Crown, Cork Seal Company, Inc v. Parker

• Citation: 76 L.Ed.2d 628,462 U.S. 345,103 S.Ct. 2392
• Decision Date: 13 June 1983
• Docket Number: No. 82-118,82-118
• Parties: CROWN, CORK & SEAL COMPANY, INC., Petitioner v. Theodore PARKER
• Court: United States Supreme Court

462 U.S. 345

103 S.Ct. 2392

76 L.Ed.2d 628

CROWN, CORK & SEAL COMPANY, INC., Petitioner

v Theodore PARKER.

No. 82-118.

Argued April 18, 1983.

Decided June 13, 1983.

Syllabus

Respondent, a Negro male, after being discharged by petitioner employer in 1977, filed a discrimination charge with the Equal Employment Opportunity Commission (EEOC), which, on November 9, 1978, upon finding no reasonable cause to believe the charge was true, sent respondent a Notice of Right to Sue pursuant to § 706(f) of Title VII of the Civil Rights Act of 1964. Previously, while respondent's charge was still pending before the EEOC, two other Negro males formerly employed by petitioner had filed a class action against petitioner in Federal District Court, alleging employment discrimination and purporting to represent a class of which respondent was a member. Subsequently, on September 4, 1980, the District Court denied the named plaintiffs' motion for class certification, and the action then proceeded as an individual action. Within 90 days thereafter but almost two years after receiving his Notice of Right to Sue, respondent filed an action under Title VII against petitioner in Federal District Court, alleging that his discharge was racially motivated. The District Court granted summary judgment for petitioner on the ground that respondent had failed to file his action within 90 days of receiving his Notice of Right to Sue as required by § 706(f)(1). The Court of Appeals reversed.

Held: The filing of the class action tolled the statute of limitations for respondent and other members of the putative class. Since respondent did not receive his Notice of Right to Sue until after the class action was filed, he retained a full 90 days in which to bring suit after class certification was denied, and hence his suit was timely filed. Pp. 349-354.

(a) While American Pipe & Constr. Co. v. Utah, 414 U.S. 538, 94 S.Ct. 756, 38 L.Ed.2d 713 concerned only intervenors in a class action, the holding of that case—that the filing of a class action tolls the running of the applicable statute of limitations for all asserted members of the class—is to be read as not being limited to intervenors but as extending to class members filing separate actions. Otherwise, class members would be led to file individual actions prior to denial of class certification, in order to preserve their rights. The result would be a needless multiplicity of actions—precisely the situation that Federal Rule of Civil Procedure 23 and the tolling rule of American Pipe were designed to avoid. Pp. 349-351.

(b) Failure to apply American Pipe to class members filing separate actions would also be inconsistent with this Court's reliance on American Pipe in Eisen v. Carlisle & Jacquelin, 417 U.S. 156, 94 S.Ct. 2140, 40 L.Ed.2d 73 , where it was held that Rule 23(c)(2) required individual notice to class members so that each of them could decide whether to "opt out" of the class and thereby preserve his right to pursue his own lawsuit. A class member would be unable to pursue his own lawsuit if the limitations period had expired while the class action was pending. Pp.351-352

(c) A tolling rule for class actions is not inconsistent with the purposes served by statutes of limitations of putting defendants on notice of adverse claims and of preventing plaintiffs from sleeping on their rights. These ends are met when a class action is filed. Class members who do not file suit while the class action is pending cannot be accused of sleeping on their rights. And a class complaint notifies the defendants not only of the claims against them but also of the number and generic identities of the potential plaintiffs. Pp. 352-353.

(d) Once the commencement of a class action suspends the applicable statute of limitations as to all putative members of the class, it remains suspended until class certification is denied. Pp.353-354

677 F.2d 391, 4th Cir.1982, affirmed.

George D. Solter, Baltimore, Md., for petitioner.

Norris C. Ramsey, Baltimore, Md., for respondent.

Justice BLACKMUN delivered the opinion of the Court.

The question that confronts us in this case is whether the filing of a class action tolls the applicable statute of limitations, and thus permits all members of the putative class to file individual actions in the event that class certification is denied, provided, of course, that those actions are instituted within the time that remains on the limitations period.

I

Respondent Theodore Parker, a Negro male, was discharged from his employment with petitioner Crown, Cork & Seal Company, Inc., in July 1977. In October of that year, he filed a charge with the Equal Employment Opportunity Commission (EEOC) alleging that he had been harassed and then discharged on account of his race. On November 9, 1978, the EEOC issued a Determination Letter finding no reasonable cause to believe respondent's discrimination charge was true, and, pursuant to § 706(f) of the Civil Rights Act of 1964 (Act), 78 Stat. 260, as amended, 42 U.S.C. § 2000e-5(f), sent respondent a Notice of Right to Sue. App. 5A, 7A.

Two months earlier, while respondent's charge was pending before the EEOC, two other Negro males formerly employed by petitioner filed a class action in the United States District Court for the District of Maryland. Pendleton v. Crown, Cork & Seal Co., Civ. No. M-78-1734. The complaint in that action alleged that petitioner had discriminated against its Negro employees with respect to hiring, discharges, job assignments, promotions, disciplinary actions, and other terms and conditions of employment, in violation of Title VII of the Act, 78 Stat. 253, as amended, 42 U.S.C. § 2000e et seq. The named plaintiffs purported to represent a class of "black persons who have been, continue to be and who in the future will be denied equal employment opportunities by defendant on the grounds of race or color." App. to Brief for Petitioner 2a. It is undisputed that respondent was a member of the asserted class.

In May 1979, the named plaintiffs in Pendleton moved for class certification. Nearly a year and a half later, on September 4, 1980, the District Court denied that motion. App. to Brief for Petitioner 7a. The court ruled that the named plaintiffs' claims were not typical of those of the class, that the named plaintiffs would not be adequate representatives, and that the class was not so numerous as to make joinder impracticable. Thereafter, Pendleton proceeded as an individual action on behalf of its named plaintiffs.¹

On October 27, 1980, within 90 days after the denial of class certification but almost two years after receiving his Notice of Right to Sue, respondent filed the present Title VII action in the United States District Court for the District of Maryland, alleging that his discharge was racially motivated. Respondent moved to consolidate his action with the pending Pendleton case, but petitioner opposed the motion on the ground that the two cases were at substantially different stages of preparation. The motion to consolidate was denied. The District Court then granted summary judgment for petitioner, ruling that respondent had failed to file his action within 90 days of receiving his Notice of Right to Sue, as required by the Act's § 706(f)(1), 42 U.S.C. § 2000e-5(f)(1). 514 F.Supp. 122 (D.C.1981).

The United States Court of Appeals for the Fourth Circuit reversed. 677 F.2d 391 (4th Cir.1982). Relying on American Pipe & Constr. Co. v. Utah, 414 U.S. 538, 94 S.Ct. 756, 38 L.Ed.2d 713 (1974), the Court of Appeals held that the filing of the Pendleton class action had tolled Title VII's statute of limitations for all members of the putative class. Because the Pendleton suit was instituted before respondent received his Notice, and because respondent had filed his action within 90 days after the denial of class certification, the Court of Appeals concluded that it was timely.

Two other Courts of Appeals have held that the tolling rule of American Pipe applies only to putative class members who seek to intervene after denial of class certification, and not to those who, like respondent, file individual actions.² We granted certiorari to resolve the conflict. --- U.S. ----, 103 S.Ct. 338, 74 L.Ed.2d 381 (1982).

II

A.

American Pipe was a federal antitrust suit brought by the State of Utah on behalf of itself and a class of other public bodies and agencies. The suit was filed with only 11 days left to run on the applicable statute of limitations. The District Court eventually ruled that the suit could not proceed as a class action, and eight days after this ruling a number of putative class members moved to intervene. This Court ruled that the motions to intervene were not time-barred. The Court reasoned that unless the filing of a class action tolled the statute of limitations, potential class members would be induced to file motions to intervene or to join in order to protect themselves against the possibility that certification would be denied. 414 U.S., at 553, 94 S.Ct., at 766. The principal purposes of the class action procedure—promotion of efficiency and economy of litigation—would thereby be frustrated. Ibid. To protect the policies behind the class action procedure, the Court held that "the commencement of a class action suspends the applicable statute of limitations as to all asserted members of the class who would have been parties had the suit been permitted to continue as a class action." Id., at 554, 94 S.Ct., at 766.

Petitioner asserts that the rule of American Pipe was limited to intervenors, and does not toll the statute of limitations for class members who file actions of their own.³ Petitioner relies on the Court's statement in American Pipe that "the commencement of the original class suit tolls the running of the statute for all purported members of the class who make timely motions to intervene after the court has found the suit inappropriate for class...