Court Opinion

ID: 7004568
Source: CourtListenerOpinion
Date Created: 2022-07-24 03:48:07.034397+00
Date Added: 2024-06-11T16:10:00.563622
License: Public Domain

REAVLEY, Circuit Judge,
dissenting:
My esteemed colleagues reverse the class action certification because, they say, the district court applied an incorrect legal standard in granting the Rule 23(b)(3) certification. I can find no legal error in that court’s excellent memorandum opinion published at 88 F.Supp.2d 663, and produced after full briefing and a three-day hearing, and following more than three years of pretrial activity. I would affirm.
The fault is said to be the lack of predominance of the class-wide discriminatory pattern claim over individual damage claims and the lack of superiority or efficiency of a class action proceeding over individual trials. The district court explained, at pages 680-83, why the claim of the 200 salaried black employees, a homogenous group who suffered similar damages from an employer’s alleged policy of intentional discrimination, predominated. And the court then explained why the class action would be far superior to individual trials in fair and efficient adjudication, the latter path tying up the court for at least 200 weeks. One wonders where these two circuit judges have acquired the expertise to fault this experienced trial judge on the management of his trials. They concede that this decision is one for his discretion.
Actually, though purporting to recognize “the essentially factual basis of the certification inquiry,” the majority pays little attention to the factual particulars of the *419case and does not address any erroneous finding in concluding that an abuse of discretion has been committed. This opinion does much more than override a district court’s judgment in a specific case. It does indeed address an error of law, and that error is seen as the granting of certification of a class where its members seek individual damages. The Fifth Circuit rule of law, if this opinion stands, is that there can be no class action where the class members seek individual personal damages beyond those incidental to a claim for equitable relief. The very same considerations and rule would apply whatever the nature of the common claim. In this respect, Rule 23 applies to Title VII as amended in 1991 as it does to any other claim. That changes Rule 23(b)(3) and departs from precedent as well as the advisory committee’s note which states that “(b)(3) encompasses those cases in which a class action would achieve economies of time, effort, and expense, and promote uniformity of decision as to persons similarly situated, without sacrificing procedural fairness or bringing about other undesirable results.”1
Twenty-four years ago the Supreme Court prescribed a different rule and model for the class action where the class claims a pattern or practice of discrimination. International Brotherhood of Teamsters v. United States.2 The trial proceeds in two or more stages. At the first stage, the plaintiffs’ “burden is to demonstrate that unlawful discrimination has been a regular procedure or policy followed by an employer or group of employers.”3 If the plaintiffs seek individual relief as victims of that practice, the case moves to the next stage to determine the consequences to the individual, where the class members are entitled to a presumption that the employer had discriminated against them.4
I.
It may be that this decision, along with Allison v. Citgo Petroleum Corp.,5 will, at this time, be treated only as a Title VII exception to Rule 23. These opinions point to the 1991 amendment as radically changing, or forbidding, class actions in Title VII cases. That is an inexplicable position, because the amendment did nothing more than allow legal damages for claimants; and that factor had been no bar to class actions in employment cases brought under 42 U.S.C. § 1981. But if this is Fifth Circuit law, only Title VII class actions for equitable relief (including back pay) remain. However, if employees are barred from a Rule 23(b)(3) class action to obtain legal damages, what is the consequence of and to a class action under Rule 23(b)(2)? Would members of the class encounter an objection of splitting their damages (between back pay and consequential damages) in their individual actions? 6 If so, they may or may not choose *420to remain in the (b)(2) class. The notice provision of Rule 23(c)(2) does not apply to a(b)(2) action, but surely these employees need to be informed of the problem. Even if there is no problem for the member of a(b)(2) class obtaining equitable relief and then pursuing legal damages in an individual action, should the employees not be informed of the fact and limits of relief in the class action? This situation raises questions of numerousness and commonality under Rule 23(a). If, after notice to the class members, simultaneous individual suits for legal damages were allowed, perhaps the class action could proceed. That legal rigmarole might please my colleagues but certainly not the trial court and those plaintiffs forced to endure the expense and delay of individual trials.
Moreover, Congress did not intend to foreclose the benefits of class action treatment to injured parties by the Civil Rights Act of 1991. The purposes of the Act were “first, to provide monetary remedies for victims of intentional employment discrimination to compensate them for resulting injuries and to provide more effective deterrence; and second, to respond to the Supreme Court’s recent decisions by restoring federal civil rights protections against employment discrimination.”7
Note that the expansion of remedies in the Civil Rights Act of 1991 to include compensatory and punitive damages only applies to employers with more than fourteen employees.8 The Act targets larger employers, yet our court interprets it to protect large employers from the formidable plaintiffs’ tool of Rule 23. If one doubts that the class action is an important tool to plaintiffs seeking redress for employment discrimination, witness the recent Coca-Cola settlement of an employee class action alleging race discrimination.9 Earlier settlements of an employee class action suit against Texaco, which the present suit followed, and one against Mitsubishi, further attest to the value of the class action to plaintiffs in employment discrimination suits.10 Because Congress chose to *421increase the remedies available to Title VII plaintiffs, our court would put an end to the substantial settlements available to Title VII plaintiffs though the class action device.
The result the majority reaches is all the more anomalous given the origins of the current Rule 23. The rule was rewritten in 1966, and subpart (b)(2) “was added ... primarily to facilitate the bringing of class actions in the civil rights area.”11 Again, if Rule 23 in its current form was written to accommodate civil rights suits, and if the Civil Rights Act of 1991 was enacted to provide additional remedies for victims of discrimination by larger employers, the very employers that a class action would target, I find it strange indeed that our court would interpret the Act to divest such victims of the class action remedy.
Today’s decision and Allison cannot be reconciled with Mullen v. Treasure Chest Casino, LLC.12 In Mullen, we affirmed a district court order certifying, under Rule 23(b)(3), a class consisting of 100 to 150 crew members aboard a casino ship who allegedly suffered respiratory illnesses caused by a defective ventilation system aboard the ship. Even though we recognized that individualized proof of causation, damages, and contributory negligence would be necessary for each class member, we held that the predominance requirement of 23(b)(3) was met, since the common issues of seaman status, vessel status, negligence, and seaworthiness met the predominance requirement of Rule 23(b)(3).13 We approved a class certification order where the district court planned to try common issues in a class trial, and individual issues of causation, damages and comparative negligence in a second phase of trials.14
Other circuits have agreed with the district court in the pending case that equitable claims can be certified under Rule 23(b)(2) and legal claims for compensatory and punitive damages can be certified under Rule 23(b)(3).15 In my view, the district court committed no legal errors in reaching its decision.
II.
The matter of punitive damages presents a particular respect in which the majority here, as well as the majority in Allison, fail to follow controlling circuit precedent. In Jenkins v. Raymark Industries., Inc.,16 this court held that punitive damages is a common question for class action resolution. Under the Jenkins bifurcated trial plan, common issues were to be tried by a class jury, and individual issues of causation, actual damages, and comparative fault were to be in later trials.17 Jenkins has not been overruled by any en banc decision of this court or any subsequent Supreme Court decision. The Supreme Court has explained that the “imposition of punitive damages is an expression of ... moral condemnation.”18 That decision is better made by addressing the harm, not necessarily the precise dollar count, done to the class.
*422The majority describes Jenkins as “binding circuit precedent,” but regards it as not controlling because of “language” in Kolstad v. American Dental Ass’n,19 and “the statutory requirement that the defendants’ intent be directed against an aggrieved individual.” Again, I am at a loss to find anything about Title VII and the amendments of 1991 that make Title VII particularly ill-suited to class action treatment. The “statutory requirement” on which the majority relies appears to be 42 U.S.C. § 1981a(b)(l), which provides that punitive damages may be recovered if the defendant engaged in discriminatory conduct “with malice or with reckless indifference to the federally protected rights of an aggrieved individual.” This provision simply sets out the mens rea requirement for the recovery of punitive damages. To read this language to prohibit a single, class-wide award of punitive damages is wholly unwarranted under the wording of the statute itself and, as discussed above, a bizarre consequence for a statute intended to expand the remedies and protections available to employees under the civil rights laws.
As for Kolstad, the Supreme Court did not there say anything to reject the notion that a single punitive damage award can, in appropriate cases, be made by a jury sitting in a class action dispute. Kolstad did not address this question. Kolstad holds that an employer can be assessed punitive damages for the acts of a managerial agent acting in the scope of his employment, but not where the discriminatory employment decisions of managerial agents “are contrary to the employer’s good-faith efforts to comply with Title VII.”20 When faced with evidence of discriminatory acts of its managerial agents, an employer’s defense that it engaged in a good-faith effort to comply with Title VII is particularly well-suited to class or subclass determination. The Court describes this defense as “whether the [defendant] had been making good faith efforts to enforce an antidiscrimination policy.”21 Whether an employer has made a good faith effort to enforce an antidiscrimination “policy,” almost by definition, is a question common to all class members’ cases where class action requirements are otherwise present, and only heightens the commonality of the claims of class members.
As discussed above, this court has recognized that personal injury cases are sometimes suitable for class action treatment. The availability of compensatory and punitive damages to Title VII plaintiffs, by virtue of the Civil Rights Act of 1991, make Title VII cases all the more similar to personal injury cases, and I fail to see any meaningful basis for the court to create a “Title VII exception” to Rule 23. If anything, the congressional purpose of expanding the protections and remedies available to Title VII plaintiffs which motivated the passage of the Civil Rights Act of 1991 weighs against the recognition of such an exception. And the common issues of federal law presented in Title VII cases make Title VII a strange body of law to exempt from the class action device. Unlike mass tort cases whose class members may come from different states, Title VII cases are not plagued by the complexities of applying the laws of different states to different class members, a central failing of the class certification in the tobacco class action we decertified.22
*423I would follow precedent, adhere to the abuse of discretion standard, and affirm.

. Fed.R.Civ.P. 23 advisory committee's note (1966 Amendment).

. 431 U.S. 324, 97 S.Ct. 1843, 52 L.Ed.2d 396 (1977).

. Id. at 360, 97 S.Ct. 1843.

. See id. at 362, 97 S.Ct. 1843; see also Lee v. Washington County Bd. of Educ., 625 F.2d 1235, 1239 (5th Cir.1980) ("Once purposeful discrimination against a class is proved, a presumption of an entitlement to back pay and individual injunctive relief arises with respect to members of that class."); Davis v. Board of Sch. Comm’rs, 600 F.2d 470, 474 (5th Cir.1979) on rehearing, 616 F.2d 893 (1980); Turner v. Texas Instruments, Inc., 555 F.2d 1251, 1255 n. 1 (5th Cir. 1977).

. 151 F.3d 402 (5th Cir. 1998).

. As a general proposition, of course, if the elements of res judicata are met, the doctrine bars all claims that were or could have been brought in an earlier action. See United States v. Shanbaum, 10 F.3d 305, 310 (5th Cir. 1994) (recognizing that "claim preclusion prohibits either party from raising any claim or defense in the later action that was or *420. could have been raised in support of or opposition to the cause of action asserted in the prior action”). This general principle extends to class actions. See Penson v. Terminal Transport Co., 634 F.2d 989, 994, 996 (5th Cir.1981) (noting "the advent of the 'hybrid’ Rule 23(b)(2) class action in which individual monetary relief for class members, typically back pay, is sought in addition to classwide injunctive or declaratory relief,” and recognizing that "[a] judgment or consent decree entered in a class action can bind the absent class member even though the member had filed a claim or instituted a personal suit before the decision in the class action”). However, Rule 23(c)(4) provides that class actions may be limited to particular issues, and courts might recognize that individual suits for compensatory damages should not be barred by a judgment in a related class action, if the court hearing the class action concluded that compensatory damages were not amenable to resolution in a class action, and chose to hear only claims for equitable relief. Cf. D-1 Enters., Inc. v. Commercial State Bank, 864 F.2d 36, 38 (5th Cir.1989) ("Essential to the application of the doctrine of res judicata is the principle that the previously unlitigated claims to be precluded could and should have been brought in the earlier litigation.”); Bogard v. Cook, 586 F.2d 399, 408-09 (5th Cir.1978) (holding that class action seeking equitable relief did not bar subsequent individual suit for damages where class action notice did not alert class members to possibility that they could seek individual damages and inclusion of individual damage claims would have made class action unmanageable).

. H.R.Rep. No. 102-40(1), at 14 (1991), reprinted in 1991 U.S.C.C.A.N. 549, 552.

. 42 U.S.C. § 1981a(b)(3).

. See Betsy McKay, Coca-Cola Agrees to Settle Bias Suit for $192.5 Million, Wall St. J., November 17, 2000, at A3.

. See Darryl Van Duch, Following Trend, Coke Brings in Bias Monitors, New York L. J., June 14, 2001, at 5 (discussing $176.1 million Texaco settlement, $34 million Mitsubishi settlement, and $192.5 million Coca-Cola settlement).

. 7A Charles Alan Wright et al. Federal Practice and Procedure § 1775 (2d ed.1986).

. 186 F.3d 620 (5th Cir.1999), cert. denied, 528 U.S. 1159, 120 S.Ct. 1169, 145 L.Ed.2d 1078 (2000)

. Id. at 626-27.

. Id. at 623.

. See Jefferson v. Ingersoll Int'l, Inc., 195 F.3d 894, 898 (7th Cir.1999); Eubanks v. Billington, 110 F.3d 87, 96 (D.C.Cir.1997).

. 782 F.2d 468 (5th Cir. 1986).

. Id. at 471.

. Cooper Indus. v. Leatherman Tool Group, Inc., 532 U.S. 424, 121 S.Ct. 1678, 1683, 149 L.Ed.2d 674 (2001).

. 527 U.S. 526, 119 S.Ct. 2118, 144 L.Ed.2d 494 (1999).

. Kolstad, 527 U.S. at 545, 119 S.Ct. 2118 (internal quotation marks omitted).

. Id. at 546, 119 S.Ct. 2118.

. Castano v. American Tobacco Co., 84 F.3d 734, 741-44, 747 (5th Cir.1996).