Opinion
No. C99-1227L
March 12, 2002
ORDER DENYING PLAINTIFFS' RENEWED MOTION FOR CLASS CERTIFICATION
Plaintiffs seek certification of a class of "all current and former employees whose national origin or ethnic background is from Cambodia, Vietnam, the Philippines, India, Pakistan, Afghanistan or Iran, who have been employed at Boeing's facilities in the state of Washington as salaried employees in Paycodes 2T or 4, below the level of first level manager at any time from October 12, 1996 through the present." Plaintiffs have asserted national origin discrimination claims against Boeing under Title VII and 42 U.S.C. § 1981. In particular, plaintiffs allege that defendant has delegated employment decisions to first level managers without adequate guidelines for the purpose of discriminating against Asian-Americans ("disparate treatment") and that, regardless of motivation, those employment practices have created statistically significant disparities between the compensation paid and/or retention ratings assigned to potential class members and the rest of the Boeing work force ("disparate impact"). A. Federal Rule of Civil Procedure 23(a)
As discussed in this Court's Order Denying Defendant's Motion to Strike Certain Claims Under 42 U.S.C. § 1981 (dated 5/24/01), any claims plaintiffs had under 42 U.S.C. § 1981 that arose prior to October 12, 1996, are barred by the applicable statute of limitations. Plaintiffs seek certification of a class period that coincides with their section 1981 claims, even though they acknowledge that their disparate treatment claims under Title VII run from March 4, 1999, and their disparate impact claims extend no further back than September 14, 2000 (300 days prior to the filing of Mr. Taing's EEOC charge on July 11, 2001).
Over the course of this litigation, plaintiffs have argued that they were adversely affected by defendant's practices in a number of ways, including lower initial salaries, lower raises, poor quality of assignments, fewer lead positions, fewer promotions, lower retention ratings, and more layoffs. Plaintiffs acknowledge, however, that the only clear statistical evidence of an adverse impact on potential class members arises in the context of compensation, with some equivocal data regarding the impact of retention rating/layoff decisions. See Plaintiffs' Memorandum at 30; Plaintiffs' Reply at 12.
Plaintiffs seek class certification under Fed.R.Civ.P. 23. Pursuant to Rule 23(a), members of a class may sue or be sued as representative parties if:
(1) the class is so numerous that joinder of all members is impracticable, (2) there are questions of law or fact common to the class, (3) the claims or defenses of the representative parties are typical of the claims or defenses of the class, and (4) the representative parties will fairly and adequately protect the interests of the class.
Title VII contains no special authorization for class-wide relief for private parties. Class actions brought under Title VII, "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." General Telephone Co. v. Falcon, 457 U.S. 147, 161 (1982). Each of the rule's prerequisites is considered below.
(1) Numerosity
Plaintiffs allege, and defendants do not contest, that there are over a thousand employees who fall within the proposed class. Joinder of that many parties is practically impossible. Numerosity is established.
(2) Commonality
As was the case last year, there are substantial questions raised in this litigation which, if tried separately, would have to be answered as to each potential class member. See Walters v. Reno, 145 F.3d 1032, 1045-46 (9th Cir. 1998), cert. denied, 526 U.S. 1003 (1999). Although plaintiffs' arguments blur the distinctions between disparate treatment and disparate impact (making it very difficult to determine the precise claims for which class treatment is sought), the Court finds that the following common questions of law and/or fact exist and satisfy the requirements of Fed.R.Civ.P. 23(a)(2):
a) Whether the practices used to determine compensation, promotion, and retention ratings/layoffs are so subjective that they reflect intentional discrimination against class members under the disparate treatment analysis. See, e.g., Texas Dept. of Community Affairs v. Burdine, 450 U.S. 248, 253 (1981).
b) Whether the practices used to determine compensation (and possibly retention ratings/layoffs) are so subjective that they "have effects that are indistinguishable from intentionally discriminatory conduct" under the disparate impact analysis. See, e.g., Watson v. Fort Worth Bank and Trust, 487 U.S. 977, 990 (1988).
(3) Typicality
Having revised their class and substantially narrowed its scope, the Court finds that the claims of the named plaintiffs, considered as a group, are typical of the claims of the proposed class. Contrary to defendant's argument, there is no requirement that a single plaintiff have suffered all of the injuries alleged by the class. See Griffin v. Dugger, 823 F.2d 1476, 1483 (11th Cir. 1987) (standing is satisfied if at least one named plaintiff has suffered the injury that gives rise to a particular claim), cert. denied, 486 U.S. 1005 (1988). Each national origin included in plaintiffs' proposed class has a representative, even if one named plaintiff is offered as the representative of two countries. Each challenged employment practice and each alleged injury is within the personal experience of one or more of the named plaintiffs. If the class representatives are able to prove that Boeing's decision-making practices are discriminatory, they wilt have proved that fact on behalf of the absent class members as well.
Defendant argues that the myriad factual issues that would be relevant to an individual's claim of discrimination against a particular manager or totem group preclude a finding of typicality. Plaintiffs, however, are seeking certification of a class on whose behalf they can litigate over-arching, systemic issues that are applicable to all class members, with little if any variation between individuals. The individual issues identified by defendant are, in plaintiffs' scheme, to be tried as part of this litigation but separately from the claims asserted on behalf of the proposed class. Plaintiffs seek an avenue for the class-wide determination of Boeing's intent when it vested groups of first level managers with broad discretionary power over employment decisions and an evaluation of the effects of Boeing's facially neutral decision-making practices on the proposed class. Plaintiffs have offered statistical data to show class-wide trends in the areas of compensation and possibly retention ratings/layoffs. Whether that evidence is sufficient to prove disparate treatment and/or disparate impact against Asian-Americans can be decided as to all potential class members. Defendant has offered no reason to believe that the named plaintiffs' claims on these systemic issues are likely to succeed or fail on grounds that are not applicable to the absent class members.
(4) Adequate Representation
Having identified representative individuals from each of the countries included in the proposed class, plaintiffs have satisfied one of the Court's major concerns in this case. In addition, plaintiffs have narrowed the scope of their class to two paycodes, both of which are represented by the union. The fact that not all of the named plaintiffs can adequately represent the interests of all of the absent class members is not controlling. Each absent class member will have one or more representatives with substantially similar interests and claims who will represent him or her throughout this litigation. Absent some showing that the level of dissension within this class is more than would normally be expected in a group of individuals, adequacy of representation exists.
B. Federal Rule of Civil Procedure 23(b)
Having determined that plaintiffs' proposed class satisfies the four elements of Fed.R.Civ.P. 23(a), the Court must determine whether certification is appropriate under Fed.R.Civ.P. 23(b). Plaintiffs assert that certification is proper under either Rule 23(b)(2) and 23(b)(3) or, that portions of their claims can be certified as a hybrid under both subsections. Each argument is considered in turn.
(1) Rule 23(b)(2)
Certification of a class under Rule 23(b)(2) is appropriate where "the party opposing the class has acted or refused to act on grounds generally applicable to the class, thereby making appropriate final injunctive relief or corresponding declaratory relief with respect to the class as a whole." As stated in the 1966 Advisory Committee Notes, certification under this subsection is not available in "cases in which the appropriate final relief relates exclusively or predominantly to money damages." The fact that the proposed class seeks money damages does not automatically prevent certification under Rule 23(b)(2) as long as such claims are "merely incidental" to the award of injunctive or declaratory reliefZinser v. Accufix Research Institute, Inc., 253 F.3d 1180, 1195 (9th Cir.), as amended, 273 F.3d 1266 (9th Cir. 2001) (citing Probe v. State Teachers' Retirement Sys., 780 F.2d 776, 780 (9th Cir.), cert. denied, 476 U.S. 1170 (1986)). As stated in Zinser, whether monetary damages are "merely incidental" depends on what type of relief plaintiffs primarily seek. If the relief sought in this litigation is primarily injunctive in nature, certification under Rule 23(b)(2) is appropriate. If the relief sought is predominantly monetary in nature, the class should not be certified under this subsection.
The Court agrees with plaintiffs that the definition of "incidental" set forth in Allison v. Citgo Petroleum, 151 F.3d 402, 415 (5th Cir. 1998), has not been, and is not likely to be, adopted by the Ninth Circuit.
It is clear from the "Third Amended Consolidated Class Action Complaint" and the submissions of the parties that plaintiffs seek injunctive relief in order to prevent future discriminatory hiring, compensation, promotion, and layoff decisions. Their theory of the case is that Boeing developed subjective, group-wide evaluation practices in order to discriminate against potential class members, and that such intentional discrimination must be enjoined. In the alternative, plaintiffs argue that the delegation of decision-making authority to groups of first-level managers has adversely, though unintentionally, impacted Asian-Americans to such an extent that Boeing must be required to remedy the situation. These claims apply equally to all potential class members and would justify class-wide injunctive relief should plaintiffs be able to prove them. To the extent plaintiffs are seeking punitive damages to punish Boeing for these class-wide practices, it is reasonable to view such a request as part of the injunctive award because punitive damages may, given the right circumstances, flow from the same findings that would support injunctive relief. If plaintiffs show that Boeing unlawfully discriminated against the class, the jury could calculate the amount of punitive damages which would adequately punish/deter defendant and which could then be divided equally or through simplistic formulae among the class members.
Injunctive relief and the damages that could be awarded based on the same evidence are not the only forms of relief plaintiffs seek, however. Plaintiffs have also requested money damages to make up for lost past and future wages, lost "job benefits," emotional distress, and "other harm for which they are entitled to compensation." Even if plaintiffs are able to prove their allegations regarding disparate treatment and disparate impact, whether and in what amount each plaintiff is entitled to damages as compensation for the wrongs suffered as a result of Boeing's practices must be decided individually. Plaintiffs acknowledge that some individualized inquiries are necessary, but argue that their claims for money damages are still "incidental" to their claim for injunctive relief because "the claims for injunctive relief will affect more class members and have consequences for a greater period of time than will the claims for monetary damages." Reply at 25. Specifically, plaintiffs argue that the money damages at issue are fairly minimal and that the main goal of the class representatives is to benefit all current and future employees through the issuance of an injunction.
Short of a full evidentiary hearing in which the named plaintiffs are subjected to cross-examination and their credibility is determined, ascertaining plaintiffs' "true" motivation in filing this suit is difficult. The cold facts regarding the type of damages actually requested and the remainder of the record show, however, that the money damages plaintiffs seek in this litigation are not merely incidental to the requested injunctive relief and that, absent the hope of a monetary award, this litigation probably would not have been filed. The initial claims asserted by members of the proposed class before the Equal Employment Opportunity Commission and/or this Court sought redress for defendant's allegedly discriminatory actions, with an obvious focus on obtaining compensation for the alleged wrongs. Mr. Noun's "Complaint for Employment Discrimination and Retaliation and Wrongful Discharge," filed under the above cause number is just one example. Throughout the Complaint, Mr. Nouri specifically requests at least eight types of damages, including the types of money damages sought in this case. It is not until the very last clause of the concluding "Wherefore" statement that he mentions the possibility of obtaining "other relief just and equitable including temporary and permanent restraining orders and injunctions as appropriate." It is virtually impossible to conclude, based on the early filings in this matter, that the primary form of relief sought in this litigation is injunctive.
In addition, two of the named plaintiffs, and some unspecified portion of the proposed class, are no longer working at Boeing: only an award of money damages will impact their current situation. Even if the Court were to assume that all of the potential class members will eventually work for Boeing again and would therefore benefit from injunctive relief the Court finds that the potential monetary awards at issue in this case are significant and are not "merely incidental" to the request for injunctive relief. Plaintiffs argue that the dollar amount each employee is likely to get is relatively small and "would hardly be sufficient to have lead the class representatives to risk retaliation," Reply at 25. This argument is unsupported by the facts or the reasonable inferences to be drawn therefrom. Plaintiffs' sole evidentiary basis for this assertion is that their expert has calculated that the average back pay award would be approximately $500-$700 per class member per year. Plaintiffs acknowledge, however, that this amount would be "meaningful" to individual plaintiffs. When added to the potential awards for lost future pay, lost employment benefits, emotional distress/other compensable injuries, and individual punitive damage awards, the potential money damages sought in this case are clearly significant. In fact, and contrary to plaintiffs' assertions, it was just such claims that were sufficient to prompt Mr. Noun and the other individual employees to first allege discrimination against Boeing in 1999 and 2000.
The Court finds that injunctive relief is not the primary type of relief sought in this litigation. Because plaintiffs' claims for money damages are not merely incidental to the claims for injunctive/declaratory relief, certification under Rule 23(b)(2) is not available.
(2) Rule 23(b)(3)
A class may be certified under Rule 23(b)(3) if "the court finds that the questions of law or fact common to the members of the class predominate over any questions affecting only individual members, and that a class action is superior to other available methods for the fair and efficient adjudication of the controversy." The purpose of this rule is to identify those actions in which certification as a class "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." 1966 Advisory Committee Notes. Contrary to defendant's argument, the fact that the class members may ultimately have to prove individualized damages does not necessarily defeat class certification. See 1966 Advisory Committee Notes ("[A] fraud perpetrated on numerous persons by the use of similar misrepresentations may be an appealing situation for a class action, and it may remain so despite the need, if liability is found, for separate determination of the damages suffered by individuals within the class."). The primary questions for the Court to resolve under Rule 23(b)(3) are whether the common issues predominate and whether class-wide litigation is the superior method of handling plaintiffs' claims.
Up until this point in the class certification analysis, the Court generally evaluates the class defined by plaintiffs to make sure it meets the requirements of Rule 23(a), excluding from consideration all aspects of the case for which certification is not requested. At this point, however, the balance between common and individualized issues must be considered. In this case, plaintiffs have carefully identified certain over-arching claims which may be susceptible to class-wide resolution. Plaintiffs acknowledge, however, that there are some claims, such as those alleging discrimination in promotions, that are not supported by class-wide statistical evidence and which would have to be tried on an individual-by-individual basis. Motion at 30. The same lack of class-wide statistical evidence may also require the litigation of individual claims regarding discrimination in starting salaries, quality of work, lead positions, retention ratings, and layoffs. The named plaintiffs have already reserved their right to individually litigate their promotion claims (Motion at 30), and, based on the record presented on this motion, the Court anticipates that they will also want to pursue their individual claims based on these other practices.
Faced with this situation, it appears that any attempt to litigate class-wide issues will ultimately devolve into mini-trials for each named plaintiff followed by hundreds of damage proceedings if the class claims are successful. As contemplated by both the plaintiffs and the Court, the litigation would likely proceed as follows. The named plaintiffs, on behalf of the class, would attempt to prove that Boeing delegated decision-making authority over various employment decisions as a means of discriminating against class members and/or that such delegation had an adverse, but unintentional, effect on the compensation paid, and possibly retention ratings assigned, to class members. Such class-wide claims would depend primarily on statistical evidence regarding the impact of Boeing's decisions on Asian-Americans and evidence regarding corporate management's participation in designing the challenged decision-making practices. At the same time, or in some subsequent proceeding, the named plaintiffs would put on evidence regarding their individual experiences at Boeing in an attempt to show that their managers or totem groups discriminated against them with regards to starting salaries, quality of work, lead positions, promotions, retention ratings, and layoffs. If plaintiffs were to win on all points, the Court would then have to fashion some mechanism by which the named plaintiffs could prove damages related to all of Boeing's discriminatory practices while the absent class members would have to be notified and provided an opportunity to prove damages related to the discriminatory compensation and/or retention rating systems. Although the Court believes that the sequential fact-finding outlined above can be accomplished without running afoul of defendant's constitutional rights, it is by no means a desirable way to handle any litigation.
The second prong of Rule 23(b)(3) requires the Court to consider whether "another method of handling the litigious situation may be available which has greater practical advantages" than does class certification. 1966 Advisory Committee Notes. The Court finds that the individual litigation of plaintiffs' claims may achieve many of the same goals plaintiffs hoped to obtain through class litigation while avoiding the procedural and management difficulties discussed above. To the extent the named plaintiffs seek injunctive relief related to their compensation (and possibly retention rating/layoff) claims, their individual claims may establish that these practices have disparately impacted a protected group and/or that Boeing has used their decision-making system to discriminate against Asian-Americans. In such circumstances, plaintiffs' showing would justify injunctive relief against Boeing without the need for class certification. To the extent the named plaintiffs intend to litigate other claims of disparate treatment, those claims would be litigated individually regardless of whether a class were certified for the compensation and/or retention ratings claims. Finally, in the absence of a class, the damage phase of this litigation would be limited to the named plaintiffs and could, in all likelihood, be based on the evidence presented during the liability phase without the need for a separate proceeding and/or jury.
To the extent that the four factors identified in Rule 23(b)(3) must be considered separately from the primary issues raised by that subsection, the Court finds that they do not support class certification. As shown by the fact that numerous employees filed charges with the Equal Employment Opportunity Commission alleging disparate treatment, there is (or at least was) significant interest in these allegations and some desire to individually prosecute them. In addition, there have been a number of plaintiffs who have fallen in and out of the representative group, suggesting that other individuals retain an interest in pursuing these claims. Although concentrating the litigation of plaintiffs' claims in this particular forum makes sense, the overwhelming difficulties the Court foresees in trying one or two claims on behalf of a large class while litigating various other individualized wrongs on behalf of each of the named plaintiffs appear to be insurmountable and militate against certification.
(3) Hybrid Certification
Plaintiffs have not shown that certification is appropriate under either Rule 23(b)(2) or Rule 23(b)(3). The Court declines to create a hybridized certification standard for where plaintiffs are unable to meet the existing criteria.
C. Conclusion
For all of the foregoing reasons, plaintiffs' renewed motion for class certification is DENIED. The Court finds that, were the class certified as proposed by plaintiffs, the claims for compensatory damages would dominate this litigation (Rule 23(b)(2)) and the individual claims of discrimination in areas other than compensation and possibly retention ratings would overwhelm the class-wide issues (Rule 23(b)(3)). At the very end of oral argument on February 27, 2002, however, plaintiffs' counsel expressed a willingness to further amend the complaint to ameliorate any shortcomings the Court might identify. Defendant did not have an opportunity to respond, and the Court cannot simply rewrite portions of plaintiffs' complaint, even at their invitation. If plaintiffs are indeed willing to forego their individual claims in order to avoid the problems identified in this Order, they may submit a "Fourth Amended Consolidated Class Action Complaint" and a ten page supplemental memorandum in support of class certification by 4:30 p.m. on March 22, 2002. Defendant would then have until 4:30 p.m. on Thursday, March 28, 2002, to file its ten page opposition memorandum. If plaintiffs opt to proceed with their individual claims and decide not to file a supplemental memorandum, the class allegations of the "Third Amended Consolidated Class Action Complaint" will be STRICKEN and the Court will issue an appropriate case management schedule.