Davis v. U.S. Steel Supply, Div. of U.S. Steel Corp.

• Decision Date: 30 August 1982
• Docket Number: No. 80-2571,80-2571
• Citation: 688 F.2d 166
• Parties: 29 Fair Empl.Prac.Cas. 1202, 30 Empl. Prac. Dec. P 33,045 Thelma DAVIS v. UNITED STATES STEEL SUPPLY, DIVISION OF UNITED STATES STEEL CORPORATION, Appellant.
• Court: U.S. Court of Appeals — Third Circuit

Page 166

688 F.2d 166

29 Fair Empl.Prac.Cas. 1202,

30 Empl. Prac. Dec. P 33,045

Thelma DAVIS v. UNITED STATES STEEL SUPPLY, DIVISION OF UNITED STATES STEEL CORPORATION, Appellant.

No. 80-2571.

United States Court of Appeals Third Circuit.

Argued May 18, 1981.

Resubmitted March 16, 1982.

Decided Aug. 30, 1982.

Robert X. Medonis (argued), Pittsburgh, Pa., for appellee.

Richard F. Lerach (argued), Pittsburgh, Pa., for appellant.

Argued May 18, 1981

Before GIBBONS, HUNTER and GARTH, Circuit Judges.

Resubmitted March 16, 1982

Before SEITZ, Chief Judge, and ALDISERT, ADAMS, GIBBONS, HUNTER, WEIS, GARTH, HIGGINBOTHAM, SLOVITER and BECKER, Circuit Judges.

OPINION OF THE COURT

ADAMS, Circuit Judge.

In this appeal from a district court judgment in favor of plaintiff Thelma Davis under 42 U.S.C. § 1981, United States Steel Corporation (U. S. Steel) raises a number of troublesome as well as important issues. Among these issues one question must, as a prerequisite to the adjudication of the remainder, take precedence: the res judicata effect upon this action of a prior Pennsylvania court judgment with respect to the allegedly discriminatory discharge of Thelma Davis by U. S. Steel. We conclude that further litigation of Davis' claim is barred by res judicata.

I

Thelma Davis, a black woman, commenced her employment with the Steel Supply Division of the United States Steel Corporation on May 5, 1966. She worked as a Flexograph operator and was the first black office employee of the Supply Division's Reedsdale Street location. She had been employed by U. S. Steel for almost four years when she was terminated on February 3, 1970.

During her tenure with U. S. Steel, Davis experienced difficulties with fellow employees. Tension developed between Davis and two other women employees in the Flexograph Room. At least one of these women complained to Boris Pishko, their immediate supervisor, that Davis was uncooperative.

Davis, in turn, submitted a letter to Beecher Taylor, Pishko's supervisor, complaining of numerous incidents involving co-workers. Some of these complaints were racial in nature. As a result of these and other actions, at Taylor's direction, Pishko talked to Davis and several other employees in an effort to restore office harmony.

These efforts were to no avail, at least so far as the Flexograph room was concerned, and in early 1969 Pishko moved Davis to the file room. The record is equivocal as to whether Davis' problems continued in this department. On the morning of February 3, 1970, however, Pishko, as a result of complaints made by co-workers, requested that Davis use less perfume on her person. Davis was offended by this request and complained to Paul Sykes, the acting district manager and Pishko's then supervisor. Later that day, Davis discovered that one of her boots was torn, and attributed that action to her fellow employees. She complained to Pishko that the torn boot was another example of the type of harassment she was suffering. During a tempestuous discussion, Davis left Pishko's office and refused his requests that she return. Pishko then went to Sykes, and, after informing him of the events that had transpired, asked Sykes to discharge Davis. Davis was thereupon called to Sykes' office and discharged. She alleges, and Sykes denies, that Sykes told her, among other things, that her discharge was for "her safety's sake."

Davis complained to the City of Pittsburgh Commission on Human Relations (PCHR) on February 4, 1970, the day after her discharge. She claimed that an atmosphere of racial intolerance was maintained at U.S. Steel; that she had been subjected to harassment by fellow employees during the last three years of her employment; that her complaints to supervisors had largely been ignored; that she had been improperly discharged; and that her discharge occurred after Taylor, who had been sensitive to her complaints, was transferred to another city.

The Commission conducted a full adversarial hearing regarding Davis' complaint on June 4, 1971. Nine witnesses-Davis among them-testified and were subjected to cross-examination. The PCHR issued its decision on March 6, 1972 and found that U.S. Steel had violated Section 8(a) of the Pittsburgh Human Relations Ordinance because it had treated Davis differently from the way it treated other employees. ¹ The PCHR accordingly ordered U.S. Steel to cease and desist from racial discrimination, to reinstate Davis, and to award her back pay. A supplemental order of October 2, 1972 specified the amount of damages.

U.S. Steel appealed that decision under 53 Pa.Stat.Ann. §§ 11307, 11308 (Purdon 1972) ² to the Allegheny County Court of Davis did not appeal that decision to any higher Pennsylvania court; nor, of course, did U.S. Steel. Instead, Davis filed suit in the United States District Court for the Western District of Pennsylvania on August 13, 1975, alleging that her discharge by U.S. Steel constituted a violation of 42 U.S.C. § 1981. In her federal complaint, Davis alleged that she was subjected to a pattern of discrimination consisting of racial slurs and racially motivated harassment, and that she was unlawfully dismissed from her employment. She sought damages to compensate her for lost wages, fringe benefits, and pension rights, as well as costs and attorneys fees. Initially, the district court held that her claim was time-barred, 405 F.Supp. 394 (W.D.Pa.1976). A panel of this Court reversed that determination and held that the complaint was timely. It held that, "where the gist of a § 1981 complaint concerns racially discriminatory discharge of an employee under the facts in this record," then the applicable Pennsylvania statute of limitation is 12 P.S. § 31, which provides a six year period. ³ Davis v. United States Steel Supply, Division of United States Steel Corporation, 581 F.2d 335, 341 n.8 (3d Cir. 1978). In its opinion the panel noted that "(t)he res judicata force of state judicial review of local administrative adjudications depends on a variety of factors which have not been developed in the record in this case"; the Court therefore specifically refrained from expressing any view at that time as to the res judicata effect to be accorded to the Commonwealth Court's decision in Davis' subsequent section 1981 action. 581 F.2d at 340 n.5. The panel, however, did not have the advantage of the clarification of the law that the Supreme Court recently supplied in Kremer v. Chemical Construction Corp., --- U.S. ----, 102 S.Ct. 1883, 72 L.Ed.2d 262 (1982).

Common Pleas, which concluded that the PCHR's decision was supported by substantial evidence and was neither arbitrary not capricious. The Common Pleas Court therefore dismissed the appeal. U.S. Steel appealed that determination to the Commonwealth Court of Pennsylvania. In a unanimous opinion the Commonwealth Court reversed the Court of Common Pleas and held, after carefully reviewing the record, that there was inadequate support for the conclusion that the Pittsburgh ordinance had been violated. The court focused on the issue of discriminatory discharge, but clearly indicated in its opinion that it understood that there were also broader charges of racial discrimination in the case. The court stated that "(t)he crucial issue involved in this case is whether or not Davis was treated differently by the Supply Division because of her race." The court concluded that "(t)he findings offer no information concerning how the Supply Division discriminated 'in dismissing Mrs. Davis' and therefore do not support the Commission's conclusion." It also determined that the Commission's finding that Davis' supervisor gave little credence to Davis' complaints was not supported by the evidence. The court also considered a charge that Davis was discriminated against because of the manner in which her file was kept; but it found no evidence that her file was treated differently before her discharge, and considered the post-discharge differences normal for an employer facing a lawsuit. The Commonwealth Court held that there were no findings supported by substantial evidence that U.S. Steel had treated Davis differently because of her race, and accordingly entered a judgment vacating the orders of the PCHR. United States Steel Supply Division of United States Steel Corp. v. City of Pittsburgh, 16 Pa.Commw. 425, 332 A.2d 871 (1975).

On remand, the district court denied U.S. Steel's motion for summary judgment on res judicata grounds and held that the Pennsylvania Commonwealth Court judgment was not a bar to the federal claim. In its order of February 13, 1979, the district court stated, without lengthy explanation, that "res judicata does not foreclose the instant action where (after an initial administrative decision the) defendant has pursued state appellate remedies rather than the plaintiff." Appendix at 305. It cited in support of that proposition the Second Circuit line of cases following Mitchell v. National Broadcasting Co., 553 F.2d 265, 275 (2d Cir. 1977). The district court's decision, like that of the initial panel, antedated the Supreme Court's Kremer decision.

After the denial of the summary judgment motion, the matter was tried on the merits before the district judge sitting without a jury. By stipulation of both parties and with the consent of the court, the evidence in the federal court proceeding was limited to the PCHR record and a deposition of Davis. ⁴ On the basis of that evidence, the district court concluded in a Memorandum Opinion and Order of October 19, 1979 that U.S. Steel had discharged Davis in violation of 42 U.S.C. § 1981. The court rested this conclusion on a finding that U.S. Steel "practiced racial discrimination in discharging Davis," explaining that the record did not support any of the other motivations for dismissal that were alleged by U.S. Steel. The district court appears to have based its decision solely on the finding of discriminatory discharge,...