Court Opinion

ID: 8917885
Source: CourtListenerOpinion
Date Created: 2022-11-27 05:50:59.369845+00
Date Added: 2024-06-11T17:09:09.785017
License: Public Domain

SCHROEDER, Circuit Judge,
with whom CHOY, Circuit Judge, joins, dissenting.
I respectfully dissent from the majority’s holding that an EEOC investigation must proceed without regard to whether jurisdictional considerations bar the individual claim being investigated. The EEOC never sought such a holding from this court; the holding is without precedent, and its practical effect may well be to hinder efficient use of the EEOC’s meager investigatory resources, as well as to foster futile investigations.
I would affirm the district court’s decision that the subpoenas are not enforceable so long as a district court judgment in a private class action covers the claims under investigation as well as all similar claims of class members. The EEOC now challenges the validity of that judgment, known as the Clayton decree. While I agree with the implicit majority view that the decree itself should not be attacked in this collateral proceeding, I disagree with its ruling which artificially prolongs the investigatory process.
The majority’s decision extends the EEOC’s investigative powers beyond those authorized by the statute or the case law. Contrary to the majority’s premise, significant limits on the agency’s investigative powers do exist. For example, EEOC investigations under Title VII are limited to charges of employment discrimination that are properly filed under section 706(b). 42 U.S.C. § 2000e-5(b). The law in this circuit, as well as in the other circuits considering the question, is that the EEOC may not compel enforcement of a subpoena if the requirements of section 706 are not satisfied. EEOC v. Dean Witter Co., Inc., 648 F.2d 1334 (9th Cir.1980). See also EEOC v. K-Mart Corp., 694 F.2d 1055 (6th Cir.1982); Graniteville Co. v. EEOC, 438 F.2d 32 (4th Cir.1971).
This court also has refused enforcement of an EEOC subpoena when the charging party had not exhausted available state remedies. EEOC v. Union Bank, 408 F.2d 867 (9th Cir.1968). Union Bank is fully consistent with the Supreme Court’s recent ruling in Kremer v. Chemical Construction Corp., 456 U.S. 461, 102 S.Ct. 1883, 72 L.Ed.2d 262 (1982), which gave preclusive effect to a prior state court decision in the employee’s federal employment discrimination case.
In New Orleans Steamship Association v. EEOC, 680 F.2d 23 (5th Cir.1982), the Fifth Circuit recognized, as the majority acknowledges, that res judicata would bar enforcement of EEOC subpoenas relating to claims previously settled in Title VII class litigation. Id. at 25-26. Likewise, cases involving the NLRB, an agency with authority analogous to the EEOC, recognize that the timeliness of an unfair labor practice charge is a jurisdictional defense. See Bruce Duncan Co., Inc. v. NLRB, 590 F.2d 1304 (4th Cir.1979); NLRB v. Inland Empire Meat Co., 611 F.2d 1235 (9th Cir.1979). See also 29 U.S.C. § 160(b). The majority’s decision clashes with all of these authorities.
This circuit’s decision in Pacific Maritime Association v. Quinn, 491 F.2d 1294 (9th Cir.1974), does not support the proposition that a subpoena must be enforced regardless whether the defendant has an affirma*1433tive defense. In Pacific Maritime this court expressly assumed that timely filing of an EEOC complaint is jurisdictional, but declined to rule on the timeliness until enough information could be obtained in the course of the investigation to determine whether the violation was an isolated or a “continuing” one. Id. at 1295-97. We thus held in Pacific Maritime that the timeliness issue was not yet “ripe”; we did not hold that the issue could be decided only after the EEOC initiated formal litigation. Since in this case the information which the EEOC seeks has no bearing on the preclusion question, the preclusion issue is ripe, and Pacific Maritime supports our deciding it.
Furthermore, the cases that the majority cites in support of broad agency jurisdiction over investigations are not helpful to its position. These decisions, of course, are well established and beyond question when applied in their proper context. Beginning with Justice Jackson’s decision in Endicott Johnson Corp. v. Perkins, 317 U.S. 501, 63 S.Ct. 339, 87 L.Ed. 424 (1943), involving a Department of Labor investigation under the Walsh-Healey Act, this line of cases requires that courts enforce administrative investigations when the agency seeks information relevant to its determination, in the first instance, whether a violation of a statute within its administrative jurisdiction has occurred. See United States v. Powell, 379 U.S. 48, 85 S.Ct. 248, 13 L.Ed.2d 112 (1964); United States v. Morton Salt Co., 338 U.S. 632, 70 S.Ct. 357, 94 L.Ed. 401 (1950); Oklahoma Press Publishing Co. v. Walling, 327 U.S. 186, 66 S.Ct. 494, 90 L.Ed. 614 (1946); see also 1 K. Davis Administrative Law Treatise §§ 4:6, 4:15 (2d ed. 1978). This general principle has been applied to EEOC investigations. See EEOC v. Chrysler Corp., 567 F.2d 754 (8th Cir.1977); EEOC v. South Carolina National Bank, 562 F.2d 329 (4th Cir.1977). This circuit’s most thorough discussion of administrative authority principles is in Judge Orrick’s opinion in FMC v. Port of Seattle, 521 F.2d 431 (9th Cir.1975). In holding that the district court could not deny enforcement of an agency subpoena on the ground that the agency lacked jurisdiction of the subject matter of the investigation, Judge Orrick noted that the question was one which “we had thought settled by the Supreme Court thirty-five years ago,” id., citing Endicott Johnson Corp. v. Perkins, supra.
Judge Orrick’s holding in Port of Seattle, however, applies to the issue here only in contrast. As district judge in the present case, Judge Orrick attempted neither interference with the agency’s authority to conduct investigations for the purpose of determining statutory coverage, nor a premature consideration of the merits of a suspected violation. The district court’s holding here, that the EEOC’s subpoenas should not be enforced if res judicata would bar pursuit of the claims, does not impede the agency’s ability to carry out its functions. An early determination whether or not a procedural bar exists to obtaining any relief on behalf of a charging party is far from premature. Indeed, such a determination is not only perfectly sensible but also is in harmony with the reasoning of the Endicott line of cases, supra.
In addition to basing its holding on cases that in reality do not support it, the majority also decides an issue that the parties themselves did not wish to have decided. The EEOC never asked this court to hold that it has authority to investigate these claims in the event they are barred. This court, sua sponte at the en banc stage, raised the issue of the EEOC’s authority to investigate claims despite a procedural bar to litigation on the merits. In their briefs en banc, both parties urged this court not to decide the case on that ground. Moreover, the majority’s suggestion that the EEOC should retain investigative authority to ensure compliance with the Clayton decree is unfounded; the EEOC at all times has sought to avoid the decree, not enforce it.
The appropriate course in this case, I believe, is to decide the principal issue which the EEOC brought before this court on appeal. The EEOC argued that the Clayton consent decree should not be given preclusive effect over Title VII claims. According to its argument, all the remedies provided by Title VII are still available to the charging employees in this case because *1434the Clayton decree is no more binding on Title VII claims than is a labor arbitration pursuant to a labor contract containing a contractual non-discrimination provision. This argument, however, was based on Alexander v. Gardner-Denver Co., 415 U.S. 36, 94 S.Ct. 1011, 39 L.Ed.2d 147 (1974), a case which is inapplicable here. Gardner-Denver concerned the Title VII claim of an employee who had pursued arbitration remedies under a private collective bargaining agreement. The Supreme Court held that the employee was not barred from seeking relief under Title VII by having proceeded first under the private contractual scheme. In this case, in contrast, there is a judgment expressly encompassing the employees’ Title VII claims — not an arbitration of employees' contractual claims. The Clayton decree is under the continuing jurisdiction of the district court and provides for resolution, not waiver, of Title VII employment discrimination claims of class members.
It is also important to stress that these employees, though not representative parties in the Clayton litigation, are members of the class described pursuant to Fed.R. Civ.P. 23(c)(3). Courts have consistently held that absent class members whose interests are adequately represented are bound by the judgment. See Dosier v. Miami Valley Broadcasting Corp., 656 F.2d 1295, 1299 (9th Cir.1981); Fowler v. Birmingham News Co., 608 F.2d 1055, 1058 (5th Cir. 1979); Kemp v. Birmingham News Co., 608 F.2d 1049, 1054 (5th Cir.1979); Brown v. Vermillion, 593 F.2d 321, 322-23 (8th Cir. 1979); Grigsby v. North Mississippi Medical Center, Inc., 586 F.2d 457, 461 (5th Cir. 1978); Gonzales v. Cassidy, 474 F.2d 67, 74 (5th Cir.1973); Wren v. Smith, 410 F.2d 390, 391 (5th Cir.1969). See also Restatement (Second) of Judgments § 41, Comment e (1982); Advisory Committee Note to 1966 amendment to Rule 23, reprinted in 39 F.R.D. 98, 105 (“the judgment in a class action maintained as such to the end will embrace the class, that is, in a class action under subdivision (b)(1) or (b)(2) those found by the court to be class members”). See generally 7A C. Wright & A. Miller,' Federal Practice and Procedure § 1789 (1972). There has never been any claim of inadequate representation. Accordingly, the charging parties are members of the Clayton class, and res judicata principles apply to bar further consideration of their claims covered by the decree.
Significant questions may well exist about the extent to which a consent decree such as the one in this case should provide for individual access to an Article III court for resolution of Title VII claims. In this forum, however, we do not have enough information to make such a determination. The decree in this case clearly is aimed at compliance with Title VII and provides that plaintiffs may apply to the court in the event of alleged violations. We are told that one of the charging parties, after filing the charge with the EEOC, received “make whole” relief through the decree’s grievance procedure and that, for at least some period, the district court appointed a master to consider claimed violations. District court contempt proceedings also have occurred. But while we know that Title VII enforcement has been active, we cannot know with certainty how the decree actually has operated because, in this collateral subpoena enforcement proceeding, the record of the Clayton litigation is not before us. In this setting we can neither evaluate its operation nor modify its provisions.
In my view the proper course for the EEOC to follow if it wishes to challenge the validity of the decree itself is to apply, pursuant to the express statutory authorization contained in 42 U.S.C. § 2000e-4(g)(6), for intervention in the ongoing Clayton litigation. In that forum all concerned parties, including the employer, the EEOC and the employees can be represented and the full record made available. This procedure would accord with the principle that when a party in a later proceeding asks for relief from a judgment, such relief should be considered by means of collateral attack only where other means are unavailable. See Thaggard v. City of Jackson, 687 F.2d 66 (5th Cir.1982), cert. denied, - U.S. -, 104 S.Ct. 255, 78 L.Ed.2d 241 (1983). See also Restatement (Second) of Judgments §§ 69, 74, 78-80 (1982); IB J. Moore, *1435W. Taggart & J. Wicker, Moore’s Federal Practice ¶ 0.405[4.-l] (2d ed. 1983).
Thus, since we are ill-equipped to determine the validity of the decree, in my opinion, the only correct response to the parties’ arguments in this case is one that affirms the district court’s ruling. I would hold that because the charging parties are members of the Clayton class, res judicata principles apply to bar further consideration of their claims covered by the decree.
The majority’s failure to accord finality to this class action settlement decree creates uncertainty about the effect of all Title VII settlement agreements. This will impede the broad and creative settlement efforts which Title VII was designed to encourage.
I therefore respectfully dissent.