Carson v. American Brands, Inc.

• Decision Date: 14 September 1979
• Docket Number: No. 77-2260,77-2260
• Citation: 606 F.2d 420
• Parties: 20 Fair Empl.Prac.Cas. 1186, 20 Empl. Prac. Dec. P 30,270 Frank L. CARSON, Lawrence Hatcher, Stuart E. Mines, Appellants, v. AMERICAN BRANDS, INC., t/a The American Tobacco Company; Local 182, TobaccoWorkers International, Tobacco Workers International Union, Appellees.
• Court: U.S. Court of Appeals — Fourth Circuit

Page 420

606 F.2d 420

20 Fair Empl.Prac.Cas. 1186,

20 Empl. Prac. Dec. P 30,270

Frank L. CARSON, Lawrence Hatcher, Stuart E. Mines, Appellants, v. AMERICAN BRANDS, INC., t/a The American Tobacco Company;

Local 182, TobaccoWorkers International, Tobacco

Workers International Union, Appellees.

No. 77-2260.

United States Court of Appeals, Fourth Circuit.

Submitted En Banc June 5, 1979.

Decided Sept. 14, 1979.

John W. Scott, Jr., Fredericksburg, Va., Henry L. Marsh, III, William H. Bass, III, Randall G. Johnson, Hill, Tucker & Marsh, Richmond, Va., for appellants; Jack Greenberg, New York City, Barry L. Goldstein, Washington, D. C., on brief.

D. Eugene Webb, Jr., Henry T. Wickham, Mays, Valentime, Davenport & Moore, Richmond, Va., on brief for American Brands, Inc., t/a The American Tobacco Company.

Jay J. Levit, Stallard & Levit, Richmond, Va., James F. Carroll, New York City, on brief for Local 182, Tobacco Workers International Union, Tobacco Workers International Union.

Before HAYNSWORTH, Chief Judge and WINTER, BUTZNER, RUSSELL, WIDENER, HALL and PHILLIPS, Circuit Judges.

K. K. HALL, Circuit Judge:

Plaintiffs seek an interlocutory appeal under 28 U.S.C. § 1292(a)(1) of the district court's refusal to enter a consent decree agreed to by the named parties in a Title VII class action.

The suit is based on claims of race discrimination and is brought against employer and union on behalf of black workers and black applicants for employment at an American Tobacco Company plant in Richmond, Virginia. The decree would grant money damages and hiring and seniority preferences to black employees and would set a goal requiring the employer to give preference to blacks in hiring for supervisory positions until a certain number of qualified blacks were employed. The decree was negotiated by representative plaintiffs, and it provides for notice to all class members.

The named plaintiffs contend that this relief is injunctive in nature, and, because the district court refused to enter the decree, its order is immediately appealable under § 1292(a)(1) as a denial of injunctive relief. We disagree.

The district court's order refusing entry of the decree does not deny any relief, whatever its nature. It merely requires the parties to either revise the decree or proceed with the case by trial or motions for summary judgment. The immediate consequence of the order is continuation of the litigation and, because the merits of the decree can be reviewed following final judgment, we think it is not an appealable order under § 1292(a)(1). Accordingly, we dismiss the appeal.

I.

In Flinn v. FMC Corporation, 528 F.2d 1169 (4th Cir. 1975), Cert. denied, 424 U.S. 967, 96 S.Ct. 1462, 47 L.Ed.2d 734 (1976), we heard the appeal of individual class plaintiffs alleging that the district court abused its discretion by entry of a consent decree in a Title VII sex discrimination class action. There, the overwhelming majority of class members had voted to adopt the decree, and the district court entered it on the "eve of trial." With scholarly care, Judge Russell surveyed various interests supporting entry of the decree and posited the rule that, when a district court is presented with a consent decree, it should view the merits of the decree in light favorable to its entry. That is, it should, without requiring technical perfection or legal certitude, determine whether the law and the facts of record Arguably support its terms. Under this standard, he identified factors which the district court should consider in exercising its discretion. These included "the extent of discovery that has taken place, the stage of the proceedings, the want of collusion in the settlement, and the experience of counsel who may have represented plaintiffs in the negotiation." Id. at 1173.

Plaintiffs argue that the district court erred in failing to consider the proposed decree under the liberal standards of Flinn ¹ and that its refusal to enter the decree is immediately appealable. Although we think the district court should have reviewed the proposed decree under Flinn, we do not think its refusal to approve the decree is a matter properly within our jurisdiction prior to final judgment.

In Flinn, the district court's Entry of the decree terminated the action, whereas here the district court's order refusing it has no such effect it continues the proceedings, making our review of it an interlocutory appeal.

II.

As a general rule appeals of right from interlocutory trial court decisions are not favored. 28 U.S.C. § 1291. Baltimore Contractors, Inc. v. Bodinger, 348 U.S. 176, 75 S.Ct. 249, 99 L.Ed. 233 (1955); Coopers & Lybrand v. Livesay, 437 U.S. 463, 98 S.Ct. 2454, 2459, 57 L.Ed.2d 351 (1978); Gardner v. Westinghouse Broadcasting Co., 437 U.S. 478, 98 S.Ct. 2451, 2453, 57 L.Ed.2d 364 (1978). They disrupt the trial process, slow the course of litigation and create unnecessary multiple appeals. A single appeal following final judgment facilitates orderly litigation and comprehensive appellate review of all issues presented, many of which are dependent upon or related to other issues in the suit. After final judgment, the fact issues have been settled in the appropriate forum, and appellate review can be dispositive of all issues in the case. See, Coopers & Lybrand v. Livesay, 98 S.Ct. at 2460-61.

In the interests of justice, appeals of right from interlocutory orders are allowed when the delay in hearing an appeal after final judgment poses some irreparable consequence, Gardner v. Westinghouse Broadcasting Co., 98 S.Ct. at 2453, or when the issue to be determined is sufficiently collateral to the ongoing litigation that no disruption of the trial process will attend early appellate review, See Cohen v. Beneficial Industrial Loan Corp., 337 U.S. 541, 546-47, 69 S.Ct. 1221, 93 L.Ed. 1528 (1949); Coopers & Lybrand v. Livesay, 98 S.Ct. at 2459.

Special statutory exceptions to the final judgment rule are set forth in 28 U.S.C. § 1292(a). Plaintiffs argue that characterization of the refused relief as "injunctive" is sufficient to meet the plain terms of § 1292(a)(1), which reads in pertinent part,

The courts of appeals shall have jurisdiction of appeals from: (1) Interlocutory orders of the (district courts) granting, continuing, modifying, refusing or dissolving injunctions, or refusing to dissolve or modify injunctions . . . .

But a mere labeling of relief is not sufficient. See City of Morgantown, W. Va. v. Royal Ins. Co., 337 U.S. 254, 258, 69 S.Ct. 1067, 93 L.Ed. 1347 (1949). Courts look to the consequence of postponing appellate review following final judgment and weigh the need for immediate appeal against the important judicial interests militating against piecemeal review. See Gardner v. Westinghouse Broadcasting Co., 98 S.Ct. at 2454; Coopers & Lybrand v. Livesay, 98 S.Ct. at 2460. This test is applied to appeals in class actions as well as to those in ordinary litigation. ² Under this test, we find no appeal of right from orders refusing consent decrees at any time before final judgment.

III.

The consequence of the district court's order is not irreparable. No right is forfeited as a result of delayed review. Here, injunctive relief was not finally denied; it was merely not granted at this stage in the proceedings. See Liberty Mutual Insurance Company v. Wetzel, 424 U.S. 737, 744-45, 96 S.Ct. 1202, 47 L.Ed.2d 435 (1976). Like the denial of a motion for summary judgment which, if granted, would include injunctive relief, the denial of this consent decree decided "only one thing that the case should go to trial." Switzerland Cheese Association, Inc. v. E. Horne's Market, Inc., 385 U.S. 23, 25, 87 S.Ct. 193, 195, 17 L.Ed.2d 23 (1966).

In Gardner v. Westinghouse Broadcasting Co., 437 U.S. 478, 98 S.Ct. 2451, 57 L.Ed.2d 364 (1978), the Supreme Court held that the pretrial denial of class certification in a Title VII case was not appealable under § 1292(a)(1) as a denial of injunctive relief. In that case, which involved allegations of sex-based discrimination, the complainant sought broad injunctive relief for the class similar to the relief proposed in the decree before us. The Court reasoned that the pretrial order denying class certification was not one of irreparable consequence since it could be reviewed at any stage of the proceedings either before or after final judgment, did not affect the complainant's personal claim for injunctive relief, and did not pass on the legal sufficiency of any claim for injunctive relief. Id. 98 S.Ct. at 2453-54 and notes 7, 8 and 9 (citing Switzerland Cheese ).

IV.

The analogous consequences of a district court's disapproval of a settlement in a class action and its refusal to grant summary judgment were considered by the Second Circuit in Seigal v. Merrick, 590 F.2d 35 (2nd Cir. 1978). The issue there was whether, in a stockholder derivative action, the court's order refusing settlement was appealable before final judgment.

Relying upon the analysis in Coopers & Lybrand v. Livesay, 437 U.S. 463, 98 S.Ct. 2454, 57 L.Ed.2d 351 (1978), a case decided the same day as Gardner, the Seigal court discussed the judicial and private interests always present where the rights of represented and unrepresented individuals may be compromised by the court's approval of a settlement. The court explained the purpose of requiring class action settlements to be presented to district courts under Fed.R.Civ.Proc. 23.1.

(A)n order disapproving a settlement . . . is based, in part, upon an assessment of the merit of the positions of the respective parties, and permits the parties to proceed with the litigation or to propose a different settlement.

A settlement in an ordinary civil litigation is normally the sole concern of the parties. In stockholder derivative actions, on the other hand, because of the vicarious representation involved, the court has a duty to perform before an action can be "settled." . . . This...