This interlocutory appeal presents the question whether the district court properly refused to certify a class action challenging employment practices by the Citgo Petroleum Corporation ("Citgo") under Title VII (as amended in 1991) and the Civil Rights Act of 1866, 42 U.S.C. § 1981. The plaintiffs, Allison and over 130 other named plaintiffs and intervenors, filed suit on behalf of black employees and applicants for employment alleging that Citgo engaged in class-wide racial discrimination with respect to general hiring, promotion, compensation, and training policies at its manufacturing facilities in Lake Charles, Louisiana. The plaintiffs challenged these policies under disparate impact and systemic disparate treatment theories of discrimination. Seeking injunctive, declaratory, and monetary relief, the plaintiffs moved for class certification under Rule 23 of the Federal Rules of Civil Procedure, which Citgo opposed. The district court denied the motion. On appeal, the plaintiffs contend that the district court's denial of class certification was an abuse of discretion. 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. As we shall explain, however, the plaintiffs' claims for money damages and the constitutional right of both parties to a jury trial, with all its substantive rights and procedural complications, ultimately render this case unsuitable for class certification under Rule 23. We therefore affirm and hold that the district court did not abuse its discretion in denying class certification.
I
This race discrimination case involves a potentially huge and wide-ranging class action lawsuit concerning employment practices at Citgo's Lake Charles manufacturing complex. Specifically, the plaintiffs identified the following employment practices as resulting in unlawful race discrimination: (1) failure to post or announce job vacancies; (2) use of an informal word-of-mouth announcement process for filling job vacancies; (3) use of racially biased tests to evaluate candidates for hire or promotion; and (4) use of a subjective decision-making process by a predominantly white supervisory staff in reviewing applicants for hire and employees for promotion. The plaintiffs challenged each of these policies under both the disparate impact and systemic disparate treatment theories of Title VII.
In September 1993, the plaintiffs filed a motion for the certification of a class estimated to contain more than 1000 potential members. The class was identified as "[a]ll African-American employees and applicants of Citgo Petroleum Corporation (Citgo) from April 11, 1979 until the present." Its members are current and former employees and unsuccessful applicants for employment in "hourly" positions at Citgo's Lake Charles complex. They are spread across two separate facilities. They are represented by six different unions, come from five different skill groups, and work in seven different functional areas at the complex. Nevertheless, the plaintiffs maintain that a class action is appropriate because they are challenging general hiring, training, and promotional policies applied uniformly throughout the complex.
To remedy the alleged discrimination, the plaintiffs seek every available form of injunctive, declaratory, and monetary relief. In terms of affirmative injunctive relief, the plaintiffs seek restructuring of offending policies, instatement into existing jobs, and retroactive seniority and benefits. As for monetary relief traditionally available under Title VII, the plaintiffs request back pay, front pay, pre-judgment interest, and attorneys' fees. Furthermore, invoking the provisions added to Title VII by the Civil Rights Act of 1991, the plaintiffs seek compensatory and punitive damages to the maximum amount permissible under the law. Finally, the plaintiffs demand a jury trial on their claims
The district court referred the plaintiffs' motion for class certification to a magistrate judge, who conducted an evidentiary hearing and subsequently entered a report and recommendation denying class certification. The magistrate judge determined that, although the proposed class met the requirements of Rule 23(a) of the Federal Rules of Civil Procedure, it could not be certified under any of the alternatives provided in 23(b). The plaintiffs sought certification primarily under subsection (b)(2), but the magistrate judge found certification under (b)(2) inappropriate because money damages were the "predominant" form of relief sought. Focusing on the individualized nature of the damages claims and the consequent need for significant individualized proof, he reasoned that they were not sufficiently incidental to the injunctive relief to warrant class certification under 23(b)(2). The magistrate judge also considered class certification under Rule 23(b)(3), but found that the need for individualized damages determinations caused individual issues to predominate over common ones and that a class action would not be a superior method for fair and efficient adjudication of the controversy.
Finally, the magistrate judge contemplated bifurcating the trial into liability and damages stages and certifying a class on only the claims for injunctive relief. He expressed concern, however, over Seventh Amendment complications arising out of bifurcated proceedings with multiple juries and the difficulty in separating liability and damages issues in discrimination cases. The magistrate judge suggested that the proper use of consolidation under Rule 42 of the Federal Rules of Civil Procedure would permit the court to avoid the problems presented by a class action in this case while still achieving some degree of efficiency.
The district court adopted the report and recommendation in its entirety and denied class certification. On petition by the plaintiffs, the court certified the question for interlocutory appeal under 28 U.S.C. § 1292(b), which we granted in May 1996. This appeal followed.
II
We note at the outset that the district court maintains substantial discretion in determining whether to certify a class action, a decision we review only for abuse. See Jenkins v. Raymark Indus., 782 F.2d 468, 471-72 (5th Cir.1986). Implicit in this deferential standard is a recognition of the essentially factual basis of the certification inquiry and of the district court's inherent power to manage and control pending litigation. See Pegues v. Mississippi State Employment Serv., 699 F.2d 760, 763 (5th Cir.), cert. denied, 464 U.S. 991, 104 S.Ct. 482, 78 L.Ed.2d 679 (1983). Whether the district court applied the correct legal standard in reaching its decision on class certification, however, is a legal question that we review de novo. See Forbush v. J.C. Penney Co., 994 F.2d 1101, 1104 (5th Cir.1993).
III
Perhaps it is best at the beginning of this rather extended opinion to say a preliminary word about the task before us. The breadth and complexity of the issues relating to the plaintiffs' broad claims for monetary relief and demand for a jury trial, raised in the context of multiple alternative arguments, make it necessary for us to examine the nature of class actions under Rule 23 and its subparts, as they relate specifically to this case. The plaintiffs urge primarily that the entire case is certifiable as a class action under Rule 23(b)(2). Because they argue that the wide array of monetary remedies they seek does not predominate over requested injunctive or declaratory relief, we must dwell at some length on what "predomination" means for the purposes of Rule 23(b)(2) and how it applies here.
Next, we consider the plaintiffs' argument that, if this case cannot be certified in a (b)(2) class action, it may nevertheless be certified under Rule 23(b)(3). In addressing this argument, we consider whether issues common to the class predominate over issues relating solely to individuals, and whether a (b)(3) class action would be an efficient and manageable
Finally, given that the plaintiffs ultimately resort to a request for a class action on any available basis (but without foregoing any of their class claims for monetary relief), we consider whether this case can be severed in such a way as to make class certification appropriate for any of the plaintiffs' claims, while reserving the question whether to certify the remaining claims for subsequent proceedings. Because of the plaintiffs' demand for a jury trial, resolving this issue requires us to consider the Seventh Amendment implications of severing claims that share common factual issues with the remainder of the case.
IV
Class actions brought under Title VII typically proceed under two theories, disparate impact and systemic disparate treatment, both of which are advanced in this case. The disparate impact theory is used to challenge a facially neutral employment policy that falls more harshly on a protected class of employees. Pouncy v. Prudential Ins. Co. of Am., 668 F.2d 795, 799 (5th Cir. 1982). The systemic disparate treatment theory focuses on whether the employer engaged in a "pattern or practice" of intentional discrimination, that is, whether discrimination was the employer's standard operating procedure rather than a sporadic occurrence. See International Bhd. of Teamsters v. United States, 431 U.S. 324, 336, 97 S.Ct. 1843, 52 L.Ed.2d 396 (1977). In years past, we have routinely upheld certification of class actions to resolve Title VII cases involving disparate impact and pattern or practice claims of discrimination. See, e.g., Richardson v. Byrd, 709 F.2d 1016 (5th Cir.), cert. denied, 464 U.S. 1009, 104 S.Ct. 527, 78 L.Ed.2d 710 (1983); Robinson v. Union Carbide Corp., 538 F.2d 652 (5th Cir.1976), cert. denied, 434 U.S. 822, 98 S.Ct. 65, 54 L.Ed.2d 78 (1977); Pettway v. American Cast Iron Pipe Co., 494 F.2d 211 (5th Cir.1974).
In doing so, we have recognized that the class action device could be implemented effectively to eradicate widespread or institutional-scale discrimination. See Jenkins v. United Gas Corp., 400 F.2d 28, 34 & n. 14 (5th Cir.1968); see also Charles Alan Wright, Arthur R. Miller & Mary Kay Kane, 7A Federal Practice and Procedure § 1776, at 495-96 (2d ed.1986) (civil rights cases frequently involve group discrimination). Disparate impact cases in particular, which challenge specific, facially-neutral policies with proof of statistical disparities resulting from their uniform application to an employer's workforce, by their very nature implicate class-based claims. We also have molded class actions to accommodate claims that an employer engaged in a pattern or practice of intentional discrimination. Ordinarily, such cases are handled in bifurcated proceedings imposing on the plaintiffs different burdens of proof. See Shipes v. Trinity Indus., 987 F.2d 311, 318 (5th Cir.), cert. denied, 510 U.S. 991, 114 S.Ct. 548, 126 L.Ed.2d 450 (1993). During the first or "liability" stage, the plaintiffs seek to prove a pattern or practice of invidious class-based discrimination. See id. If successful, individual class members benefit from a presumption of back pay, their entitlement to which is determined at the second or "remedial" stage. To obtain back pay, class members need only prove that they were denied employment opportunities and the extent of their loss, while the burden then shifts to the employer to demonstrate that those class members were denied employment opportunities for legitimate reasons. See Richardson, 709 F.2d at 1021; see also Teamsters, 431 U.S. at 362, 97 S.Ct. 1843. Although this final determination typically involves separate hearings for each individual, see Johnson v. Goodyear Tire & Rubber Co., 491 F.2d 1364, 1375 (5th Cir.1974), courts, without the need to consider the implications of a jury trial, developed techniques such as the use of special masters to streamline the process, see Newberg & Conte, Newberg on Class Actions §§ 24.119-24.121 (3d ed.1992).
The Civil Rights Act of 1991, however, made fundamental changes in both the procedures and remedies available to Title VII litigants. Among other things, the Act now permits plaintiffs to recover compensatory
In the class action context, the changes to Title VII are not inconsequential.
V
The plaintiffs' principal argument is that the district court erred in refusing to certify the entire case as a class action under Rule 23(b)(2). The district court determined that a primary limitation on the (b)(2) class action is the requirement that injunctive or declaratory relief be the predominant relief sought for the class. Provided this requirement were met, claims for related monetary relief could be entertained in the class action. To ascertain the predominant form of relief sought, the district court considered whether: (1) the request for money damages was integral to and flowed directly from the injunctive or declaratory relief; (2) the request for money damages affected the cohesiveness of the class and the homogeneity of interests; (3) issues common to the claims for injunctive or declaratory relief predominated; and (4) the money damages arose out of conduct based on policies generally applicable to all plaintiffs. Applying these factors, the court concluded that the plaintiffs' claims for money damages predominated over their claims for nonmonetary relief, making certification of the class inappropriate under (b)(2).
The plaintiffs argue that the district court committed legal error in this respect. They first contend that Rule 23(b)(2) contains no predomination requirement. Next, assuming that it does, the plaintiffs argue that the district court erred in its formulation of the (b)(2) predomination requirement as well as in its application of that requirement to deny class certification.
We consider first 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. Naturally, we begin by looking at the plain language of the rule. Rule 23(b)(2) permits cases meeting the requirements of Rule 23(a)
The rule is clear that claims seeking injunctive or declaratory relief are appropriate for (b)(2) class certification. Thus, if the plaintiffs sought only injunctive and declaratory relief, this case could readily be certified as a class action under Rule 23(b)(2).
The plaintiffs, however, also seek monetary relief. Rule 23(b)(2) is silent as to whether monetary remedies may be sought in conjunction with injunctive or declaratory relief. The Advisory Committee Notes on Rule 23 state that class certification under (b)(2) "does not extend to cases in which the appropriate final relief relates exclusively or predominantly to money damages." Fed. R.Civ.P. 23 (advisory committee notes) (emphasis added). This commentary implies that the drafters of Rule 23 believed that at least some form or amount of monetary relief would be permissible in a (b)(2) class action. See Pettway v. American Cast Iron Pipe Co., 494 F.2d 211, 257 (5th Cir.1974).
In addressing what monetary relief is permissible in a (b)(2) class action, this circuit has chosen an intermediate approach, neither allowing certification without regard to the monetary remedies being sought, nor restricting certification to classes seeking exclusively injunctive or declaratory relief. See Johnson v. General Motors Corp., 598 F.2d 432, 437 (5th Cir.1979). We, like nearly every other circuit, have adopted the position taken by the advisory committee that monetary relief may be obtained in a (b)(2) class action so long as the predominant relief sought is injunctive or declaratory.
B
We consider next the substantially more difficult question whether the district court's formulation of (b)(2)'s predomination requirement was correct. As the district court noted, there is little discussion by appellate courts as to what it means for a particular form of relief to be "predominant." The Advisory Committee Notes make no effort to define or explain the concept. Interpreting the term literally, predominant means "controlling, dominating, [or] prevailing." Webster's
(1)
In the absence of clear guidance from the Rule or our cases, we turn to the principles and assumptions underlying the (b)(2) class and class actions in general to ascertain whether they add substance to the concept of predomination under Rule 23(b)(2). Cf. United Savings Ass'n v. Timbers of Inwood Forest Assoc., Ltd., 484 U.S. 365, 371, 108 S.Ct. 626, 98 L.Ed.2d 740 (1988) (Scalia, J.) (explaining that statutory construction is a "holistic endeavor" because provisions that seem ambiguous in isolation are often clarified by the remainder of the statutory scheme).
(a)
Under Rule 23, the different categories of class actions, with their different requirements, represent a balance struck in each case between the need and efficiency of a class action and the interests of class members to pursue their claims separately or not at all. See Amchem Prod., Inc. v. Windsor, ___ U.S. ___, ___, 117 S.Ct. 2231, 2246, 138 L.Ed.2d 689 (1997); United States Parole Comm'n v. Geraghty, 445 U.S. 388, 402-03, 100 S.Ct. 1202, 63 L.Ed.2d 479 (1980); Rutherglen, Title VII Class Actions, 47 U. Chi. L.Rev. 688, 697-98 (1980) (citing Kaplan, Continuing Work of the Civil Committee: 1966 Amendments of the Federal Rules of Civil Procedure, 81 Harv. L.Rev. 356, 387-92 (1967)). The different types of class actions are categorized according to the nature or effect of the relief being sought. The (b)(1) class action encompasses cases in which the defendant is obliged to treat class members alike or where class members are making claims against a fund insufficient to satisfy all of the claims. See Amchem, ___ U.S. at ___, 117 S.Ct. at 2245. The (b)(2) class action, on the other hand, was intended to focus on cases where broad, class-wide injunctive or declaratory relief is necessary. See Holmes v. Continental Can Co., 706 F.2d 1144, 1155 n. 8 (11th Cir.1983). Finally, the (b)(3) class action was intended to dispose of all other cases in which a class action would be "convenient and desirable," including those involving large-scale, complex litigation for money damages. See Amchem, ___ U.S. at ___, 117 S.Ct. at 2245; see also Penson v. Terminal Transp. Co., 634 F.2d 989, 993 (5th Cir. Unit B Jan.1981) (citing Fed.R.Civ.P. 23 (advisory committee notes)). Limiting the different categories of class actions to specific kinds of relief clearly reflects a concern for how the interests of class members will vary, depending upon the nature of the class injury alleged and the nature of the relief sought.
First, different presumptions with respect to the cohesiveness and homogeneity of interests among members of (b)(1), (b)(2), and (b)(3) classes are reflected in the different procedural safeguards provided for each potential class. See Holmes, 706 F.2d at 1155-56. For example, the drafters of Rule 23 found it unnecessary to provide (b)(1) and (b)(2) class members with the absolute right to notice or to opt-out of the class — procedural safeguards made mandatory under (b)(3) for class members who might wish to pursue their claims for money damages in individual lawsuits and to not be bound by membership in a class action. See Fed.R.Civ.P. 23(c)(2).
In contrast, because of the group nature of the harm alleged and the broad character of the relief sought, the (b)(2) class is, by its very nature, assumed to be a homogenous and cohesive group with few conflicting interests among its members.
We know, then, that monetary relief "predominates" under Rule 23(b)(2) when its presence in the litigation suggests that the procedural safeguards of notice and opt-out are necessary, that is, when the monetary relief being sought is less of a group remedy and instead depends more on the varying circumstances and merits of each potential class member's case. Cf. Sosna v. Iowa, 419 U.S. 393, 398 n. 4, 95 S.Ct. 553, 42 L.Ed.2d 532 (1975) ("[T]he absence of a claim for monetary relief and the nature of the claim asserted disclose that a Rule 23(b)(2) class action was contemplated. Therefore, the problems [of notice and opt-out] associated with a Rule 23(b)(3) class action ... are not present in this case."). Because it automatically provides the right of notice and opt-out to individuals who do not want their monetary claims decided in a class action, Rule 23(b)(3) is the appropriate means of class certification when monetary relief is the predominant form of relief sought and the monetary interests of class members require enhanced procedural safeguards.
The fact that the predomination requirement serves to protect the rights of class members regarding their monetary interests does not imply, however, that the availability of monetary relief in a (b)(2) class action depends solely or directly on whether class members are entitled to notice or opt-out rights. Such a narrow focus would ignore the other half of the balance struck by the different categories of Rule 23(b) — the need and efficiency of a class action. As we have earlier observed, the chief purpose behind the class action device is to achieve a significant measure of judicial economy, see Jenkins, 782 F.2d at 471, an interest for which (b)(2)'s predomination requirement must also account. By requiring the predomination of injunctive or declaratory remedies, (b)(2) was intended to serve this purpose by inherently concentrating the litigation on common questions of law and fact. See Holmes, 706 F.2d at 1156; Antidiscrimination Class Actions, supra, at 875-76.
Actions for class-wide injunctive or declaratory relief are intended for (b)(2) certification precisely because they involve uniform group remedies. Such relief may often be awarded without requiring a specific or time-consuming inquiry into the varying circumstances and merits of each class member's individual case. When it does, the relatively complex calculations typically required in class actions for money damages are unnecessary. For these reasons, proposed (b)(2) classes need not withstand a court's independent probe into the superiority of the class action over other available methods of adjudication or the degree to which common issues predominate over those affecting only individual class members, as (b)(3) classes must. See Amchem, ___ U.S. at ___ _ ___, 117 S.Ct. at 2245-46; Forbush v. J.C. Penney Co., 994 F.2d 1101, 1105 (5th Cir.1993); Johnson v. American Credit Co. of Ga., 581 F.2d 526, 531 n. 9 (5th Cir.1978); Manual for Complex Litigation § 33.52, at 348-49 (3d ed.1995).
(c)
In sum, the predomination requirement of Rule 23(b)(2) serves essentially the same
(2)
Consistent with this analysis, we reach the following holding: monetary relief predominates in (b)(2) class actions unless it is incidental to requested injunctive or declaratory relief. Accord Williams v. Owens-Illinois, Inc., 665 F.2d 918, 928-29 (9th Cir.), cert. denied, 459 U.S. 971, 103 S.Ct. 302, 74 L.Ed.2d 283 (1982). By incidental, we 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. See Fed.R.Civ.P. 23(b)(2) (referring only to relief appropriate "with respect to the class as a whole"). Ideally, incidental damages should be only those to which class members automatically would be entitled once liability to the class (or subclass) as a whole is established. See Manual for Complex Litigation, supra, at 348 (citing Simer v. Rios, 661 F.2d 655 (7th Cir.1981)); see also, e.g., Arnold v. United Artists Theatre Circuit, Inc., 158 F.R.D. 439 (N.D.Cal.1994) (defendant's liability entitled class to a statutorily mandated damage award). That is, the recovery of incidental damages should typically be concomitant with, not merely consequential to, class-wide injunctive or declaratory relief. Moreover, such damages should at least be capable of computation by means of objective standards and not dependent in any significant way on the intangible, subjective differences of each class member's circumstances. Liability for incidental damages should not require additional hearings to resolve the disparate merits of each individual's case; it should neither introduce new and substantial legal or factual issues, nor entail complex individualized determinations. Thus, incidental damages will, by definition, be more in the nature of a group remedy, consistent with the forms of relief intended for (b)(2) class actions.
Our holding in this respect is not inconsistent with our cases permitting back pay under Title VII in (b)(2) class actions. In Pettway, for example, we noted that Rule 23(b)(2), by its own terms, does not preclude all claims for monetary relief. See 494 F.2d at 257. We construed (b)(2) to permit monetary relief when it was an equitable remedy, and the defendant's conduct made equitable remedies appropriate. See id. Back pay, of course, had long been recognized as an equitable remedy under Title VII. See Johnson v. Georgia Highway Express, Inc., 417 F.2d 1122, 1125 (5th Cir.1969) ("[a] demand for back pay is not in the nature of damages, but rather is an integral part of the statutory equitable remedy"). Thus, the Pettway court reasoned:
494 F.2d at 257 (emphasis added). In short, Pettway held that back pay could be sought in a (b)(2) class action because, as an equitable remedy similar to other forms of affirmative injunctive relief permitted in (b)(2) class actions, it was an integral component of Title VII's "make whole" remedial scheme. See id. at 252, 257.
As the plaintiffs correctly point out, Pettway stated that the (b)(2) inquiry into whether one form of relief predominates over another involves consideration of the "pragmatic ramifications of adjudication" and the effect of the relief sought, rather than any special attributes of the class involved. See id. at 256 (citing 3B Moore's Federal Practice § 23.45[1] at 703 (2d ed.1969)). The incidental damages standard actually takes these considerations into account. We recognize that, as a matter of degree, whether a given monetary remedy qualifies as incidental damages will not always be a precise determination. Nor is it intended to be. "[C]omplex cases cannot be run from the tower of the appellate court given its distinct institutional role and that it has before it printed words rather than people." Richardson v. Byrd, 709 F.2d 1016, 1019 (5th Cir.), cert. denied, 464 U.S. 1009, 104 S.Ct. 527, 78 L.Ed.2d 710 (1983). 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.
(3)
Returning to the district court's decision in the instant case, we conclude that it applied the correct legal standard in determining whether to certify a class under Rule 23(b)(2). Although it was inappropriate for (b)(2) certification to consider whether issues common to the class predominated over other issues, see Forbush, 994 F.2d at 1105, the district court's analysis in this respect was separate from and in addition to its application of the proper predomination inquiry. It is clear that the district court concentrated its analysis on the extent to which the various forms of requested monetary relief would flow directly from a finding of liability on the plaintiffs' claims for class-wide injunctive and declaratory relief. With respect to applying the correct legal standard for predomination under Rule 23(b)(2), therefore, we cannot say that the district court erred in any way requiring reversal.
C
Having determined that the district court adopted the correct legal standard in assessing the plaintiffs' monetary claims, we must now resolve whether it abused its discretion in applying that standard to deny certification of a class action under Rule 23(b)(2). The plaintiffs' claims for monetary relief include back pay, front pay, compensatory damages, punitive damages, prejudgment interest, attorneys' fees, and retroactive benefits. Examining the different forms of monetary relief, the district court concluded that they did not flow directly from proof of liability on the aspects of the plaintiffs' disparate impact or pattern or practice claims that entitled them to injunctive or declaratory relief. Entitlement to back pay and other equitable monetary remedies, it explained, still required separate hearings in which each class member would have to show that the discrimination caused a loss. Similarly, recovery of compensatory and punitive damages required particularly individualized proof of injury, including how each class member was personally affected by the discriminatory conduct. Thus, the district court held that the claims for money damages were not sufficiently incidental to the injunctive and declaratory relief being sought to permit certification under (b)(2).
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. We start with the premise that, in this circuit, compensatory damages for emotional distress
The plaintiffs' claims for punitive damages are similarly non-incidental. Although the plain language of the Civil Rights Act of 1991 could be interpreted to preclude class-wide punitive damages awards in any case without individualized proof of injury, see 42 U.S.C. § 1981a(b)(1) (punitive damages available if employer acted with malice or reckless indifference to rights of "aggrieved individual"), we need not determine today whether it is so limiting. Assuming punitive damages may be awarded on a class-wide basis, without individualized proof of injury, where the entire class or subclass is subjected to the same discriminatory act or series of acts, no such discrimination is alleged in this case. The plaintiffs challenge broad policies and practices, but they do not contend that each plaintiff was affected by these policies and practices in the same way. Indeed, the plaintiffs seek to certify a class of a thousand potential plaintiffs spread across two separate facilities, represented by six different unions, working in seven different departments, challenging various policies and practices over a period of nearly twenty years. Some plaintiffs may have been subjected to more virile discrimination than others: with greater public humiliation, for longer periods of time, or based on more unjustifiable practices, for example. Particular discriminatory practices may have been gradually ameliorated year by year over the twenty-year period. Some discriminatory policies may have been implemented more — or less — harshly depending on the department or facility involved.
Punitive damages cannot be assessed merely upon a finding that the defendant engaged in a pattern or practice of discrimination. Such a finding establishes only that there has been general harm to the group and that injunctive relief is appropriate. See Price Waterhouse v. Hopkins, 490 U.S. 228, 266, 109 S.Ct. 1775, 104 L.Ed.2d 268 (1989) (O'Connor, J., concurring in the judgment). Actual liability to individual class members, and their entitlement to monetary relief, are not determined until the second stage of the trial. See id.; Dillon v. Coles, 746 F.2d 998, 1004 (3d Cir.1984). And because punitive damages must be reasonably related to the reprehensibility of the defendant's conduct and to the compensatory damages awarded to the plaintiffs, see Patterson,
Given the degree to which recovery of compensatory and punitive damages requires individualized proof and determinations, they clearly do not qualify as incidental damages in this case.
VI
A
Given that the district court acted within its discretion in denying class certification of the entire action under Rule 23(b)(2) because of the predomination of money damages in this case, we next consider the plaintiffs' argument that the district court erred in refusing 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 action certified under Rule 23(b)(2). Rule 23(b)(3) permits certification of a class action
The plaintiffs argue that these requirements are clearly satisfied in this case. They contend that the (b)(3) predominance standard focuses on the issue of liability, and if the liability issues are common to the class, common questions predominate over individual ones, citing In re Kirschner Med. Corp. Sec. Litig., 139 F.R.D. 74 (D.Md.1991). The plaintiffs insist further that, here, a class action is plainly superior to hundreds of individual lawsuits.
The district court disagreed. It concluded that, class action or not, Citgo's liability for compensatory and punitive damages could be established only through examination of each plaintiff's individual circumstances. Individual issues therefore predominated the litigation. Furthermore, the district court expressed concern that individualized monetary damages determinations for more than a thousand potential plaintiffs would require multiple juries. This concern, as well as the potential overlap of issues that would be decided in bifurcated proceedings, implicated significant Seventh Amendment, efficiency, and manageability problems.
B
In assessing whether the district court abused its discretion in refusing to certify a (b)(3) class action, we begin with this circuit's most recent case on Rule 23(b)(3) analysis, Castano v. American Tobacco Co., 84 F.3d 734 (5th Cir.1996). Castano makes clear that deciding whether common issues predominate and whether the class action is a superior method to resolve the controversy requires an understanding of the relevant claims, defenses, facts, and substantive law presented in the case. Id. at 744. As we have discussed previously, Patterson holds that the recovery of compensatory and punitive damages in Title VII cases requires individualized and independent proof of injury to, and the means by which discrimination was inflicted upon, each class member. See 90 F.3d at 938-44. The plaintiffs' claims for compensatory and punitive damages must therefore focus almost entirely on facts and issues specific to individuals rather than the class as a whole: what kind of discrimination was each plaintiff subjected to; how did it affect each plaintiff emotionally and physically, at work and at home; what medical treatment did each plaintiff receive and at what expense; and so on and so on. Under such circumstances, an action conducted nominally as a class action would "degenerate in practice into multiple lawsuits separately tried." Castano, 84 F.3d at 745 n. 19 (citing Fed.R.Civ.P. 23 (advisory committee notes)).
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 device in resolving these claims. See id. (explaining that the greater the number of individual issues, the less likely superiority can be established); see also Andrews v. AT & T, 95 F.3d 1014, 1023 (11th Cir.1996). These manageability problems are exacerbated by the fact that this action must be tried to a jury and involves more than a thousand potential plaintiffs spread across two separate facilities, represented by six different unions, working in seven different departments, and alleging discrimination over a period of nearly twenty years. See, e.g., In re Chevron U.S.A., Inc., 109 F.3d 1016, 1018 (5th Cir.1997) (considering the use of bellwether trials to resolve mass torts with widely diverse issues). In order to manage the case, the district court faced the likelihood of bifurcated proceedings before multiple juries.
The plaintiffs attempt to avoid this result by arguing that the common, overarching issue regarding the existence of plant-wide racially discriminatory practices or policies at the Citgo manufacturing complex justifies (b)(3) class certification. This argument, however, fails to appreciate the overwhelming number of individual-specific issues in this case. The Eleventh Circuit recently encountered this situation in rejecting (b)(3) class certification in a race discrimination suit similar to this one. In Jackson v. Motel 6 Multipurpose, Inc., 130 F.3d 999 (11th Cir.1997), plaintiffs alleged that Motel 6 engaged in a nationwide practice of racial discrimination in renting vacant rooms and providing housekeeping services. The district court certified a class action under Rule 23(b)(3). The Eleventh Circuit reversed, holding that class certification was an abuse of discretion.
VII
Finally, the plaintiffs argue that, in the event their claims for compensatory and punitive damages cannot be certified in a class action at this initial stage of the litigation, they are entitled to have some part of this case certified now and tried as a class action to whatever extent permissible under Rule 23. More specifically, as we understand the plaintiffs' argument, they suggest that the court should certify a class action on the disparate impact claim and the first stage of the pattern or practice claim — under Rule 23(b)(2) or 23(b)(3) — and reserve judgment on whether to certify under 23(b)(3) the other claims — including the claims for compensatory
A
(1)
We should make clear from the outset that in asserting this partial certification argument, the plaintiffs have not agreed to drop their claims for compensatory and punitive damages as a class action issue. In making their argument for a tentative, "partial certification," the plaintiffs are relying presumably on the possibility that class-wide discovery and the resolution of the disparate impact claim and first stage of the pattern or practice claim may narrow the issues in the case, which in turn may make later certification of the remaining claims in a (b)(3) class action appropriate. Cf. e.g., Butler v. Home Depot, 70 Fair Empl. Prac. Cas. (BNA) 51 (N.D.Cal.1996) (certifying class action on the first stage of a pattern or practice case and reserving judgment on certification of the second stage). The plaintiffs' choice to preserve the claims for compensatory and punitive damages as a class action issue, however, has significant implications for certification of the remaining issues.
First, we fail to see how certifying the first stage of the pattern or practice claim significantly increases the likelihood that later certification of the second stage of the pattern or practice claim, including the claims for compensatory and punitive damages, would be possible. The second stage of a pattern or practice claim is essentially a series of individual lawsuits, except that there is a shift of the burden of proof in the plaintiff's favor. As the Supreme Court has made clear, there are no common issues between the first stage of a pattern or practice claim and an individual discrimination lawsuit. See Cooper v. Federal Reserve Bank, 467 U.S. 867, 877-80, 104 S.Ct. 2794, 81 L.Ed.2d 718 (1984). As a result, we see no legal basis for the district court to certify a class action on the first stage of the plaintiffs' pattern or practice claim when there is no foreseeable likelihood that the claims for compensatory and punitive damages could be certified in the class action sought by the plaintiffs. Thus, we cannot say that the district court's refusal to grant a partial certification of the first stage of the plaintiffs' pattern or practice claim was an abuse of discretion.
Second, certifying the first stage of the pattern or practice claim under (b)(3) is foreclosed by Castano. We have already held that, when considered as a whole, the plaintiffs' pattern or practice claim in this case implicates predominantly individual-specific issues. We based this holding on the wide
(2)
Consequently, the plaintiffs are left with the possibility of certifying a class action only on the disparate impact claim — again, holding in abeyance the decision whether to certify the pattern or practice claim at a later time. As noted previously, injunctive, declaratory, and other forms of equitable relief such as back pay are available to a disparate impact claimant and in class actions certified under Rule 23(b)(2). Indeed, our cases have held that failure to certify a class action on such claims may amount to an abuse of discretion. See, e.g., Johnson, 491 F.2d at 1375. Furthermore, resolution of the entire disparate impact claim could conceivably narrow the issues to be tried in the pattern or practice claim. It is arguable that the court would have a better understanding of Citgo's employment policies — e.g., which plaintiffs were subjected to which policies in which department or facility, when and for how long. And it may be likely that class members without colorable claims could be identified, which would decrease the size of the class and the number of individual-specific issues. This, in turn, could make the case more manageable as a jury trial and make the class action device a superior method for adjudicating the controversy. Thus, in the context of the plaintiffs' partial certification argument, we will consider the possibility of certifying a class action on the disparate impact claim, with the district court reserving judgment on whether to certify the pattern or practice claim under Rule 23(b)(3) until the disparate impact claim has been resolved.
The standards of Rule 23, however, are not the only limitations on the availability of a class action in this case. As the district court recognized, the right to a jury trial provided by the Civil Rights Act of 1991, and demanded by the plaintiffs, implicates the Seventh Amendment. We therefore consider whether Seventh Amendment concerns preclude a class action on the plaintiffs' disparate impact claim, severed from their pattern or practice claim.
B
The Seventh Amendment preserves the right to a jury trial "in Suits at common law." U.S. Const. amend. VII. This right encompasses all actions in which legal rights are to be determined, as opposed to those in which only equitable rights and remedies are involved. Cox v. C.H. Masland & Sons, Inc., 607 F.2d 138, 142 (5th Cir.1979) (citing Ross v. Bernhard, 396 U.S. 531, 90 S.Ct. 733, 24 L.Ed.2d 729 (1970)). Of course,
Because the statute expressly provides that compensatory and punitive damages are not available in disparate impact claims, see § 1981a(a)(1), the right to a jury trial under Title VII extends only to the plaintiffs' pattern or practice claim, see § 1981a(c).
The Federal Rules of Civil Procedure also act to protect the parties' right to a jury trial, once one is demanded, on the claims for compensatory and punitive damages. Rule 38(d) provides that once a party has demanded a jury trial, the demand cannot be withdrawn without the consent of both parties.
Resolution of the disparate impact claim and of equitable remedies must nevertheless take into account the Seventh Amendment. When claims involving both legal and equitable rights are properly joined in a single case, the Seventh Amendment requires that all factual issues common to these claims be submitted to a jury for decision on the legal claims before final court determination of the equitable claims. Roscello v. Southwest Airlines Co., 726 F.2d 217, 221 (5th Cir.1984) (citing Dairy Queen, Inc. v. Wood, 369 U.S. 469, 479, 82 S.Ct. 894, 8 L.Ed.2d 44 (1962)); see also Ross, 396 U.S. at 537-38, 90 S.Ct. 733. In this case, both parties have a Seventh Amendment right to have a jury determine all factual issues necessary to establish the plaintiffs' pattern or practice claim, a claim for legal damages that they have properly joined in the same action with a disparate impact claim for equitable relief. As a result, each factual issue common to these claims,
C
In deciding whether the district court should have temporarily severed the disparate impact claim for class treatment, we must ascertain whether this claim shares any factual issues with the pattern or practice claim, which both parties are entitled to have decided first by a jury.
Because the same employment policies and practices are challenged under both claims,
738 F.2d 1249, 1268-70 (D.C.Cir.1984), cert. denied, 471 U.S. 1115, 105 S.Ct. 2357, 86 L.Ed.2d 258 (1985); see also Fentonmiller, Damages, Jury Trials and the Class Action under the Civil Rights Act of 1991, 12 Lab. Law. 421, 438-46 (1997).
Similarly, the business necessity defense to disparate impact claims and the legitimate nondiscriminatory reason defense to disparate treatment claims are not "so distinct and separable" from one another that they may be considered separately by multiple factfinders without violating the Seventh Amendment. See Gasoline Prod. Co. v. Champlin Refining Co., 283 U.S. 494, 500, 51 S.Ct. 513, 75 L.Ed. 1188 (1931). To rebut the plaintiffs' claim that any one of Citgo's challenged employment practices resulted in a disparate impact, Citgo would have to establish that the "challenged practice is job-related for the position in question and consistent with business necessity." 42 U.S.C. § 2000e2(k)(1)(A)(I). It is the rare case indeed in which a challenged practice is job-related and a business necessity, yet not a legitimate nondiscriminatory reason for an adverse employment action taken pursuant to that practice. Thus, a finding that a challenged practice is job related and a business necessity in response to a disparate impact claim strongly, if not wholly, implicates a finding that the same practice is a legitimate nondiscriminatory reason for the employer's actions in a pattern or practice claim. These issues are questions of fact, see, e.g., St. Mary's Honor Ctr. v. Hicks, 509 U.S. 502, 524, 113 S.Ct. 2742, 125 L.Ed.2d 407 (1993); Wards Cove Packing Co. v. Atonio, 490 U.S. 642, 660, 109 S.Ct. 2115, 104 L.Ed.2d 733 (1989), common to the plaintiffs' disparate impact and pattern
In sum, the existence of factual issues common between the plaintiffs' disparate impact and pattern or practice claims precludes trial of the disparate impact claim in a class action severed from the remaining nonequitable claims in the case. The claims for injunctive relief, declaratory relief, and any equitable or incidental monetary relief cannot be litigated in a class action bench trial (in the same case prior to certification of any aspects of the pattern or practice claim) without running afoul of the Seventh Amendment. See Roscello, 726 F.2d at 221. Nor may they be advanced in a subsequent class action without being barred by res judicata and collateral estoppel, see Montana v. United States, 440 U.S. 147, 153, 99 S.Ct. 970, 59 L.Ed.2d 210 (1979); Nilsen v. City of Moss Point, 701 F.2d 556, 559-64 (5th Cir.1983) (en banc), because all of the common factual issues will already have been decided, or could have been decided, in the prior litigation. The district court, therefore, did not abuse its discretion in denying partial certification in a temporarily severed class action nor in denying class certification on any or all aspects of this case.
VIII
In summary, we hold that nonequitable monetary relief may be obtained in a class action certified under Rule 23(b)(2) only if the predominant relief sought is injunctive or declaratory. Claims for such monetary relief predominate unless they are incidental to related claims for injunctive or declaratory relief. Incidental damages are damages that flow directly from liability to the class as a whole on claims forming the basis of the injunctive or declaratory relief. Because the district court adopted the correct standard for certifying class actions under Rule 23(b)(2), and correctly applied that standard in finding that the plaintiffs' claims for compensatory and punitive damages are not incidental damages in this case, it did not abuse its discretion in denying (b)(2) class certification of these claims. Furthermore, because these claims require individualized proof and determinations, the district court did not err in finding that issues common to the proposed class do not predominate over those affecting only individual plaintiffs and that a class action would not be a fair and efficient method for adjudicating these claims. The
In accordance with the above-stated reasons, the judgment of the district court is
AFFIRMED.
DENNIS, Circuit Judge, dissenting:
I respectfully dissent.
The majority incorrectly holds that African Americans who claim to have been harmed by Citgo's alleged unlawful racially discriminatory employment policies and practices cannot bring a class action under Federal Rule of Civil Procedure 23(b)(2) to enforce collectively their rights and remedies afforded for such violations under both the 1991 Civil Rights Act and Title VII of the 1964 Civil Rights Act.
The primary purposes of Title VII are to deter and abolish racial and other discrimination in employment and to make discriminatees whole. By the 1991 Civil Rights Act, Congress expressly intended to further these goals more effectively by affording in a Title VII action limited compensatory and punitive damage remedies to disparate treatment victims. The majority concludes, however, that the legislative intent of the 1991 Civil Rights Act cannot be effectuated in a Rule 23(b)(2) class action.
The majority reaches this conclusion by erroneously interpreting Rule 23(b)(2) as disallowing certification of a class action under that subdivision whenever the plaintiffs seek compensatory or punitive damages for individual members of the class in addition to injunctive and declaratory relief. The majority's preclusive interpretation is built on nothing more than its own assertion that, in effect, the prayer for such damages gives rise to a conclusive or irrebuttable presumption that the final relief sought by the plaintiffs relates exclusively or predominantly to money damages, rather than to the final injunctive relief or corresponding declaratory relief with respect to the class as a whole.
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 a class, and Rule 23(b)(2)'s proven effectiveness and unique appropriateness in civil rights cases, especially Title VII actions. Rule 23 plainly limits this court's judicial inventiveness; we have no authority to require a district court to automatically disallow (b)(2) certification simply because a member of the class seeks compensatory or punitive damages in addition to final injunctive relief. Rather, Rule 23 obliges the trial court to conduct a rigorous analysis, often necessarily probing behind the pleadings, before exercising its own broad discretion within the framework of the rule to decide whether to certify a class.
I.
The majority opinion introduces a new interpretation of Rule 23(b)(2) which provides, in effect, that a class action cannot be certified under that subdivision when the plaintiffs seek individual compensatory or punitive damages in addition to injunctive or declaratory relief under Title VII. That interpretation is based on a circuitous rationale: (i) a claim for monetary relief automatically predominates and defeats certification of a (b)(2) class unless it is "incidental" to requested injunctive or declaratory relief; (ii) "incidental" damages are those that flow directly and automatically from liability to the class as a whole on the claims forming the basis of the injunctive or declaratory relief; (iii) "incidental" damages are those that do not require additional hearings to resolve the merits of each individual's case and that do not introduce new and substantial legal or factual issues or complex individualized determinations; (iv) except that, a request for individualized back pay awards under Title VII may be included without defeating certification of
The majority states that under its rule the district courts have discretion to decide whether monetary damages sought are "incidental." However, the majority's definition of "incidental damages" unquestionably excludes all individual compensatory and punitive damages. Consequently, under the majority's rule a district court cannot certify a (b)(2) class action suit seeking any such damages without committing an abuse of discretion or an error of law. Therefore, the trial court's discretion to determine whether damages are "incidental" is illusory. Because of this formulation, trial courts in this circuit will, in fact, have no discretion to certify a (b)(2) class where individual compensatory and punitive damage claims are sought.
A.
The majority's rule absolutely precluding compensatory and punitive damages claims in (b)(2) class actions patently conflicts with or does not demonstrably further the basic purposes served by class action suits. The fundamental aims of class actions are (1) "to promote judicial economy and efficiency by obviating the need for multiple adjudications of the same issues[,]" 5 JAMES WM. MOORE, MOORE'S FEDERAL PRACTICE § 23.02 (3d ed.1998) (citing General Tel. Co. of Southwest v. Falcon, 457 U.S. 147, 156, 102 S.Ct. 2364, 72 L.Ed.2d 740 (1982) and American Pipe & Constr. Co. v. Utah, 414 U.S. 538, 553, 94 S.Ct. 756, 38 L.Ed.2d 713 (1974)), (2) "to afford aggrieved persons a remedy if it is not economically feasible to obtain relief through ... multiple individual damage actions[,]" id. (citing Deposit Guar. Nat. Bank v. Roper, 445 U.S. 326, 339, 100 S.Ct. 1166, 63 L.Ed.2d 427 (1980); Amchem Prods., Inc. v. Windsor, ___ U.S. ___, ___, 117 S.Ct. 2231, 2246, 138 L.Ed.2d 689 (1997)("the very core of the class action mechanism is to overcome the problem that small recoveries do not provide the incentive for any individual to bring a solo action prosecuting his or her rights. A class action solves this problem by aggregating the relatively paltry potential recoveries into something worth someone's (usually an attorney's) labor.")(quoting Mace v. Van Ru Credit Corp., 109 F.3d 338, 344 (7th Cir. 1997)); Phillips Petroleum Co. v. Shutts, 472 U.S. 797, 809, 105 S.Ct. 2965, 86 L.Ed.2d 628 (1985)), (3) to enhance access to the courts "by spreading litigation costs among numerous litigants with similar claims[,]" id. (citing United States Parole Comm'n v. Geraghty, 445 U.S. 388, 402-403, 100 S.Ct. 1202, 63 L.Ed.2d 479 (1980)), (4) "[to protect] the defendant from inconsistent adjudications[,]" id., and (5) "to ensure ... that the interests of absentee class members are considered fairly and adequately," id. (citing Hansberry v. Lee, 311 U.S. 32, 42-43, 61 S.Ct. 115, 85
Rule 23's requirements for class action suits should be interpreted in light of the basic purposes of the rule. In re A.H. Robins Co., 880 F.2d 709, 740 (4th Cir.), cert. denied, 493 U.S. 959, 110 S.Ct. 377, 107 L.Ed.2d 362 (1989); see also Mace, 109 F.3d at 344; Andrews v. Amer. Tel. & Tel. Co., 95 F.3d 1014, 1025 (11th Cir.1996); 5 MOORE, supra, at § 23.04.
The majority fails to demonstrate that its rigid bright-line rule will further the basic purposes of Rule 23 class action suits. On the contrary, it is self-evident that the application of such an inflexible, arbitrary rule frequently will disallow (b)(2) class action suits seeking predominantly final injunctive relief and only secondarily damages, and thus derogate from the class action goals of judicial economy and efficiency; affording aggrieved persons a remedy not otherwise economically feasible; enhancing access to courts by spreading costs; and protecting defendants from inconsistent adjudications.
B.
The majority's rule sharply conflicts with the text, advisory notes and underlying policies of Rule 23(b)(2) in several important respects.
Rule 23(b)(2) provides, in pertinent part, that "[a]n action may be maintained as a class action if the prerequisites of subdivision (a) are satisfied, and in addition ... 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[.]" The rule plainly does not say that a class (b)(2) may not be certified if the parties seeking injunctive relief or corresponding declaratory relief also pray for individual compensatory or punitive damages. See Parker v. Local Union No. 1466, 642 F.2d 104, 107 (5th Cir.1981)("Class certification under Rule 23(b)(2) does not automatically preclude an award of monetary damages when the primary relief sought is injunctive or declaratory. The rule pointedly refers to injunctive or declaratory relief but does not, in terms, preclude monetary relief.")
The Advisory Committee Notes on Rule 23(b)(2), in pertinent part, state that "[t]his subdivision is intended to reach situations where a party has taken action or refused to take action with respect to a class, and final relief of an injunctive nature or of a corresponding declaratory nature, settling the legality of the behavior with respect to the class as a whole, is appropriate.... The subdivision does not extend to cases in which the appropriate final relief relates exclusively or predominantly to money damages." FED. R. CIV. P. 23 advisory committee's note (discussing Subdivision (b)(2) under 1996 Amendments). The advisory note does not state that a Rule (b)(2) class may not extend to cases in which a plaintiff seeks money damages. The advisory exclusion applies only to cases in which (i) the appropriate final relief (ii) relates exclusively or predominantly (iii) to money damages. In other words, if the plaintiffs seek relief of an injunctive nature temporarily or not as the final relief for the whole class but instead seek a final relief relating exclusively or predominantly to money damages, a (b)(2) class would not be appropriate. In fact, a plain reading of the advisory note clearly indicates that money damages may be sought in a (b)(2) class action along with final injunctive relief so long as money damages are not be the exclusive or predominant relief sought.
Even if one disregards the text of Rule 23(b)(2) and focuses only on the Advisory Committee Note, the majority's extrapolation of a rule therefrom, arbitrarily barring (b)(2) certification if the plaintiffs seek any compensatory damages to make individual members of the class whole, is unwarranted. The plain language of the note does not support the formulation of such a rule and its sweeping preclusion of certification of all cases involving compensatory or punitive damages conflicts with the specifications and the clear intent and concerns of the drafters of the rule.
The Advisory Committee pointed to, as the outstandingly clear or typical example or archetype of a case eligible for (b)(2) certification, "actions in the civil-rights field where a
The Advisory Committee, in stating that the (b)(2) class "does not extend to cases in which the appropriate final relief relates exclusively or predominantly to money damages," most certainly did not have in mind the incongruous meaning derived from the commentary by the majority, i.e. an absolute, inflexible rule precluding (b)(2) certification when the plaintiffs seek to recover compensatory or punitive damages regardless of the nature or significance of the class-wide final injunctive relief sought. In referring to a case in which "the appropriate final relief relates exclusively or predominantly to money damages" the Advisory Committee may have intended to exclude situations in which the plaintiffs either do not seek final injunctive relief for the whole class or do so only as a sham to obtain easier certification for what is truly only an action for money damages. Or the committee may have meant for the court to compare the quantity and quality of the injunctive and monetary remedies in the particular case to see which was predominant, a consideration that has been at least suggested by this court, see Jenkins, 400 F.2d at 32-33. ("Considering that in this immediate field of labor relations what is small in principal is often larger in principle, [the claim to remedy class-wide discriminatory employment practices] has extreme importance with heavy overtones of public interest."), and yet, would be precluded by the majority's strict no plenary damages rule.
The assessment of the value of each remedy sought in a particular class action suit is problematic. However, the majority's no-damage-claim-or-no-certification rule precludes
C.
The majority's rule improperly prevents the exercise of informed, sound judicial discretion by a trial court to determine that in a particular Title VII class action suit the positive weight or value of the injunctive or declaratory relief sought is predominant even though compensatory or punitive damages are also claimed. The majority's judicially invented limitation upon the district court's power is contrary to Rule 23, the congressional drafters' and reviewers' intent, and the well-established precedents of the Supreme Court and this court.
Rule 23(b)(2) provides that "[a]n action may be maintained as a class action if the prerequisites of subdivision (a) are satisfied, and in addition [] 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[.]" The text of the rule does not contain a predominance requirement or purport to grant a district court the discretion to deny certification if the prerequisites of (a) and (b)(2) are satisfied. The Advisory Committee Note that subdivision (b)(2) "does not extend to cases in which the appropriate final relief relates exclusively or predominantly to money damages" implies an intention to vest the trial court with the discretion to deny certification in such cases. Rule 23(c)(1) provides that "[a]s soon as practicable after the commencement of an action brought as a class action, the court shall determine by order whether it is to be so maintained." Thus, the discretion to determine whether money damages predominate in a particular case, requiring that it not be maintained as a (b)(2) class action, is clearly delegated to the district court as part of its certification function. There is simply no justification for an appellate court to use the Advisory Committee Note as a pretext for formulating a judicial rule that nullifies the district court's legislatively granted authority or discretion in this respect. Cf. 1 HEBERT B. NEWBERG & ALBA CONTE, NEWBERG ON CLASS ACTIONS § 4.14, at 4-49 (3d ed. 1992) ("No clear standards have or could be developed ... in this area so pregnant with judicial discretion.") (emphasis added).
The Supreme Court, in Amchem Products, Inc. v. Windsor, ___ U.S. ___, ___, 117 S.Ct. 2231, 2235, 138 L.Ed.2d 689 (1997), held that federal courts "lack authority to substitute for Rule 23's certification criteria a standard never adopted by the rulemakers — that if a settlement is `fair,' then certification is proper." Thus, the majority exceeds the limits of its judicial power by substituting for the certification criteria a rule based on its own definition of terms in the Advisory Committee Note that in effect usurps the district court's legislated authority to perform its certification function. For, as the Supreme Court admonished:
Id.
We have found no other circuit court that has adopted a jurisprudential rule completely barring (b)(2) certification when compensatory damages are sought as well as final injunctive relief. The majority cites Williams v. Owens-Illinois, Inc., 665 F.2d 918 (9th Cir.), cert. denied, 459 U.S. 971, 103 S.Ct. 302, 74 L.Ed.2d 283 (1982), as being in accord with its position. But the Ninth Circuit did not adopt such a rule in that case. Rather, it merely affirmed the trial court's exercise of discretion in limiting the issues in a class action to claims for injunctive relief, although the plaintiffs had also prayed for compensatory damages. Id. at 928-29. In fact, if the textual prerequisite of Rule 23(a) and (b)(2) have been satisfied, many courts and leading commentators favor either leaving the trial court's discretion untrammeled or using a variety of flexible and practical approaches that encourage the certification of some type of class even when money damages are sought along with final injunctive relief.
The rule adopted by the majority in the present case exceeds the bounds of its authority because it usurps the district courts' authority granted by Rule 23 (when a member of a class seeks to maintain a class action under (b)(2) for both final injunctive relief and compensatory or punitive damages) to rigorously analyze the case, probe behind the pleadings if necessary, and exercise its own discretion within the framework of the rules in determining whether the action is to be so maintained.
D.
By adopting an absolute rule against compensatory or punitive damages claims in (b)(2) class actions, the majority ignores the intent of the drafters of Rule 23 that class actions against discriminatory employment practices would be maintained under (b)(2). The majority's rule, contrary to the intent of the drafters and Congress, threatens a drastic curtailment of the use of (b)(2) class actions in the enforcement of Title VII and other civil rights acts.
Courts routinely have certified Title VII class actions under Rule 23(b)(2) on the theory
This court and others have held that a (b)(2) class is appropriate in a Title VII suit where both final injunctive and monetary relief are granted. See Franks v. Bowman Transp. Co., 495 F.2d 398, 422 (5th Cir.1974); Pettway v. American Cast Iron Pipe Co., 494 F.2d 211, 257 (5th Cir.1974); Johnson v. Goodyear Tire & Rubber Co., 491 F.2d 1364, 1375 (5th Cir.1974); Robinson v. Lorillard Corp., 444 F.2d 791, 801-802 (4th Cir.1971); Bowe, 416 F.2d at 720. The basic nature of a Title VII suit has not been altered merely because the plaintiff may also pray for compensatory or punitive damages, if money damages are not the exclusive or dominant relief sought.
After the 1991 Civil Rights Act the thrust of a Title VII action continues to be society's interest in eliminating discrimination and the individual's interest in being made whole. H.R.Rep. No. 102-40(I), at 64-65, reprinted in 1991 U.S.C.C.A.N. 549, 602-03. Title VII plaintiffs may still seek extensive and systematic injunctive relief for claims that arise from a system of employment action that has been uniformly imposed based on a characteristic common to all class members, such as race. Therefore, "[t]he conduct of the employer is still answerable `on grounds generally applicable to the class,' and the primary relief sought is still `relief with respect to the class as a whole,'" Wetzel, 508 F.2d at 251, even when nonpredominant money damages are sought. Cf. Thomas v. Albright, 139 F.3d 227, 1998 WL 135494, 234-35 (D.C.Cir. 1998) (assumption of cohesiveness underlying certification of a (b)(2) class is not necessarily destroyed when claims for injunctive relief are coupled with individual claims for monetary damages).
As this court stated in Pettway v. American Cast Iron Pipe Co., 494 F.2d 211, 257 (5th Cir.1974):
Citgo's employment practices and policies were alleged to be such that final injunctive relief was appropriate. The text of Rule 23(b)(2) requires nothing more. The nature of those alleged racially discriminatory policies, and the nature of the class opposing those policies does not change merely because the plaintiffs also seek monetary damages if they are not the exclusive or predominant relief sought. Cf. Wetzel, 508 F.2d at 251.
II.
Because I disagree fundamentally with the path followed by the majority and the district court in interpreting and applying Rule 23(b)(2), I see no need to address the particular Seventh Amendment problems that might arise under the application of their erroneous interpretation of the rule. If, upon remand, the district court were to certify a class action after applying the correct principles of law, care must be taken to accommodate the parties' rights to a jury trial of the compensatory and punitive damages issues with the court's trial of the injunctive and declaratory
Title VII class actions for disparate treatment have traditionally been conducted in two stages. In Baxter v. Savannah Sugar Refining Corp., 495 F.2d 437, 443-44 (5th Cir.1974), this court explained the bifurcation of a Title VII class action as follows:
Id. at 443-44. See International Brotherhood of Teamsters v. United States, 431 U.S. 324, 360, 97 S.Ct. 1843, 52 L.Ed.2d 396 (1977); Franks v. Bowman Transp., 424 U.S. 747, 772, 96 S.Ct. 1251, 47 L.Ed.2d 444 (1976).
This approach allows the court and the jury to focus on the employment practices of the employer as they affect the defendant's liability to the class during the liability stage. Cf. 6 NEWBERG, supra, § 24.122, n. 1000 (citing Swint v. Pullman-Standard, 539 F.2d 77 (5th Cir.1976); United States v. United States Steel Corp., 520 F.2d 1043 (5th Cir. 1975)). If the class does establish to the satisfaction of the jury that policies or practices of discrimination exist, the jury may then resolve in a stage II proceeding whether individual class members are entitled to receive compensatory or punitive damages and the quantum of any award. Cf. Id.
Because equitable relief and legal claims may depend on common issues of fact, the court must allow the jury to determine in stage I the issue of legal liability to the class before the court determines whether the class is entitled to injunctive or declaratory relief. See Dairy Queen v. Wood, 369 U.S. 469, 479-480, 82 S.Ct. 894, 8 L.Ed.2d 44 (1962). Also, in stage II, the court must clearly instruct the jury that it is not to revisit the issues decided by the jury in the first phase as to whether the defendant had an employment policy of unlawful discrimination but must decide only the issues of whether individual plaintiffs are entitled to compensatory or punitive damages. See Gasoline Products Co., Inc. v. Champlin Refining Co., 283 U.S. 494, 51 S.Ct. 513, 75 L.Ed. 1188 (1931)
Because the issue of whether an individual employee has been damaged by the employer's intentional discriminatory conduct is separate and distinct from the issue of whether the employer had an unlawful discriminatory practice or policy so that, with adequate instructions and guidance by the court, a trial of it alone may be had without injustice, the Seventh Amendment does not prohibit the separate jury trials of those issues. See id. That is, the issues may be divided between separate trials if done "in such a way that the same issue is [not] reexamined by different juries." In re Rhone-Poulenc, 51 F.3d 1293, 1303 (7th Cir.1995); see also Castano v. American Tobacco Co., 84 F.3d 734, 750 (5th Cir.1996)("Thus, Constitution allows bifurcation of issues that are so separable that the second jury will not be called upon to reconsider findings of fact by the first."); Alabama v. Blue Bird Body Co., 573 F.2d 309, 318 (5th Cir.1978) ("[I]nherent in the Seventh Amendment guarantee of a trial by jury is the general right of a litigant to have only one jury pass on a common issue ... ").
In other words, the bifurcated phases of a Title VII class action contemplate separate and distinct issues. The first stage of a Title VII class action focuses exclusively on classwide claims, Price Waterhouse v. Hopkins, 490 U.S. 228, 245 n. 10, 109 S.Ct. 1775, 104 L.Ed.2d 268 (The focus in Stage I is "`not [] on [the] individual hiring decisions, but on a pattern of discriminatory decisionmaking.'") (quoting Cooper v. Federal Reserve Bank of Richmond, 467 U.S. 867, 876, 104 S.Ct. 2794, 81 L.Ed.2d 718 (1984)), whereas the second stage focuses on individual claims.
In summary, I respectfully dissent from the majority opinion because it adopts an unauthorized and erroneous interpretation of Rule 23(b)(2), affirms the district court decision based on the same error of law, and raises constitutional questions that would not be encountered under a correct interpretation and application of the rule.
Before JOLLY, SMITH and DENNIS, Circuit Judges.
ON PETITION FOR REHEARING EN BANC
Oct. 2, 1998
PER CURIAM:
Treating the suggestion for rehearing en banc as a petition for panel rehearing, the petition for panel rehearing is DENIED. In denying rehearing, the panel majority makes the following observation: 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. Judge Dennis dissents from the denial of panel rehearing.
The court having been polled at the request of one of its members and a majority of the judges who are in regular active service not having voted in favor (see FED.R.APP.P. 35, 5TH CIR.R. 35), the suggestion for rehearing en banc is DENIED.
FootNotes
Id. at 1092.
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