance when plaintiff could have done no better than a coin toss in predicting how the Title VII override issue would come out. 27 At the time Kremer was decided, the question of the preclusive effect of state court judgments on Title VII suits had been considerably sharpened at the Court of Appeals level. The only square conflict between the circuits, however, was between ourselves in Unger and the Second in Kremer and Sinicropi v. Nassau Co., 601 F.2d 60 (2d Cir.), certiorari denied, 444 U.S. 983, 100 S.Ct. 488, 62 L.Ed.2d 411 (1979). A common fact pattern was present in these three cases; plaintiff had appealed an adverse state agency decision to the state courts and sought federal relief after losing in state court. The Second Circuit in Sinicropi (and the Supreme Court in Kremer ) also took pains to point out that it was plaintiff who elected to go to state court. After Sinicropi, Unger might thus have anticipated that election of remedies, if not res judicata or collateral estoppel, would create problems. 28 A different fact pattern was found in other cases reaching the Court of Appeals at about the same time. In Smouse v. General Electric Company, 626 F.2d 333 (3d Cir.1980), it was defendant, not plaintiff, who took the case to state court following a victory for plaintiff at the state agency level; the Third Circuit distinguished Sinicropi on this ground, although the panel commented that it would have rejected Sinicropi anyway on policy grounds. Similarly, the Eighth Circuit in Gunther v. Iowa State Mens Reformatory, 612 F.2d 1079 (8th Cir.), certiorari denied, 446 U.S. 966, 100 S.Ct. 2942, 64 L.Ed.2d 825 (1980), conceded the normal preclusion issue but concluded that it is our view that Title VII has created a 'special circumstance' which warrants an exception to the normal rules of preclusion. This is especially true where plaintiff did not seek state court review, but was forced to defend by [defendant's] appeal. 612 F.2d at 1085. 11 29 Thus from the perspective of either 1975 or 1982, 12 in no case reaching the Court of Appeals to which plaintiffs has drawn our attention had a plaintiff other than Trudy Unger been allowed to proceed with a federal Title VII suit after obtaining state court review of an adverse agency determination.