PERRYMAN v. JOHNSON PRODUCTS CO., INC.

TUTTLE, Senior Circuit Judge:

This appeal challenges the finding of the district court that the defendant, Johnson Products Company, Inc., violated Title VII of the Civil Rights Act of 1964, 42 U.S.C.A. §§ 2000e et seq.1, by discriminating against women in hiring, promotion, and termination practices. The court found that the plaintiffs had proven both individual acts of discrimination and a pattern or practice2 of discrimination affecting the plaintiff class. This appeal also seeks relief from the subsequent order of the district court granting individual and injunctive relief to the plaintiff class. Because of the district court's erroneous legal analysis of the allegations of individual instances of discrimination, we find ourselves unable satisfactorily to review the district court's order; therefore, we vacate and remand for further consideration by the district court.

I. THE FINDING OF CLASSWIDE DISCRIMINATION

A. Introduction

Defendant Johnson Products Company is a cosmetics manufacturer and distributor with its principal offices located in Chicago, Illinois. Its beauty aid products are sold primarily to black consumers, and it does business throughout the United States and in several countries on the African continent.

Plaintiff Patricia Perryman was employed by Johnson Products as a sales representative from July 1971 until her termination in July 1974. Plaintiff Helen Jackson Reddick was employed by Johnson Products as a sales representative from January 1973 until her termination in April 1975. Neither woman was ever promoted above the entry level position of sales representative. Plaintiff Finesse Smith Ward was denied employment with Johnson Products in August 1974.

In the court below, these three named plaintiffs alleged on behalf of themselves and all persons similarly situated3 that Johnson Products had discriminated against women in hiring, firing, and termination decisions in the company's retail and professional sales division. Perryman and Reddick further alleged that their terminations constituted retaliatory discharges for sex discrimination complaints filed with the Equal Employment Opportunity Commission. The plaintiffs presented additional evidence of individual acts of discrimination against class members Claudette Trufant, Ann Smith, Rolena Porter, Diane Bradley, Barbara Isiah, and Isabel Paulding.

B. The District Court Opinion

In its order of December 23, 1981, the district court found that the plaintiffs had successfully proven a pattern or practice of disparate treatment4 on account of sex of the plaintiffs and their class in hiring, promotion, and termination decisions. The court also found that plaintiffs Perryman and Reddick had proven retaliation for the filing of EEOC charges. In conclusion, the district court stated, "[The] defendant has not articulated any legitimate, non-discriminatory reasons for its actions ..." We find this conclusion to be clearly erroneous; this statement by the district court compels us to conclude that the court did not give proper weight to the evidence presented by Johnson Products, and we remand so that we may be certain that the defendant received a full and fair consideration of the merits of its case.5

C. The Applicable Legal Analysis

In an action alleging discriminatory treatment by an employer on the basis of race, color, religion, sex or national origin, an individual plaintiff must prove discriminatory motive. International Brotherhood of Teamsters v. United States, 431 U.S. 324, 335 n. 15, 97 S.Ct. 1843, 1854 n. 15, 52 L.Ed.2d 396 (1977). Since this motive or intent is seldom capable of proof by direct evidence, the Supreme Court has established a legal framework which allows a court to infer discriminatory motive on the basis of circumstantial evidence. McDonnell Douglas Corp. v. Green, 411 U.S. 792, 802-04, 93 S.Ct. 1817, 1824, 36 L.Ed.2d 668 (1973); Texas Department of Community Affairs v. Burdine, 450 U.S. 248, 252-56, 101 S.Ct. 1089, 1093-95, 67 L.Ed.2d 207 (1981).

The three-part test created by the Court requires, first, that the plaintiff establish a prima facie case of illegal discrimination. McDonnell Douglas, 411 U.S. at 802, 93 S.Ct. at 1824. Though the Court in McDonnell Douglas considered an allegation of discrimination in hiring, the elements deemed by the Court necessary to a prima facie showing of hiring discrimination6 have been modified and broadly applied to all types of illegal discrimination in the employment process. For example, this Court has interpreted the Supreme Court's mandate to provide that a prima facie case of discrimination in termination is established where

Lee v. Russell County Board of Education, 684 F.2d 769, 773 (11th Cir.1982). A similar burden has been imposed on plaintiffs seeking to establish a prima facie case of discrimination in promotion7 and retaliatory discharge.8

Once the plaintiff has established a prima facie case of discrimination, the burden shifts to the employer "to articulate some legitimate, non-discriminatory reason" for the alleged discriminatory action. McDonnell Douglas, 411 U.S. at 802, 93 S.Ct. at 1824. If the employer fails to meet this burden, the prima facie case of the plaintiff stands unrebutted, and judgment must be entered for the plaintiff as a matter of law. Burdine, 450 U.S. at 254, 101 S.Ct. at 1094.

It is important to bear in mind, however, that the defendant's burden of rebuttal is exceedingly light; "the defendant need not persuade the court that it was actually motivated by the proffered reasons ... it is sufficient if the defendant's evidence raises a genuine issue of fact as to whether it discriminated against the plaintiff." Id. at 254-55, 101 S.Ct. at 1094. At this stage of the inquiry, the defendant need not persuade the court that its proffered reasons are legitimate; the defendant's burden is "merely one of production, not proof." Lee, 684 F.2d at 773.

Once the defendant has rebutted the plaintiff's prima facie case, the plaintiff must carry his or her ultimate burden of establishing by a preponderance of the evidence that a discriminatory intent motivated the employer's action. McDonnell Douglas, 411 U.S. at 804, 93 S.Ct. at 1825. The plaintiff may accomplish this indirectly by showing that the employer's proffered explanation is pretextual, or directly by showing that a discriminatory reason more likely motivated the employer's action. Burdine, 450 U.S. at 256, 101 S.Ct. at 1095. If the plaintiff succeeds in this showing, a presumption is created that the adverse employment action was the product of discriminatory intent; this presumption may only be rebutted by a showing by the employer that the adverse action would have been taken even in the absence of discriminatory intent. Mt. Healthy City School District Board of Education v. Doyle, 429 U.S. 274, 287, 97 S.Ct. 568, 576, 50 L.Ed.2d 471 (1977).

The Supreme Court has noted that the McDonnell Douglas method of analysis is not necessarily applicable to every allegation of employment discrimination based on circumstantial evidence; the Court has urged trial and appellate courts to maintain a flexible approach in the face of varying factual circumstances. McDonnell Douglas, 411 U.S. at 802 n. 13, 93 S.Ct. at 1824 n. 13; Furnco Construction Corp. v. Waters, 438 U.S. 567, 575-76, 98 S.Ct. 2943, 2948, 57 L.Ed.2d 957 (1978). However, in the absence of any indication by the district court that the posture of the present case merits a departure from the explicit McDonnell Douglas guidelines, we must assume that the district court intended to apply those guidelines in its determination that the named plaintiffs had proven individual cases of disparate treatment.

Of course, some plaintiffs are able to prove the existence of discriminatory intent by direct evidence; in these rare cases, the plaintiff is not required to rely on the inference of discrimination created by the prima facie case of McDonnell Douglas. Ramirez v. Sloss, 615 F.2d 163, 169 (5th Cir.1980). If the factfinder believes the direct evidence presented by the plaintiff, a presumption is created that the adverse employment action taken against the plaintiff was a product of that discriminatory intent. Lee, 684 F.2d at 774. At this point, just as with a successful showing by the plaintiff of discriminatory intent based on circumstantial evidence, the burden shifts to the defendant to prove by a preponderance of the evidence that the adverse action would have been taken even in the absence of a discriminatory motive. Mt. Healthy, 429 U.S. at 287, 97 S.Ct. at 576.

In an action brought by individual plaintiffs alleging discrimination in various facets of the employment process, e.g. hiring, promotion, and termination, each plaintiff bears the burden of proving that each employment decision that adversely affected him or her was the product of a discriminatory motive. This is not to say, of course, that several plaintiffs may not rely on identical evidence to prove this motive or that a single plaintiff may not present similar evidence to prove discrimination in various employment decisions adversely affecting him or her. We mean only to state the obvious fact that each plaintiff bears the burden of proving each of his or her individual causes of action, whether by direct evidence or by circumstantial evidence via the McDonnell Douglas analysis.

However, the neat pattern of shifting inferences provided by McDonnell Douglas is not directly applicable to class actions. Though courts frequently discuss the necessity of a class making out a prima facie case of discrimination, great uncertainty exists as to the precise elements of this prima facie case.9 This confusion is compounded when a class seeks to establish its case with circumstantial evidence.10 Therefore, most courts have, in effect, avoided any type of structural analysis and simply considered the evidence as a whole to determine whether the plaintiff class has established "by a preponderance of the evidence that ... discrimination was the company's standard operating procedure — the regular rather than the unusual practice." Teamsters, 431 U.S. at 336, 97 S.Ct. at 1855.

In most class actions alleging employment discrimination, a vital part of the plaintiffs' case is evidence that individual class members, particularly the named plaintiffs, were illegally discriminated against in various facets of the employment process; likewise, the district court in the present case devoted a large part of its opinion to a discussion of instances of discrimination impacting on one or more of the named plaintiffs. Therefore, in the absence of compelling independent evidence of a pattern or practice of discrimination, this Court must assume that the district court's determination that the named plaintiffs were the victims of individual acts of discrimination provided substantial, and perhaps determinative, support for the lower court's finding of a pattern or practice of discrimination. Where, as here, the findings of individual acts of discrimination were based on an erroneous application of the McDonnell Douglas analysis, the finding of a pattern or practice is undercut; since we are unable to hold that a reasonable factfinder could not find in favor of the defendant, Johnson Products, we are compelled to remand.11

D. The Defendant's Proof at Trial

The district court opinion and the record on appeal present substantial direct and circumstantial evidence of illegal sexual discrimination;12 certainly, if the plaintiffs' evidence stood unchallenged, the district court might well have found that a prima facie case had been established as to the named plaintiffs and the class, and judgment could properly have been entered in their favor.

However, as the evidence cited below indicates, Johnson Products presented a vigorous defense which created an issue of fact as to most, if not all, of the allegations of discrimination presented by the plaintiffs. There can be no question but that the defendant met its minimal burden of articulating non-discriminatory reasons for its actions.

Although the defendant conceded that the final decisions on hiring, promotion, and termination in the sales division were made solely by John Johnson, the Vice President of Sales, until his death in 1975, it urged that his decisions were based on objective factors such as prior experience, education, and job performance. The defendant asserted that the plaintiffs' statistical evidence, presented by a Dr. John Fluker, was particularly useless for its failure to consider these factors as they related to individual members of the pool for hiring and promotion.

The defendant also cited historical factors as justification for the notable absence of women in supervisory positions in its sales division until after the filing of this action. The defendant noted that since very few women worked as salespersons until the 1960's, it was natural for men to have an edge in experience and an advantage in promotions. The company argued that very few women applied for sales jobs up to the 1960's given the long periods away from home and the obvious difficulties facing a black person traveling in the South (the region focused on by the plaintiff class) during the company's earlier years.

Additional evidence presented by the defendant sought to refute the individual allegations of the named plaintiffs. Johnson Products urged that Smith was not hired due to her lack of experience (an affidavit of John Johnson was introduced to that effect) and noted that the position applied for by Smith was filled by a transfer from Baltimore. The defendant urged that promotion decisions adversely affecting plaintiffs Perryman and Jackson were reached only after a careful comparison of the experience and performance of prospective managers; the defendant cited individual examples where promoted males had more work experience than Jackson and Perryman.

The defendant introduced psychological studies conducted of Jackson and Perryman shortly after the commencement of their employment with the company. The studies were conducted by Dr. John Mendheim, a licensed psychologist. Johnson Products urged that the results of these studies fully justified its decisions not to promote Perryman and Jackson. The defendant also suggested that the problems identified by these studies were evident in these plaintiffs' work performance and were a contributing cause to their terminations.13

The defendant also presented evidence challenging the alleged retaliatory motive behind the terminations of Perryman and another female sales representative, Rolena Porter. The termination letter to Perryman, dated July 1, 1974, noted that her discharge was based on her expressed desire to terminate her sales career and move into a position as a beauty critic; the termination letter expressed the company's belief that this lack of enthusiasm for her work was hampering her effectiveness.

Rolena Porter's termination letter of June 5, 1975, specified a number of reasons for her termination including excessive absenteeism and failure to cover her assigned territory. Samuel Haynes, a former district manager of Johnson Products who testified for the plaintiffs, refused to state on cross-examination that any of the reasons given were untrue; he did label some of the stated reasons "technicalities."

E. Conclusion

In light of this evidence presented by the defendant, the district court's conclusion that "the defendant has not articulated any legitimate, non-discriminatory reason for his actions" is clearly erroneous. The defendant has certainly met the minimal burden of articulation set forth by the Supreme Court in Burdine. In these circumstances, the burden should be placed on the plaintiffs either to prove that these articulated reasons were a mere pretext or to show by direct evidence that the employer was motivated by discriminatory intent. There is no showing that the plaintiffs were required to carry this burden in the present case.14

This Court's opinion should not be construed as foreclosing a finding by the district court that sufficient direct evidence exists to support the individual and class allegations. However, if the court below reaches this conclusion, it must specify the evidence relied on for its finding as to each named plaintiff and the class as a whole or particular subclasses. If the court finds that individual allegations of discrimination are incapable of proof by direct evidence, then, in order to find that specific individuals were discriminated against, it must rely on the three-step test of McDonnell Douglas absent some justification for a departure from that analysis. If the named plaintiffs are able to prove by either direct or circumstantial evidence that any of the various adverse actions taken against them were the product of discriminatory intent, then the district court may properly rely on those showings as evidence of a pattern or practice of discrimination. In any case, if the court wishes to grant individual relief to the named plaintiffs, it must make the additional finding that the defendant failed to show by a preponderance of the evidence that the adverse employment actions would have been taken even in the absence of a discriminatory motive.

Finally, the district court should bear in mind that the failure of the named plaintiffs to prove that they were victims of individual instances of discrimination does not necessarily prevent the court from finding the existence of a pattern or practice of discrimination as to the class. Thurston v. Dekle, 531 F.2d 1264, 1271 (5th Cir.1976), vacated on other grounds, 438 U.S. 901, 98 S.Ct. 3118, 57 L.Ed.2d 1144 (1977); Bowe v. Colgate-Palmolive Co., 416 F.2d 711, 719 (5th Cir.1969); Jenkins v. United Gas Corp., 400 F.2d 28, 31-32 (5th Cir.1968). The drafters of Title VII envisioned that statute as a protective measure for certain minority classes; once a class representative has satisfied the threshold representation requirements of Rule 23 of the Federal Rules of Civil Procedure,15

Hutchings v. United States Industries, Inc., 428 F.2d 303, 311 (5th Cir.1970).

II. THE MOORE LETTER

At trial, the defendant attempted to introduce into evidence a March 8, 1975, letter from Ed Moore, defendant's district sales manager, to one of the defendant's attorneys; in that letter, Moore denied ever having told plaintiff Smith that past female sales representatives were "rotten eggs" and stated that Smith had not been hired because of her lack of qualifications. The court refused to admit the letter since the defendant had not laid a proper foundation. There was some dispute at trial as to whether Moore was alive,16 but his physical status is not relevant to our disposition of this issue.

The defendant argues that this letter should have been admitted pursuant to Fed. R.Evid. 804(b)(5), 28 U.S.C.A.,17 a catchall exception to the hearsay rule which allows the introduction of out-of-court statements by an unavailable person when those statements possess certain qualities (such as trustworthiness and materiality) generally required of admissible hearsay evidence. The defendant directs this Court's attention to Copperweld Steel Co. v. Demag-Mannesman-Bohler, 578 F.2d 953, 963-64 (3rd Cir. 1978), where the court upheld the admission under Rule 804(b)(5) of a memorandum prepared by an attorney summarizing his conversation with a key witness who died prior to trial. In that case, however, the parties agreed that the deceased witness had edited the memorandum and that handwritten notes on the memorandum had been inscribed by the witness. In these circumstances, the court ruled that the document had "equivalent circumstantial guarantees of trustworthiness" as other items admissible under hearsay exceptions.

In the present case, however, there are no assurances that Moore in fact wrote or authorized the disputed letter. The defendant did not even attempt to establish the letter's authenticity by, for example, introducing a handwriting expert to verify Moore's signature or a secretary to testify as to the production of the letter. Without these guarantees of trustworthiness, we must uphold the district court's action, especially in light of the broad discretion granted the trial court under Rule 804(b)(5) and its sister provision, Fed.R.Evid. 803(24), 28 U.S.C.A. Robinson v. Shapiro, 646 F.2d 734, 743 (2d Cir.1981); Huff v. White Motor Corp., 609 F.2d 286, 291 (7th Cir.1979); Weinstein's Evidence, ¶ 803(24)[01] at 803-290.

III. RECERTIFICATION OF THE CLASS

On June 6, 1980, almost one year prior to the commencement of the trial in this case, the district court certified a class of:

On December 23, 1981, following a post-trial briefing, the court, over the defendant's objection, recertified the class to include only a portion of the original class:

Johnson Products alleges that the presentation of its defense was severely prejudiced by the class recertification. The defendant urges that its proof focused on its entire non-production workforce, i.e., all employees not engaged in the production of the defendant's products, and that it was never given an adequate opportunity to prepare and defend against the recertified class.

Fed.R.Civ.P. 23(c)(1), 28 U.S. C.A.,18 grants the trial court great discretion in the initial certification and subsequent amendment of a class. Johnson v. Georgia Highway Express, Inc., 417 F.2d 1122, 1123 (5th Cir.1969); Shumate & Co., Inc. v. National Association of Securities Dealers, 509 F.2d 147, 155 (5th Cir.1975). The trial court has an ongoing responsibility to assess the adequacy of class representation. Payne v. Travenol Laboratories, Inc., 673 F.2d 798, 811 (5th Cir.1982). The defendant has failed to cite any case in which a trial court was held to have abused its discretion by reducing the size of a class prior to a decision on the merits where all members of the recertified class were also members of the original class. The prejudice, if any, suffered by Johnson Products as a result of the recertification of the plaintiff class was not severe enough to compel our interference with the trial court's duty to facilitate the fair and expeditious utilization of the class action mechanism.

IV. OTHER ISSUES

The defendant raises several additional issues on this appeal. However, since the trial court may in its discretion elect to hear additional evidence on remand, it would be premature for us to comment on these issues at this time.

VACATED and REMANDED.