Chastang v. Flynn and Emrich Company

• Decision Date: 26 October 1973
• Docket Number: 71-652-M.,Civ. A. No. 71-593-M
• Citation: 365 F. Supp. 957
• Parties: Vincent R. CHASTANG v. FLYNN AND EMRICH COMPANY et al. Frank UGIANSKY v. FLYNN AND EMRICH COMPANY et al.
• Court: U.S. District Court — District of Maryland

365 F. Supp. 957

Vincent R. CHASTANG v. FLYNN AND EMRICH COMPANY et al.

Frank UGIANSKY v. FLYNN AND EMRICH COMPANY et al.

Civ. A. Nos. 71-593-M, 71-652-M.

United States District Court, D. Maryland.

August 14, 1973.

As Amended September 5, 1973.

Memorandum and Order October 26, 1973.

COPYRIGHT MATERIAL OMITTED

Harry Goldman, Jr., Baltimore, Md., for plaintiffs.

Paul L. Cordish and David S. Cordish, Baltimore, Md., for defendants.

JAMES R. MILLER, Jr., District Judge.

These companion cases, which were consolidated for trial, are premised upon an alleged violation of Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq., with respect to the non-contributory retirement plan¹ of Flynn and Emirch Company (hereinafter referred to as F&E). The "liability" portion of a bifurcated trial has now been completed. Plaintiffs are two retired male employees of F&E who claim that the plan discriminated against them on the basis of sex because female employees were entitled to retire earlier and receive greater retirement benefits than male employees similarly situated.

Vincent Chastang was hired by F&E in February, 1937, and retired effective July 25, 1968, at the age of 52. Frank Ugiansky was hired by F&E in January, 1951, and retired effective March 24, 1969, at the age of 42.² Upon retiring, Chastang received $27,779.56 from the retirement fund while Ugiansky received $12,404.14. In each case this amount represented only about 50% of plaintiffs' accrued retirement benefits under the plan.

Both plaintiffs, after receiving "right to sue letters" from the Equal Employment Opportunity Commission (EEOC), brought suit in this court alleging that defendant had discriminated against them on the basis of sex in paying them only 50% of their vested interests in the retirement plan. Defendants are F&E which is engaged in the foundry business, The Equitable Trust Company which acts as trustee for the plan, and the five members of the F&E Profit Sharing Trust Committee and their successors who administer the plan.

Under the provisions of the plan,³ the retirement age for men was 65 and for women, 60. The plan permitted early retirement at the option of the company for employees of both sexes. However, benefits for females under the plan vested at twice the rate as for males such that females who retired early and had worked for the Company for 11 years could receive 100% of their accrued benefits, while males of the same status could receive only 50% of their accrued benefits. Only if a male employee alternatively worked until age 65, died, became totally disabled, voluntarily or involuntarily went on an hourly wage scale, or had his employment terminated as the result of a sale of a portion of the company's operating assets, could he receive all of his accrued benefits under the plan. Otherwise, if a male retired early after 11 years' service, 50% of his accrued retirement benefits would be deemed to be forfeited under the plan.

Jurisdiction

In an earlier proceeding in this case the issue was raised as to whether plaintiffs had complied with the filing prerequisites of Title VII. Specifically, defendants maintained that 42 U.S.C. § 2000e-5 had not been satisfied because plaintiffs had not refiled their charges with the EEOC after the charges had been referred by the EEOC to the Maryland Human Relations Commission. This court ruled at that time that, under the Supreme Court's decision in Love v. Pullman, 404 U.S. 522, 92 S.Ct. 616, 30 L.Ed.2d 679 (1972), plaintiffs were not required to refile their complaints with the EEOC subsequent to waiver by, or inaction of, the Human Relations Commission.⁴

Defendant Trust Committee members, via a motion for a directed verdict at the close of plaintiffs' case, raised another procedural question upon which the court reserved ruling and which now must be considered before reaching the merits of the cases. These defendants maintain that the court lacks jurisdiction over them (and therefore the trust itself) because the Trust Committee members, although parties in this case, were not made parties to the EEOC proceedings. These defendants therefore contend that plaintiffs have failed to comply with 42 U.S.C. §§ 2000e-5(a) and (e), now 42 U.S.C. § 2000e-5(b) and (f)(1).⁵

The members of the Trust Committee named in the complaints are Charles T. Turner, James F. Turner, Jr., James F. Turner, III, Stuart Olivier, Louis B. Weller, and their successors. The actual trustee at all relevant times was The Equitable Trust Company which was a party in the EEOC proceedings as well as in the present cases.

Plaintiffs contend that the principles of Trust Law mandate that one seeking to obtain money from the corpus of a trust sue the trustee and that they have done so both here and before the EEOC. In addition, they assert that the members of the Trust Committee are all officers and/or directors of F&E. Thus, plaintiffs argue that the conciliation policy of Title VII was satisfied because the EEOC had an opportunity to attempt to obtain voluntary compliance from the persons at F&E who were in a position to take remedial action either as officers or directors or as members of the Trust Committee. Defendants deny that the evidence at trial established a substantial identity between the directors of F&E and the members of the Trust Committee. They also rely upon Mickel v. South Carolina State Employment Service, 377 F.2d 239 (4th Cir. 1967), cert. denied, 389 U.S. 877, 88 S. Ct. 177, 19 L.Ed.2d 166 (1967), for the proposition that a person or entity who was not the subject of a complaint made to the EEOC cannot later be made a party to a civil suit arising out of that complaint.

The Trust Agreement itself as well as other evidence indicates that The Equitable Trust Compnay was little more than a nominal trustee. Its duties were limited generally to bookkeeping and investment recommendations while the Trust Committee actually administered the trust in the legal sense of the term, "trustee."⁶ It is unnecessary, however, to consider whether the proper party was before the EEOC in terms of Trust Law. The evidence at trial was sufficient in the court's view to satisfy the procedural requirements of 42 U.S.C. §§ 2000e-5(b) and (f)(1).

The policy of Title VII in general and 42 U.S.C. § 2000e-5(b) and (f)(1) in particular is to provide an employer or labor organization charged with discrimination with notice of the charge and to provide a forum for informal negotiations and conciliation efforts between the EEOC and the charged party before the controversy progresses to an adversary proceeding. Johnson v. Seaboard Air Line Railroad Co., 405 F. 2d 645, 651 (4th Cir. 1968), cert. denied sub nom., Pilot Freight Carriers, Inc. v. Walker, 394 U.S. 918, 89 S.Ct. 1189, 22 L.Ed.2d 451 (1969); Bowe v. Colgate-Palmolive Co., 416 F.2d 711, 720 (7th Cir. 1969). An actual attempt by the EEOC to eliminate an unlawful employment practice by means of voluntary compliance, however, is not a jurisdictional prerequisite to the institution of a civil suit. The policy of the Act is satisfied as long as the EEOC is given the opportunity to mediate an unlawful employment practice with a view toward obtaining voluntary compliance. Stebbins v. Nationwide Mutual Ins. Co., 382 F.2d 267, 268 (4th Cir. 1967), cert. denied, 390 U.S. 910, 88 S.Ct. 836, 19 L. Ed.2d 880 (1968); Johnson v. Seaboard Air Line Railroad Co., supra.

Clearly, if a party to a civil suit was not a party before the EEOC, there was not even an opportunity for the Commission to attempt to obtain voluntary compliance from that particular party, thus frustrating the policy of the Act. This is the thrust of the Fourth Circuit's decision in Mickel v. South Carolina State Employment Service, supra. The facts of that case, however, are easily distinguishable from those involved here.

In Mickel the plaintiff sued the South Carolina State Employment Service and the Exide Battery Company after having charged only the former before the EEOC. Plaintiff claimed racial discrimination in her attempt to secure employment with Exide through the Employment Service even though she was never referred to Exide by the Employment Service, never directly contacted Exide, and never had any direct dealings with Exide. Plaintiff's sole theory for upholding jurisdiction as to Exide was that the Employment Service was Exide's agent for purposes of referring persons to Exide for employment by virtue of the fact that Exide had registered with the Employment Service as a prospective employer. The Fourth Circuit found this contention "utterly lacking in merit" stating that there was no indication that the Employment Service acted as Exide's agent to implement an Exide purpose of invideous discrimination. As the court observed, "Exide was not `named in the charge' filed with the Commission, and the Commission was not required to enter into any conciliatory negotiations with Exide." 377 F.2d at 242. Exide was thus a completely separate entity having no relevant connection to the party charged before the EEOC. That is not the situation here.

According to the Commission decisions⁷ in these cases, F&E was served with Vincent Chastang's charge to the EEOC on March 13, 1969,⁸ and with Frank Ugiansky's charge on June 30, 1970.⁹ In both cases this occurred after the charges had been referred to the Maryland Human Relations Commission and the EEOC had resumed jurisdiction. A "right to sue letter" was issued to Chastang on or about May 11, 1971, and to Ugiansky, on or about June 8, 1971. This factual sequence demonstrates that any attempt to obtain voluntary compliance in these cases by the EEOC would have had to occur between March, 1969 and June, 1971. During this time period, Charles T. Turner, James F. Turner, Jr., and James F. Turner, III, were all officers and/or directors of F&E.¹⁰ These same three individuals were also members of the five-man Trust Committee¹¹ during this period as...