825 F.2d 458 (D.C. Cir. 1987), 85-6052, Hopkins v. Price Waterhouse

Docket Nº:85-6052, 85-6097.
Citation:825 F.2d 458
Party Name:Ann B. HOPKINS, Appellant, v. PRICE WATERHOUSE. Ann B. HOPKINS v. PRICE WATERHOUSE, Appellant.
Case Date:August 04, 1987
Court:United States Courts of Appeals, Court of Appeals for the District of Columbia Circuit
 
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825 F.2d 458 (D.C. Cir. 1987)

Ann B. HOPKINS, Appellant,

v.

PRICE WATERHOUSE.

Ann B. HOPKINS

v.

PRICE WATERHOUSE, Appellant.

Nos. 85-6052, 85-6097.

United States Court of Appeals, District of Columbia Circuit

August 4, 1987

Argued Oct. 23, 1986.

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[Copyrighted Material Omitted]

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James H. Heller, with whom Douglas B. Huron, Washington, D.C., was on brief, for appellant in No. 85-6052 and cross-appellee in No. 85-6097.

Stephen R. Tallent, with whom Wayne A. Schrader and Kathy Davidson Ireland, Washington, D.C., were on brief, for appellee in No. 85-6052 and cross-appellant in No. 85-6097.

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Before EDWARDS and WILLIAMS, Circuit Judges, and JOYCE HENS GREEN, [*] District Judge.

Opinion for the Court filed by District Judge JOYCE HENS GREEN.

Dissenting opinion filed by Circuit Judge WILLIAMS.

JOYCE HENS GREEN, District Judge:

In Hishon v. King & Spalding, 467 U.S. 69, 104 S.Ct. 2229, 81 L.Ed.2d 59 (1984), the Supreme Court ruled for the first time that decisions concerning advancement to partnership are governed by Title VII, 42 U.S.C. Sec. 2000e, et seq., and must therefore be made without regard to race, sex, religion, or national origin. This case, the first challenge to a partnership denial to reach us since Hishon, presents several novel and important questions that arise from the application of federal employment discrimination law to collegial bodies such as partnerships. Following a five-day trial, the District Court found that Price Waterhouse, one of the nation's largest accounting firms, had discriminated against plaintiff Ann Hopkins by permitting stereotypical attitudes towards women to play a significant, though unquantifiable, role in its decision not to invite her to become a partner. The court concluded that Hopkins was entitled to an award of backpay from the date she should have been elected partner until the date of her resignation seven months later, but ruled that, notwithstanding the parties' agreement to defer consideration of damages until after a decision on the issue of liability, Hopkins' failure to present any evidence as to the amount of compensation she was due barred her from recovering all damages save attorneys' fees. The trial court further found that Hopkins had failed to establish that she had been constructively discharged following Price Waterhouse's failure to make her a partner, and thus declined to award her backpay for the period subsequent to her resignation or to order Price Waterhouse to invite her to become a partner. The parties cross-appealed. 1 For the reasons set forth below, we affirm the District Court's determination of liability, but reverse its judgment as to the appropriate relief and remand for further proceedings on this issue.

I.

  1. Background

    Price Waterhouse is a professional partnership specializing in auditing, tax, and management consulting services, primarily for private corporations and government agencies. The firm is known colloquially as one of the nation's "big eight" accounting firms; at the time this suit commenced, it had 662 partners working in 90 offices across the country. Price Waterhouse is managed by a Senior Partner and Policy Board elected by all the partners. New partners are regularly drawn from the ranks of the firm's senior managers through a formal nomination and review process that culminates in a partnership-wide vote. There are no formal limits on the number of persons who may be made partners in any one year. Hopkins v. Price Waterhouse, 618 F.Supp. 1109, 1111 (D.D.C.1985).

    Plaintiff joined Price Waterhouse as a manager in August 1978 and began working in its Office of Government Services (OGS) in Washington, D.C. She specialized in preparing, securing, and managing contracts for large-scale computer-based systems designed specifically for government agencies. Plaintiff had previously worked at Touche Ross, another large accounting firm where her husband was also employed, but left because that firm's rules prohibited both husband and wife from being considered for partnership. Shortly after her departure, plaintiff's husband became a partner at Touche Ross. In order to hire her, Price Waterhouse waived one of its own rules that barred employment of anyone whose spouse was a partner in a competing firm. In 1981, however, the firm advised plaintiff that, because of her

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    husband's position at Touche Ross, she would not be eligible for partnership at Price Waterhouse. She threatened to resign and the matter was resolved only because Hopkins' husband left Touche Ross to set up his own consulting firm. Plaintiff was nominated for partnership a year later, in August 1982.

    There is no dispute that Hopkins was qualified for partnership consideration. She was exceptionally successful in garnering business for the firm, winning contract awards with the Department of State and the Farmers Home Administration worth an estimated $34 to $44 million to Price Waterhouse. The firm's Senior Partner, Joseph Connor, characterized one of these contracts--a world-wide computerized system capable of handling all State Department financial transactions--as a "leading credential" that enabled the firm to win similar business from other federal agencies. The District Court expressly found that none of the other candidates considered for partnership in 1983 had generated more business for Price Waterhouse than plaintiff. 618 F.Supp. at 1112. In addition, she billed more hours than any of the other candidates under consideration.

    The partners in OGS formally initiated the admission process for plaintiff by nominating her for partnership in August 1982. In support of her candidacy OGS submitted a flattering appraisal of her work, highlighting her "outstanding performance" in connection with the State Department project, and strongly urging her admission to the partnership. The appraisal stated in part:

    In her five years with the firm, she has demonstrated conclusively that she has the capacity and capability to contribute significantly to the growth and profitability of the firm. Her strong character, independence and integrity are well recognized by her clients and peers. Ms. Hopkins has outstanding oral and written communication skills. She has a good business sense, and ability to grasp and handle quickly the most complex issues, and strong leadership qualities.

    Plaintiff's Exhibit ("Pl.Ex.") 15.

    After a local office such as OGS nominates one of its senior managers for partnership, Price Waterhouse circulates the nominee's name and the accompanying appraisal of his or her work to all partners, who are invited to comment on the candidate. Those partners who have worked closely or extensively with a candidate submit "long-form" evaluations, while those whose contact has been more limited submit "short-forms." Partners are asked to rank individual nominees against all other candidates in 48 categories; to indicate whether the individual should be admitted, rejected, or placed on hold; and to provide written comments explaining their recommendations. The Admissions Committee, an arm of the firm's Policy Board, reviews each candidate's personnel file and occasionally interviews individual partners who have commented on a given candidate. The Committee then prepares a summary of the evaluations and makes its own recommendations to the Policy Board, providing a short written statement explaining any recommendation to hold or reject a candidate. The Policy Board in turn votes on whether the candidate should be included on the partnership ballot, held for reconsideration, or rejected. The Board can override the recommendations of the Admissions Committee and evaluates candidates not only on the basis of their individual merit, but also in terms of the firm's business needs. Those candidates who receive the Board's approval are placed on the ballot for a partnership-wide election; those who are not included are informed of the Board's reasons for rejecting or postponing their candidacies.

    Plaintiff was the only woman among the 88 candidates nominated for partnership in August 1982. Of these, 47 were invited to join the partnership, 21 were rejected outright, and the remaining 20--including plaintiff--were placed on hold. Seventeen of the 19 men placed on hold were renominated the following year (the other two had been placed on two-year holds), and of these, 15 were ultimately admitted. OGS, however, did not renominate plaintiff. Of the thirty-two partners who submitted evaluations and comments on her candidacy,

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    fully a fourth opposed her admission; another three partners recommended that she be held for reconsideration; and eight others stated that they lacked a sufficient basis upon which to form an opinion. 618 F.Supp. at 1113. Many of the comments from evaluating partners centered on Hopkins' apparent difficulties with staff, and both supporters and opponents of her candidacy characterized her as sometimes overly aggressive, unduly harsh, impatient with staff, and very demanding.

    A number of these complaints about plaintiff's lack of "interpersonal skills" were couched in terms of her sex. One critic suggested that Hopkins needed to take a "course at charm school." Pl.Ex. 21. A supporter sought to excuse her behavior by speculating that "she may have overcompensated for being a woman." Defendant's Exhibit ("Def.Ex.") 31. A member of the Admissions Committee investigated a reference in Hopkins' personnel file about her use of profanity and testified that "several ... partners" regarded her language as "one of the negatives." Transcript of Trial ("Tr.") 321. One supporter felt compelled to defend her on this subject, arguing that "[m]any male partners are worse than Ann (language and tough personality)"...

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