Capaci v. Katz & Besthoff, Inc.
| Decision Date | 15 October 1981 |
| Docket Number | Civ. A. No. 74-2743. |
| Citation | 525 F. Supp. 317 |
| Parties | Andra A. CAPACI, Plaintiff, and Equal Employment Opportunity Commission, Plaintiff-Intervenor, v. KATZ & BESTHOFF, INC., Defendant. |
| Court | U.S. District Court — Eastern District of Louisiana |
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Carl J. Schumacher, Jr., New Orleans, La., Dona S. Kahn, Philadelphia, Pa., for plaintiff.
James E. Miller, Cassandra M. Menoken, and Ethel M. Mixon, for plaintiff-intervenor.
Daniel Lund, James B. Irwin, New Orleans, La., for defendant.
The plaintiff Andra Capaci filed this employment discrimination suit on October 8, 1974, alleging that the defendant Katz & Besthoff, Inc., K&B had discriminated against her by (1) refusing to promote her to a managerial position while it continually promoted less qualified male employees; (2) subjecting her to disparate terms and conditions of employment; (3) retaliating against her after she filed a charge with the Equal Employment Opportunity Commission EEOC through harassment and denial to her of a standard wage increase accorded to most other employees, and, finally, discharging her from her employment.
The court has jurisdiction of this sex discrimination case under Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq.
The EEOC which had determined as a result of the charges filed with it by the plaintiff in January, May and August 1973 that K&B had in fact discriminated against her, both by refusing to promote her and by retaliating against her for filing a charge, was permitted to intervene in the suit on July 19, 1977. Upon motion of the defendant the previously certified class was decertified on the condition that the EEOC would be permitted to prosecute the claims of the class. The EEOC took an active role in the trial of the case to prove that K&B had a policy and practice of discrimination against females by excluding them as a class from management positions. The trial of the case was limited to the liability issues.
The plaintiff Andra Capaci, a female registered pharmacist, has been an employee of K&B in the New Orleans, Louisiana metropolitan area since 1963.1 K&B is a Louisiana Corporation domiciled in the City of New Orleans which operates a chain of drug stores in Louisiana, Mississippi and Alabama. The company, including its predecessor Katz & Besthoff, Ltd., has grown from one store opened in New Orleans in 1905 to eighty stores in 1979. The K&B organization was relatively small until 1971 when a period of rapid expansion began.
In 1973, the year Capaci filed her charge, the work force of K&B was largely female, but its managerial force was predominately male.2 Until the time of her charge there existed basically two lines of progression to store-wide management positions at K&B. One line was from a manager trainee position to relief manager and progressively to assistant manager and manager. The other line prior to 1968 was from pharmacist to assistant manager to manager. The position of chief pharmacist was created in 1967 and thereafter this line was principally from pharmacist to chief pharmacist, and few pharmacists were promoted to store-wide management positions after that date. Capaci was never promoted to assistant manager or chief pharmacist during her 10-year period of employment with K&B.
The EEOC relies principally on its statistical evidence and the testimony of its expert Dr. Joseph L. Gastwirth to prove its allegation that K&B followed a policy and pattern of discrimination against females in its practice of excluding females from promotion to management positions after July 1965, the effective date of the Civil Rights Act of 1964. To buttress its statistical evidence it produced one present employee and four former employees who testified that their impression was that K&B did not treat males and females equally in appointments to management positions, and it presented evidence of advertising practices of K&B to show that it preferred males over females in its management positions. The EEOC also urges the court to draw an unfavorable inference from K&B's failure to keep certain personnel records since the filing of the charge of discrimination in this case, allegedly in violation of the requirements of Title VII, § 709(c), and 29 C.F.R. 1602.14.
The EEOC offered 79 statistical exhibits in three categories: (1) Referent Exhibits 1-26; (2) Manager Trainee Exhibits 1-17; and (3) Pharmacy Exhibits 1-36. The Referent Exhibits were for the most part presentations of data from the 1970 Census on the civilian labor force in Louisiana which Dr. Gastwirth considered relevant to the K&B managerial force. The Manager Trainee exhibits were directed to proof that K&B excluded females from the manager trainee position, and the Pharmacy Exhibits dealt with discrimination in the promotion of female pharmacists.
Dr. Gastwirth made a variety of comparisons of the K&B managerial positions in his statistical studies. He compared the proportion of males and females in K&B's managerial force at certain periods of time with the proportion of males and females in various segments of the civilian labor force in Louisiana in 1970. Theoretically in these comparisons he used the various labor force segments as labor force pools of potential applicants for managerial positions at K&B. For example, he tested the probability of observing 3 or fewer females out of 201 officials and managers, assuming they were selected like a random sample from various labor force manager groups in Louisiana, all of which had been weighted according to the number of stores in the various labor markets served by K&B, and the lower bound of that weighting was used for the testing.3 The manager groups used by Dr. Gastwirth for this test, designated by him as "Referents" and their respective fractions female are as follows:4
Referent Fraction Female
All Managers .1607
Retail Trade Managers .1701
Retail General Merchandise
Store Managers .2364
Department and Sales
Managers (Retail Trade) .2207
He found the probability of 3 or fewer females occurring by chance was less than one in a billion as to each group which is statistically significant at the accepted .01 level of significance.5
The only objective qualification for the position of manager trainee at K&B is a high school education. The highest annual salary for the period 1966-1973 was $7,488.00, or more when overtime was involved. The EEOC relies on three approaches in its statistical proof as to the manager trainee to prove that K&B discriminated against females in its hiring for the manager trainee position. First, it compared the proportion of males and females hired directly by K&B as manager trainees from July 1965 to January 1, 1973 with what it considered to be the relevant civilian labor force data for that position. Second, it compared the proportion of males and females hired as manager trainees during the years 1976 and 1977 with the proportion of males and females who applied for the position during those years. Third, it compared the distribution of males and females hired directly by K&B as manager trainees during the period July 1965 through December 1977.
K&B hired directly, as distinguished from promotion from within the organization, 265 males and 0 females between July 1965 and January 1, 1973. To test the probability of this proportion having occurred by chance, Dr. Gastwirth compared it with data for several groups of managers in the civilian labor force in Louisiana derived by weighting the labor market areas served by K&B according to the number of stores in them. Those groups of managers and the respective fractions female are as follows:6
Referent Fraction Female
Managers Earning Less Than
$7,000 (in 1969) .33877
Experienced Wholesale and
Retail Managers Earning
Less than $7,000 (in 1969) .2766
General Merchandise Retail
Store Managers .244
Department and Sales Managers
(Retail Trade) .2809
He was testing the probability that K&B would hire 265 males and 0 females into its manager trainee position between July 1965 and January 1, 1973, if persons hired for the position were selected like a random sample from each of the above groups. His test results showed that the probability that 0 females out of 265 hired would occur by chance as to each group was less than one in a billion.8
Applicant flow data for the manager trainee position was available only for the years 1976 and 1977. The data included both outside applicants and those applying from within K&B, and showed the number of hires and the number of applicants for each year and for each sex, and the totals for both years were calculated.
Males Females
Percent Percent
Applicants Hires Hired Applicants Hires Hired
1976 100 64 64.0 12 5 41.66
1977 296 84 29.38 82 10 12.20
Total 396 148 37.37 94 15 15.96
A chi-square test showed that the difference between the percentage of male applicants hired (37.37) compared to the percentage of female applicants hired (15.96) for the position of manager trainee during 1976 and 1977 is statistically significant. The probability of this difference occurring by chance is one in a thousand according to the test.
During the period July 1965-December 1977, 633 males were appointed as manager trainee, and 20 females were so appointed. 97.95 percent of the males were hired directly and 30 percent of the females were hired directly. The remaining percent for each sex...
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