Class Actions in Employment Law: How to File and Defend a Class Action-Plaintiff's Perspective

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1 PRESENTATION FOR THE ABA LABOR AND EMPLOYMENT LAW SECTION 1999 ANNUAL MEETING: ATLANTA, GA AUGUST 10, 1999 CLASS ACTIONS IN EMPLOYMENT LAW: HOW TO FILE AND DEFEND A CLASS ACTION PLAINTIFFS PERSPECTIVE DAVID BORGEN 1 SAPERSTEIN, GOLDSTEIN, DEMCHAK & BALLER 1300 CLAY STREET OAKLAND, CA / borgen@sgdblaw.com I. INTRODUCTION Employment class actions under both Rule 23 and analogous state law provisions will continue to play a central role in the enforcement of fair employment laws. While new developments such as FRCP 23(f) (interlocutory appeal of class certification) and Allison v. Citgo Petroleum Corp., 151 F.3d 402 (5th Cir. 1998), per curiam opinion denying rehearing en banc, 151 F.3d 434 (5th Cir. 1998), present new challenges to plaintiffs seeking Title VII class certification, class actions will continue to be essential to the enforcement of employees civil rights. This paper will touch on some of the critical issues and recent developments facing plaintiffs in filing and litigating the employment class action. II. RECENT CLASS CERTIFICATION CASES Courts have continued to certify Title VII class actions in the face of defense arguments that (a) the availability of compensatory and punitive damages under the Civil Rights Act of 1991 preclude certification and (b) that the decentralized nature of modern business operations defeat certification. Given the critical importance of class actions in the effective enforcement of anti-discrimination legislation, it is unlikely that either of the defense bar s current arguments will survive. Recent examples of Title VII classes certified include: 1. Gaines v. Boston Herald, Inc., 998 F. Supp. 91, 76 FEP Cases (BNA) 1429 (D. Mass. 1998). The court certified a class of African-American and Spanish-surnamed applicants for unskilled positions at the Herald. The employer s nepotistic policies, where there is an overwhelming white workforce, supplied the basis for meeting typicality and commonality requirements. This analysis applies to claims under either adverse impact or disparate treatment theories. The court found that Gaines, an African-American, could represent both African- Americans and Spanish-surnamed applicants because there is no meaningful distinction (in the application of the policy), either in its motivation or its effect, between members of different 1 David Borgen is a partner with Saperstein, Goldstein, Demchak & Baller in Oakland, California.Mr. Borgen gratefully acknowledges the contributions of his partner, Barry Goldstein, in the preparation of this paper. 1

2 minority groups. But the Court found that Gaines, an actual applicant, may not represent deterred applicants, because his claims are not typical of the claims of deterred applicants. 2. Butler v. Home Depot, 70 FEP Cases (BNA) 51 (N.D. Cal. 1996). The court certified a class of female employees or former employees of Home Depot's stores in its Western Division as well as female applicants to these stores who were qualified for salesperson or assistant manager positions and who were not hired or were hired into other positions. The court also bifurcated the action into separate stages. The first stage would have covered liability and relief applicable to the class as a whole, including injunctive and declaratory relief, and whether Home Depot was liable for punitive damages. If liability was found, then the second stage would include the right of class members to individual relief. The commonality requirement was met by, among other common questions, whether the plaintiffs can meet their burden of proof that under either the disparate treatment or impact theories that Home Depot's subjective decision-making practices violate fair employment laws. Also, the "allegation that the defendant maintains a policy and practice of denying women equal employment opportunities is sufficient to satisfy the Rule 23(b)(2) requirement." Thus, the "first, liability phase of this case is appropriate for certification under Rule 23(b)(2)." The court deferred ruling "on class certification with respect to the second phase of the trial." The action settled in September Shores v. Publix Super Markets, 69 EPD 44,477 (M.D. Fla. 1996). The court certified a class of all female management and non-management employees of Publix Super Markets, who from 1991 to the date of trial have worked, are working, or will work in Publix's retail operations. The certified class covered approximately 100,000 persons who worked or had worked in about 500 retail stores in three states. The commonality requirement was satisfied by plaintiffs' evidence and allegations showing a strict promotion-from-within policy; by plaintiffs' "lengthy and detailed" statistical proffer showing "gender segregated jobs"; and by Publix's centralized practices, including handbooks, procedures for filling vacancies, and rotation of employees around the company. The court, at this "preliminary stage," "discounted" Publix's argument that "gender segregation is the result of self selection" because "Publix does not post job openings" but rather "relies on the `tap on the shoulder' system in which managers subjectively determine which of their employees should be chosen for the position." Also, the court determined that plaintiffs' "claim of disparate impact is, by its very nature, a class claim presenting a common issue of law." "The Court concurs with Plaintiffs' position that injunctive relief and damage claims are intertwined." Accordingly, the "Court finds that a hybrid Rule 23(b)(2) class is the appropriate mechanism for the resolution of this case... A hybrid class consists of two stages. In Stage I, the Court resolves the issue of liability under the procedures of Rule 23(b)(2), and the issue of damages is resolved in Stage II using the `opt out' procedure established for Rule 23(b)(3) actions." The court reserved its decision as to "how claims for punitive damages will be handled." 2 2 In addition to Butler and Shores, two fairly recent district court opinions have adopted a bifurcated approach to liability and remedy issues where there were substantial claims for damages. Morgan v. United Parcel Service of America, 169 F.R.D. 349 (E.D.Mo. 1996); see 2

3 4. Griffin v. Home Depot, 168 F.R.D. 187, 70 FEP Cases (BNA) 1678 (E.D. La. 1996). The court denied the defendant's motion to dismiss the class allegations in the complaint. The complaint was filed on behalf of a class of women in Home Depot's Southeast, Northeast, Midwest and Midsouth Regions who alleged that they had been denied employment, promotions, compensation and other opportunities because of their gender. The court concluded that it agreed with Butler (and rejected the district court s opinion in Allison) "that the 1991 amendments, giving victims of gender discrimination greater remedies, do not preclude the possibility of a class action... Such a finding is not supported by the legislative history of the amendments nor logical in light of Congress' intent." The court found that certification pursuant to Rule 23(b)(2) was not appropriate because the predominant relief sought was monetary, not injunctive. The court agreed with Butler (and rejected the district court s opinion in Allison) "that a case such as this one can be managed as a class action," and therefore could be certified pursuant to Rule 23(b)(3). 5. Israel v. Avis Rent-A-Car Systems, Inc., 185 F.R.D. 372, 1999 WL (S.D. Fla. 1999) While this is not an employment case, this case is significant in that it certifies a class of Jewish persons and businesses discriminated against by Avis on the basis of religion under 42 U.S.C The district court approved a Rule 23(b)(3) class on the basis that the facts here (including of documentation of a corporate policy to discriminate by denying Jews and Jewish organizations certain corporate discounts) differed substantially from the decentralized anecdotal evidence that failed in Jackson v. Motel 6 Multipurpose, Inc., 130 F.3d 999 (11th Cir. 1997) McClain v. Lufkin Industries, Inc., 1999 WL (E.D. Tex. 1999) Race discrimination class certified under Rule 23(b)(2) where claim based solely on disparate impact of subjective employment practices. The district court found that the injunctive relief requested predominated over the monetary relief claims. The court severed the named plaintiffs individual claims for compensatory and punitive damages, it appearing that none were pleaded for the class. Bonds v. District of Columbia, 93 F.3d 801 (D.C. Cir. 1996). (This decision reversed and remanded the finding of liability in a bifurcated proceeding before Judge Royce Lamberth. The class proceeding concerned sexual harassment claims against the Department of Corrections. The D.C. Circuit reversed and remanded because the district court had imposed too severe a discovery sanction by excluding certain defense evidence.) 3 Note that the Eleventh Circuit has granted the defendant s petition to permit a Rule 23(f) appeal in this action, the first such grant of appellate review known to the author as of the date this paper was admitted to the ABA. No decision has been reached on appeal. See Part V, below, regarding Rule 23(f) appeals.. 3

4 7. Morgan v. United Parcel Service of American, Inc., 169 F.R.D. 349 (E.D. Mo. 1996) Race discrimination claims certified with court expressly rejecting defense argument that decentralized decisionmaking defeats certification of the class. The court based its ruling on the uniform personnel policies found to include subjective and decentralized decisionmaking. 8. Orlowski v. Dominick s Finer Foods, Inc., 172 F.R.D. 370 (N.D. Ill. 1997) Gender class certified under Rule 23(b)(2), expressly rejecting analysis of Celestine v. Citgo Petroleum, 165 F.R.D. 463 (W.D. La. 1995), ruling that in this context the injunctive relief requested predominates; also rejecting Seventh Amendment theory that bifurcated jury trial not permitted. 9. Carter v. West Publishing Company, 79 F.E.P. Cases (BNA) 1494, 1999 U.S. Dist. LEXIS 8231 (M.D. Fla. May 20, 1999) This is the most recent Title VII class certification opinion that the author was aware of at the time this paper was submitted. The district court certified the gender discrimination claims of 144 current and former female employees of the legal publishing company who were denied shares of stock on an equal basis as the male employees. Certification under Rule 23(b)(2) was not requested as the alleged practice had ceased and the matter was certified under Rule 23(b)(3). The court rejected the Motel 6 approach (focussing rather on the discriminatory policies rather than the facts of each anecdote of discrimination) and Allison: In short, this court recognizes the potential problems with the individualized proof necessary to establish compensatory and thereafter perhaps punitive damages in the context of class certification. Nevertheless, even after the 1991 amendments to the Civil Rights Act, this Court finds it difficult to imagine that a bright-line rule applies to deny a district court the discretion to grant class certification under Rule 23(b)(3) in every Title VII case in which the plaintiffs seek compensatory and punitive damages and a jury trial. (Slip opn. at 18)(for more regarding Allison, see below) Battle v. White Cap, Inc., 1999 WL (N.D. Ill. 1999) Title VII and 1981 race discrimination claims of African-American hourly employees at Chicago facility challenging disciplinary policies is certified pursuant to Rule 23(b)(2) because plaintiffs sought injunctive relief. 4 Defendants petition for an interlocutory appeal pursuant to Rule 23(f) is pending at the time this paper was submitted. 4

5 III. IMPACT OF ALLISON V. CITGO PETROLEUM Since shortly after the passage of the Civil Rights Act of 1991, defendants have routinely argued that class certification is no longer available in Title VII cases in which plaintiffs seek compensatory and punitive damages. This argument has been given some (now diminished) currency with the Fifth Circuit s Allison decision. 5 While a Key-Citing of Allison demonstrates that it has not been widely cited outside of the Fifth and Eleventh Circuits, it is discussed at some length below as plaintiffs counsel may expect the defense bar to continue to raise this issue for the indeterminate future. 6 The Fifth Circuit took this case on interlocutory appeal from a decision denying a motion to certify a class of African American employees, see, Celestine v. CITGO Petroleum Corp., 165 F.R.D. 463 (W.D. La. 1995), who were claiming race discrimination in violation of Title VII and 42 U.S.C. 1981, at the manufacturing facilities in Lake Charles, Louisiana, of CITGO Petroleum Corporation. The plaintiffs alleged that CITGO engaged in class-wide discrimination with regard to hiring, promotion, compensation and training practices. These practices were challenged under both disparate impact and systemic disparate treatment theories. After a convoluted set of opinions, the Fifth Circuit affirmed the lower court. It is important to understand the very unusual appellate history of this case. Counting the dissent, there have been four opinions issued at different times over a five-month period. The first decision, which was issued on May 15, 1998, 7 was a majority opinion affirming the denial of class certification. The majority, Judge E. Grady Jolly and Judge Jerry Edwin Smith, issued this opinion without waiting for the drafting of the dissenting opinion by Judge James L. Dennis. On June 2, 1998, the dissenting opinion by Judge Dennis was issued. 8 On June 4th, the plaintiffs filed a Suggestions for En Banc Consideration. 9 The plaintiffs received a copy of the dissenting opinion by Judge Dennis on the same day that they had to file their Suggestions for En 5 Allison v. CITGO Petroleum Corp., 151 F.3d 402 (5th Cir.), per curiam opinion denying rehearing en banc, 151 F.3d 434 (5th Cir. 1998). 6 Note that the reasoning in Allison has been explicitly rejected in Orlowski v. Dominick s Finer Foods, Inc., 172 F.R.D. 370 (N.D. Ill. 1997), the West Publishing case cited above, and in Stewart v. Rubin, 948 F. Supp. 1077, 1090 (D.D.C. 1996). 7 This opinion is unofficially reported, 76 FEP Cases (BNA) 1643 (5th Cir. 1998). In its reprint of the decision, BNA omitted without explanation the last footnote of the opinion: Judge Dennis DISSENTS, reserving the right to submit reasons at a later date. 8 The dissenting opinion is unofficially reported at 76 FEP Cases (BNA) 1643 (5th Cir. 1998). The BNA reported decision gives the appearance, which is inaccurate, that the majority and dissenting opinions were issued, as is customary, at the same time. 9 The firm of Saperstein, Goldstein, Demchak & Baller entered a limited appearance in the case in order to prepare and file the Suggestions. The EEOC, Lawyers Committee for Civil Rights Under Law and NELA filed briefs amici curiae. 5

6 Banc Consideration. While plaintiffs were not able to review Judge Dennis dissenting there was a considerable overlap between the Suggestion and the dissenting opinion. On August 18, 1998, the third opinion was issued. The majority opinion issued a substitute opinion withdrawing its earlier opinion. In this opinion, the majority buttressed arguments in light of the criticisms raised in the dissenting opinion and the Suggestions. The majority also removed an extraordinary reference that it had made to one of the seminal Title VII decisions rendered by the Fifth Circuit, Pettway v. American Cast Iron Pipe Co., 494 F.2d 211 (5th Cir. 1974). The majority referred to Pettway as an exception to our rule permitting any incidental damages in (b)(2) class actions. 10 In the August 18th substituted opinion the majority attempts to distinguish Pettway and its progeny, rather than explicitly stating, in effect, that it was creating another rule. (Obviously, the original reference by the majority to Pettway was an implicit invitation to rehearing by the entire court.) In light of the substituted opinion, the plaintiffs Suggestion was dismissed as moot. On September 8, 1998, the plaintiffs filed a second Suggestion for En Banc Consideration. On October 2, 1998, the court issued a Per Curiam decision denying the petition for rehearing and for en banc consideration. In denying rehearing, the panel majority makes the following observations: The trial court utilized consolidation under rule 42 rather than class certification under rule 23 to manage this case. We review that decision for abuse of discretion and we find no abuse in this case. We are not called upon to decide whether the district court would have abused its discretion if it had elected to bifurcate liability issues that are common to the class and to certify for class determination those discreet liability issues. One reasonable interpretation of this short opinion is that the resolution of the appeal is not very important. According to this per curiam decision, the lower court simply decided to use Rule 42 and consolidation rather than Rule 23 and class treatment. It is puzzling that, if this were the Court s view, why it did not discuss or even mention Rule 42 in the legal discussion in either the May 15th or August 18th opinion but rather wrote, at length, on Rule 23. A more cynical interpretation is that the majority did not want the case heard en banc. In light of the dissenting opinion and the arguments in the Suggestion, the majority agreed to a modification, in effect, of the legal basis for its decision in order to avoid en banc consideration. While the precedential value of Allison is considerably diminished by the subsequent history described above, its analysis will continue to be debated by employment lawyers for some time to come. Therefore, it is presented below in some detail. Allison opines that before the passage of the Civil Rights Act of 1991, which for the first time provided plaintiffs with a right to compensatory and punitive damages as well as a jury trial (each demanded here), aspects of this case clearly would have qualified for class certification. The court concluded that the plaintiffs claim for money damages and the constitutional right of both parties to a jury trial, with all its substantive rights and procedural complications, ultimately render their case unsuitable for class certification under Rule 23. We therefore hold that the district court did not abuse its discretion in denying class certification. The court acknowledged that [i]n years past, we have routinely upheld certification of class actions to resolve Title VII cases involving 10 As both Judge Dennis and the Suggestions pointed out, Pettway is hardly an exception. 6

7 disparate impact and pattern or practice claims of discrimination. The court further admitted that [i]n doing so, we have recognized that the class action device could be implemented effectively to eradicate widespread or institutional-scale discrimination. But, the court stated, the CRA of 1991 made fundamental changes in both the procedures and remedies available to Title VII litigants. The court reviewed the extent these factors [monetary damages and jury trial] affect the application of the class action rule in this case. In effect, the court determined that as a result of the CRA of 1991, the district court had discretion to determine that class certification was inappropriate in Title VII cases such as this one. Initially, the court addressed the principal argument advanced by the plaintiffs: that the lower court should have certified the case pursuant to Rule 23(b)(2). The Fifth Circuit examined whether the district court erred in determining that the primary limitation on a Rule 23(b)(2) class action is the requirement that injunctive or declaratory relief be the predominant relief sought for the class. The Rule itself does not contain this requirement The court stated that if the plaintiffs sought only injunctive and declaratory relief, this case could readily be certified as a class action under Rule 23(b)(2). (Emphasis added.) However, the court focused on a sentence in the Advisory Committee Notes that class certification under Rule 23(b)(2) does not extend to cases in which the appropriate final relief relates exclusively or predominantly to money damages. The court noted that [w]ere we writing on a clean slate, we might give further consideration to the extent to which monetary relief is available at all in 23(b)(2) class actions. Next, the court turned to the question of whether the district court properly interpreted the requirement of predominance. The court acknowledged that there was no guidance concerning this question in the Advisory Committee Notes and that commentators have taken the position that determining whether one form of relief actually predominates in some quantifiable sense is a wasteful and impossible task that should be avoided. The court s analysis led it to the conclusion that the predomination requirement of Rule 23(b)(2) serves essentially the same functions as the procedural safeguards and efficiency and manageability standards mandated in (b)(3) class actions." 11 The requirement serves first to protect the legitimate interests of potential class members who might wish to pursue their monetary claim individually and serves second to preserve the legal system's interest in judicial economy." 12 In sum, the court ruled that monetary relief predominates in (b)(2) class actions unless it is incidental to requested injunctive or declaratory relief. By incidental, we 11 This is an extraordinary construction: The court read one line in the Advisory Committee Notes for Rule 23 (b)(2) as, in effect, incorporating the specific requirements written in the language of (b)(3). 12 Nowhere in the opinion does the court acknowledge that a principal purpose of Rule 23(b)(2) was to provide a procedural basis for litigating claims of systemic or class-based discrimination. See Advisory Committee Notes. Moreover, the legislative history of the CRA of 1991 expressly endorsed enforcement by class action litigation. 7

8 mean damages that flow directly from liability to the class as a whole on the claims forming the basis of the injunctive or declaratory relief. (Emphasis in original). The court attempted to distinguish Pettway v. American Cast Iron Pipe Co., 494 F.2d 211 (5th Cir. 1974), as well as other Fifth Circuit cases, by stating that back pay is equitable. The court acknowledged that whether a given claim for money damages qualifies as incidental damages will not always be a precise determination. The determination of when, consistent with our cases, non-equitable claims for monetary relief may properly qualify as incidental damages under Rule 23(b)(2) is left for district courts to determine. The district courts, in the exercise of their discretion, are in the best position to assess whether a monetary remedy is sufficiently incidental to a claim for injunctive or declaratory relief to be appropriate in a (b)(2) class action. The court then turned to whether the lower court abused its discretion in applying the predomination standard. We have little trouble affirming the district court s finding that the plaintiffs claims for compensatory and punitive damages are not sufficiently incidental to the injunctive and declaratory relief being sought to permit them in a (b)(2) class action. The court started with the premise that in the Fifth Circuit compensatory damages for emotional distress will not be presumed from mere violation of constitutional or statutory rights. See Patterson v. P.H.P. Healthcare Corp., 90 F.3d 927, (5th Cir. 1996), cert. denied, 117 S. Ct. 767 (1997). "Specific individualized proof is necessary.... Id. The court also determined that punitive damages cannot be assessed merely upon a finding that defendant engaged in a pattern or practice of discrimination, and must be reasonably related to the compensatory damages. Accordingly, like compensatory damages, the punitive damages are not incidental to the equitable relief. 13 The court also addressed the question of whether the lower court erroneously failed to certify a hybrid class action, whereby the plaintiffs claims for compensatory and punitive damages would be certified under Rule 23(b)(3), and the rest of the class claims would be certified under Rule 23(b)(2). The court found that the claims for compensatory and punitive damages would focus almost entirely on facts and issues specific to individuals rather than on facts and issues common to the class as a whole: what kind of discrimination was each plaintiff subjected to; how did it affect each plaintiff emotionally and physically. 14 The predominance of individual-specific issues relating to the plaintiffs claims for compensatory and punitive damages in turn detracts from the superiority of the class action 13 The Allison court s analysis regarding punitive damages has now been called into uncertainty given the Supreme Court s recent (June 24, 1999) granting of the writ of certiorari vacating the Fourth Circuit s opinion in Lowery v. Circuit City Store, Inc., 158 F.3d 742 (4th Cir. 1998), for further consideration in light of Kolstad v. ADA. Lowery had affirmed the decertification of a race discrimination class action and had also imposed the now discredited egregiousness standard on plaintiffs seeking punitive damages. 14 The analysis misses the nature of "pattern or practice" proof and the consequential shifting of the burden of proof. See Teamsters v. United States, 431 U.S. 324 (1977). 8

9 device for these claims. The court stated that the relative substantial value of these claims... and the availability of attorneys fees eliminate financial barriers that might make individual lawsuits unlikely or unfeasible." 15 The court rejected the argument that the common issue is the existence of plant-wide racially discriminatory practices because it fails to appreciate the overwhelming number of individual-specific issues in this case. Finally, the court considered whether the action could have been certified only for claims for equitable relief. The court acknowledged that our cases have held that failure to certify a class action on such claims may amount to an abuse of discretion, but determined that the Seventh Amendment precluded certification of a class for equitable relief only or solely upon a disparate impact theory, because the factual issues upon which this claim is premised would have to be tried to the same jury that would try the claims for compensatory or punitive damages. 16 Judge Dennis dissented. "The majority's decision rests on a conception of Rule 23(b)(2) that is irreconcilable with the basic purposes of Rule 23, the text of Rule 23(b)(2), the Advisory Committee Notes on Rule 23(b)(2), the exercise of informed and sound discretion by the district court in deciding whether to certify, and Rule 23(b)(2)'s proven effectiveness and unique appropriateness in civil rights cases, especially Title VII actions." According to the dissent, courts may manage Title VII class actions that include claims for damages in a manner consistent with the Seventh Amendment. In particular, courts may use the traditional "two-stage" approach to litigating such cases. Since the "bifurcated phases of a Title VII class action contemplate separate and distinct issues," separate juries may be used. IV. MOTION PRACTICE In addition to the critically important class certification motion, counsel litigating a class action may expect to participate in motion practice that may typically include all or some of the following: (1) discovery motions, (2) communications motions, (3) Daubert motions, (4) bifurcation motion, (5) summary judgment motions, (6) in limine motions, and (7) decertification motion. 1. DISCOVERY MOTIONS: Discovery is usually necessary before any ruling on class certification. Hudson v. Delta Air Lines, Inc., 90 F.3d 451, 458 (11th Cir. 1996), cert. denied, 519 U.S (1997). Defendants will often seek to limit discovery to certification issues ( class discovery ) until after discovery. There is no bright line between class and merits discovery. See Manual for Complex Litigation (Third Ed.) ( MCL 3d ) at Plaintiffs will also want to limit often abusive discovery of proposed class representatives. Newberg On Class Actions (3rd Ed.) at 3.33; Eggleston v. Chicago Journeyman Plumbers 15 This is incredible nonsense. It would be extremely difficult for even a small number of the class members to find counsel in Lake Charles, Louisiana, to represent them on their individual claims. [Sorry for the strong editorial comment.] 16 The court expressly did not consider the consequences of plaintiffs dropping their request for compensatory and punitive damages. 9

10 Local Union No. 130, 657 F.2d 890 (7th Cir. 1981). Similarly, plaintiffs will want to limit efforts by defendants to take discovery of absent class members. Any such discovery requires a court order before defendant can proceed. MCL 3d at 33.53; Dellums v. Powell, 566 F.2d 167, 187 (D.C. Cir. 1977). Plaintiffs are entitled to but often have to move to compel production of computerized personnel data. MCL 3d at Plaintiffs are also entitled to discovery of employee personnel files (except for medical information). Orlowski v. Dominick s Finer Foods, Inc., 1998 WL (N.D. Ill. 1998) (relevance to Title VII claims outweighs privacy rights). 2. COMMUNICATIONS MOTIONS: The parties communications with employee class members is often a matter of sharp dispute leading to the filing of cross motions for protective orders. See Babbitt v. Albertson s Inc., 1993 WL (N.D. Cal. 1993)(denying plaintiffs motion for an order banning defendant from communicating with potential class members; however defendant order to instruct agents to refrain from statements that may deter class members from cooperating with class counsel); and Babbitt v. Albertson s Inc., 1993 WL (N.D. Cal. 1993)(denying defense motion for protective order regarding plaintiffs counsel s letter to all potential class members). 17 The court may enter an order restricting communications under Rule 23(d), but only if the order is based on a clear record and specific findings that reflect a weighing of the need for a limit on communications. Gulf Oil v. Bernard, 452 U.S. 89 (1981); Manual for Complex Litigation (3rd Ed.) at Several recent decisions regarding communications should be reviewed by counsel: Jackson v. Motel 6 Multipurpose, Inc., 130 F.3d 999 (11th Cir. 1998)(pre-certification communication order vacated on writ of mandamus as abuse of discretion due to excessive scope and potential harm to defendant); Abdallah v. Coca-Cola Co., 1999 WL (N.D. Ga. 1999)(declining to limit parties communication with media but requiring defendants s to class members to include warning that employer cannot retaliate against employees who choose to participate in litigation); Shores v. Publix Super Markets, Inc., 1996 WL (M.D. Fla. 1996)(requiring corporate employer to include same warning re retaliation); Shores v. Publix Super Markets, Inc., 1997 WL (M.D. Fla. 1997)(additional restrictions imposed on defendant s communications to class). 18 See also, E.E.O.C. v. Mitsubishi Motor Mfg., 102 F.3d 869 (7th Cir. 1996); E.E.O.C. v. Mitsubishi Motor Mfg., 73 FEP Cases (BNA) 762 (C.D. Ill. 1997) (employer limited to discussing case with employees by means of noticed depositions). Note that counsel must factor in the ethical considerations raised by communications in the context of employment class actions. Counsel are prohibited from communicating with any party known to be represented by other counsel. Rule 4.2 of Model Rules of Professional 17 Given the court s authority to issue discretionary notice under Rule 23 (d)(2), a better course of action may be for counsel to attempt to negotiate the text of a proposed court-issued notice and to brief disputed issues to the court for resolution. 18 The first Publix communications order was superceded by the second order, which in turn was vacated by agreement of the parties in the context of the settlement. 10

11 Responsibility and state analogues thereto. This raises difficult issues in the context of employment class actions. While class counsel are generally not recognized as having an attorney-client relationship with putative class members pre-certification, there is an incipient fiduciary relationship at this stage (MCL 3rd 30.24), and potential class counsel may properly solicit additional class representatives and communicate with class members. Newberg on Class Actions, (3d ed. 1992). After class certification, class members are represented by class counsel. MCL 3rd at 30.24; Kleiner v. First National Bank of Atlanta, 751 F.2d 1193, (11th Cir. 1985). At this point, defendants counsel may not communicate with class members, even managers, except under the most limited circumstances. 3. DAUBERT (EXPERT WITNESS) MOTIONS: The parties in employment discrimination class actions typically rely heavily on a battery of expert witnesses which may include statisticians, labor economists, sociologists, industrial psychologists, social psychologists and other human resources professionals. Since the Supreme Court s landmark decision governing the admission of expert testimony in Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S S. Ct (1993)(confirming the court s gatekeeper function to exclude junk science pursuant to FRE 702), it has become commonplace for the defendants to challenge some or all of plaintiffs expert witness with pre-trial Daubert motions. Butler v. Home Depot, 984 F. Supp (N.D. Cal. 1997). See also: Kumho Tire Co. v. Carmichael, 119 S. Ct (1999) (reaffirming Daubert, and applying it to technical and specialized knowledge prongs of FRE 702 in addition to scientific evidence). 4. BIFURCATION MOTIONS: Plaintiffs will continue to want to file a motion to bifurcate trial of liability and damages issues. It may be well to do this in the context of the class certification motion. See Butler v. Home Depot, 70 FEP Cases (BNA) 51, (N.D. Cal. 1996); Morgan v. UPS, 169 F.R.D. 349 (E.D.Mo. 1996); Arnold v. United Artists Theatre Circuit, Inc., 158 F.R.D. 439 (N.D. Cal. 1994); Shores v. Publix Super Markets, 69 EPD 44,477 (M.D. Fla. 1996); Orlowski, 172 F.R.D See also discussion of Allison v. Citgo, in Part III, above. 5. SUMMARY JUDGMENT MOTIONS: Plaintiffs can expect defendants to bring summary judgment motions. These may come at different times and forms. Some defense counsel prefer to seek summary judgment as to individual named plaintiffs prior to class certification. This is rarely an effective method of proceeding since class counsel will usually be given an opportunity to intervene additional representative plaintiffs, thus continuing the litigation. In some cases, defendants may seek summary adjudication as to class liability. While this is a potential home run motion for the defense, the loss of such a motion by the defendant may increase plaintiffs leverage for settlement prior to the class liability trial. Butler v. Home Depot, 1997 WL 605, 754 (N.D. Cal. 1997). See Marcus and Blank, Built From Scratch (Random House 1999) at pp (settlement precipitated by defendant s loss of pretrial motions). 6. IN LIMINE MOTIONS: As in other cases, one can expect a barrage of critical motions in limine just prior to trial. In Butler v. Home Depot, the defendant filed over 60 such motions in the month before the scheduled start of trial, while the plaintiffs filed a substantial number as well. These motions are critical for the nature and scope of the evidence that will be permitted at trial. For example, in Butler v. Home Depot, the court s decision to permit 11

12 evidence of sexual harassment on the issue of the intent to discriminate against women, was critical to the defendant s decision to settle the case. Butler v. Home Depot, 1997 WL (N.D. Cal. 1997); E.E.O.C. v. Farmer Bros. Corp., 31 F.3d 891, 897 (9th Cir. 1994) DECERTIFICATION MOTION: Under FRCP 23, all class certification orders are provisional and are subject to revision by the court at its discretion either upon a motion by the defendant or sua sponte. See General Telephone Company of Southwest v. Falcon, 437 U.S. 147, 160 (1982); Forehand v. Florida State Hospital at Chattahoochee, 89 F.3d 1562 (11 C.R. 1996) (affirming decertification ten years after initial order); Lowery v. Circuit City Stores, Inc., 158 F.3d 742 (4th Cir. 1998), cert. granted and judgment vacated (June 24, 1999). No matter how unlikely, some defendants will continue to seek decertification of the class even on the eve of trial, raising any available new legal developments or simply rehashing its previously rejected complaints about manageability. See Butler v. Home Depot, 1997 WL at *14-17 (N.D. Cal. 1997). Whether this practice will be impacted by the availability of Rule 23(f) appeals remains to be seen. V. INTERLOCUTORY APPEAL UNDER FRCP 23(f) The new Rule 23(f) permitting discretionary interlocutory appeal of class certification rulings has been in effect now since December 1, 1998, with little in terms of judicial guidance to date. 20 It is premature to speculate meaningfully on the impact of Rule 23(f) on employment class action practice, except that it will be a routine factor in litigation from here on out. Rule 23(f) states that: A court of appeals may in its discretion permit an appeal from an order of a district court granting or denying class action certification under this rule if the application is made to it within ten days after entry of the order. 21 An appeal does not stay proceedings in the district court unless the district judge or the court of appeals so orders The other pre-trial issue that apparently moved Home Depot to settle was the trial court s order limiting the duration of trial and allocating each side 80 hours to put on its case. See Built From Scratch, pp See also Watkins v. Scott paper Co., 530 F.2d 1159, 1172 (5th Cir. 1976); MCL 3d , The author is aware that the Eleventh Circuit has granted the defendant s petition for a Rule 23(f) appeal of the class certification in Israel v. Avis Rent-A-Car Systems, Inc., 185 F.R.D. 372 (S.D. Fla. 1999). On June 22, 1999, the Seventh Circuit ruled on the petition in Blair v. Equifax Check Services, Inc., 1999 WL (7th Cir. 1999), discussed herein. 21 In Equifax, the Seventh Circuit found that a motion for reconsideration tolls the time for appeal under this rule. Id. at *5. 22 In Equifax, the Seventh Circuit also determined that such stays would be infrequent due to the high standard for granting a stay (akin to that necessary to obtain a preliminary injunction) 12

13 As to the standard a court should use in deciding to grant such appellate review, the Committee Note accompanying Rule 23(f) remarked that: The court of appeals is given unfettered discretion whether to permit the appeal, akin to the discretion exercised by the Supreme Court in acting on a petition for certiorari. Permission to appeal may be granted or denied on the basis of any consideration that the court of appeals finds persuasive. As quoted in Equifax, 1999 WL at *1. The Seventh Circuit panel in Equifax declined to catalog the factors that might be persuasive or to invent new standards. The panel did, however, refer to what it identified as the three reasons Rule 23(f) was adopted. (1) The death knell case in which denial of class certification is fatal to the ongoing litigation because the individual plaintiff s claim is too small to justify the expense of litigation. (2) The bet the company case in which absent prompt judicial review a questionable class certification puts undue pressure on a corporate defendant to settle due to the enormous stakes involved. The panel cautioned that this scenario should only permit appeal where the class certification ruling below appears to be defective. (3) The development of the law case where fundamental issues about class actions have been poorly developed and interlocutory review is justified by the need for appellate clarification. It would appear that once review is granted, the standard for reversing the district court s certification decision remains the same, i.e., abuse of discretion. 23 VI. CONCLUSION Despite the recent challenges to the use of class actions in discrimination cases, it seems unlikely that plaintiffs will be barred from using class actions to address issues of systemic race and gender discrimination in the workplace. It remains axiomatic that (r)acial discrimination is by definition class discrimination Oatis v. Crown Zellerbach Corp., 398 F.2d 496 (5th Cir. 1968) and that class actions remain the most obvious and effective legal procedure available to address the most obvious evil Congress sought to address with Title VII. International Bhd. of Teamsters v. United States, 431 U.S. 324, 335 n.15 (1977). Courts will retain and make use of their wide discretion in deciding whether to certify a proposed class. Shipes v. Trinity Indus F.2d 31, 316 (5th Cir.), cert. denied, 510 U.S. 991 (1993). Therefore, employment class actions will remain a vital part of the legal landscape in the coming decades. and that Rule 23(f) appeals should not unduly retard the pace of litigation. Id. at *4. 23 Note that in Equifax (not an employment case), the panel was able to determine, without further briefing, that the underlying certification decision was not an abuse of discretion and so went ahead an affirmed the trial court ruling. 13