E.E.O.C. v. D.H. Holmes Co., Ltd., 76-4184

• Decision Date: 29 July 1977
• Docket Number: No. 76-4184,76-4184
• Citation: 556 F.2d 787
• Parties: 15 Fair Empl.Prac.Cas. 378, 14 Empl. Prac. Dec. P 7768 EQUAL EMPLOYMENT OPPORTUNITY COMMISSION, Plaintiff-Appellant, v. D. H. HOLMES CO., LTD., Defendant-Appellee.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 787

556 F.2d 787

15 Fair Empl.Prac.Cas. 378, 14 Empl. Prac.

Dec. P 7768

EQUAL EMPLOYMENT OPPORTUNITY COMMISSION, Plaintiff-Appellant, v. D. H. HOLMES CO., LTD., Defendant-Appellee.

No. 76-4184.

United States Court of Appeals Fifth Circuit.

July 29, 1977.

William H. Ng., E.E.O.C., Washington, D. C., Abner W. Sibal, Gen. Counsel, Joseph T. Eddins, Jr., Assoc. Gen. Counsel, Beatrice Rosenberg, Asst. Agency Counsel, E.E.O.C., Washington, D. C., for plaintiff-appellant.

David L. McComb, G. Phillip Shuler, III, New Orleans, La., for defendant-appellee.

Douglas S. McDowell, Robert E. Williams, Avrum M. Goldberg, William R. Weissman, Washington, D. C., amicus curiae, for Equal Employment Advisory Council.

Appeal from the United States District Court for the Eastern District of Louisiana.

Before COLEMAN, Circuit Judge, KUNZIG, Judge, ^* and GEE, Circuit Judge.

KUNZIG, Judge:

This case of first impression (at the appellate level) comes to us on an interlocutory appeal from an order of the United States District Court for the Eastern District of Louisiana. The two questions presented on appeal are: Did the district court properly characterize this particular suit as a class action and, if so, did it correctly determine that the Equal Employment Opportunity Commission (EEOC) is governed by Fed.R.Civ.P. 23 ¹ just as any normal plaintiff? We answer both questions in the affirmative and, therefore, uphold the order of the district court and remand the case for further proceedings.

The underlying dispute concerns instances of alleged sex discrimination in employment. The D. H. Holmes Company, Ltd. (Holmes, defendant-appellee), a Louisiana corporation which operates nine retail stores and employs approximately 3500 persons, is alleged to have violated certain provisions of Title VII of the Civil Rights Act of 1964 as amended, 42 U.S.C. § 2000e et seq. (1970 & Supp. V 1975). The Equal Employment Opportunity Commission (EEOC, plaintiff-appellant) instituted suit under the authority of the Civil Rights Act, § 706(f)(1), 42 U.S.C. § 2000e-5(f)(1) (Supp. V 1975) ² and seeks an injunction prohibiting alleged sex discrimination, an order compelling affirmative action programs, and an award of back pay to "those persons adversely affected."

There has, of course, been no finding of facts by the court below and we make no intimation here concerning the truth of the matters asserted. But, drawing upon the already voluminous record made pursuant to pre-trial discovery, and, for the purposes of this appeal, construing those documents most favorably to the plaintiff (EEOC), the alleged facts may be stated as follows:

Holmes operates nine stores, is divided into 494 departments, and employs about 3500 workers. In October 1973, a series of incidents occurred which involved employees of the security department (store detectives) at the Lakeside store. Joseph Tardo, Lakeside store ³ security manager, was transferred to the Oakwood store and replaced at Lakeside by a new security supervisor. On October 15, 1973, his first duty day in his new position, the new Lakeside supervisor allegedly grabbed the arm of Maria Marino, a store detective with some years experience and a subordinate of his. In a second incident, on October 16, 1973, the new supervisor allegedly rubbed his body against Mrs. Marino. Sharon Neidhardt, also a store detective at Lakeside, allegedly witnessed the October 16 incident and was herself a subject of alleged sexual advances by the same supervisor who was said to have drawn her attention to the zipper of his trousers on or about October 22. The two women brought these matters to the attention of upper management. Following an informal investigation, after which the charges were found to be groundless, the Holmes Company discharged the two women.

Mrs. Marino subsequently filed a complaint with the EEOC. She alleged first that the job of Lakeside store security manager should have gone to her on October 15, upon Mr. Tardo's departure, but that the position was denied her because of her sex. She further alleged that she was fired for having reported to upper management that the new security manager had made improper sexual advances to her.

Sharon Neidhardt also filed a complaint with the EEOC. She alleged that she was discharged for having reported that the new security manager had exposed himself to her. She requested and obtained a "right to sue" ⁴ letter from the EEOC, retained counsel, and instituted suit against Holmes. Neidhardt v. Holmes Co., Ltd., No. 72-2395 (E.D.La.) (subsequently consolidated with EEOC v. Holmes (Order of the court, dated Jan. 12, 1976), hereinafter referred to as EEOC v. Holmes Co., Ltd.

Three other charges have been filed with EEOC. In November 1973, Pamela Clark, a display artist, filed a charge with EEOC that she had been fired because of her sex. In January 1974, Beverly Saxon, a security department employee at the Canal Street store filed a charge with EEOC alleging that she was being denied promotion because of her sex. Finally, in March 1974, Joseph Tardo, the former security department supervisor at Lakeside whose transfer in October 1973 set in motion the subsequent events of that month and who had just been discharged, filed a complaint with EEOC alleging that his discharge was a result of his having refused to cooperate with Holmes in its defense of Mrs. Marino's charges during the EEOC investigation.

In September 1975, EEOC itself instituted court action against Holmes. It filed an initial complaint against practices at the Lakeside store and later amended the complaint to include all the other stores. The amended complaint, filed in district court in March 1976, is drawn in general terms. It broadly alleges violations of §§ 703 and 704 of Title VII, 42 U.S.C. §§ 2000e-2 and 2000e-3 (1970 & Supp. V 1975) commencing on July 2, 1965, and continuing thereafter. It seeks monetary and injunctive relief on behalf of "all those affected" but does not further identify this class in the complaint. In the course of discovery (which has been ongoing since October 1975), including depositions, interrogatories, and answers to interrogatories, it seems increasingly clear that EEOC is not limiting itself to securing relief only on behalf of the five parties (Marino, Neidhardt, Clark, Saxon and Tardo) who had filed complaints, but rather EEOC is seeking relief for a broad class of persons.

Though not styled as a class action, the complaint, together with the subsequent course of discovery, created apprehension on the part of defendant. Holmes was concerned that it was in fact about to become the defendant in a class action law suit without being afforded the procedural protections and judicial controls embodied in Fed.R.Civ.P. 23. On June 25, 1976, Holmes moved to dismiss the class action aspect of the complaint.

District Court Judge Charles Schwartz, Jr. held that EEOC had "intended to bring this suit in the form of a class action." The court below further held that EEOC must comply with Fed.R.Civ.P. 23 and local rule 2.12, ⁵ giving EEOC 90 days in which to do so. The court stayed the proceedings until further order while denying Holmes' motion to dismiss the class action aspect at this stage. EEOC v. Holmes Co., Ltd., 13 FEP Cases 449 (E.D.La.1976). One requirement of Rule 23 is certification under 23(c); at the certification stage, EEOC must carry the burden of proof as to maintaining the class action aspect of this suit. 3B Moore's Federal Practice P 23.02-2 n. 33 (2d ed. 1977). Of course, whether this suit will be certified as a class action remains to be seen.

Rather than comply with the lower court order, EEOC sought immediate interlocutory review here pursuant to 28 U.S.C. § 1292(b). ⁶ The trial judge certified a controlling and unsettled ⁷ question of law to us, and we granted leave to appeal.

EEOC's position is that it need not follow Rule 23 and that, in any event, it cannot do so. EEOC contends that this cannot be a "Rule 23 class action" since it (EEOC) is not itself a member of the class. EEOC argues that Rule 23 on its face requires the party bringing a class action to be a member of the class which he purportedly represents. Further, EEOC argues, this cannot be a Rule 23 class action because the Commission seeks to vindicate a public as opposed to a private interest and so does not adequately represent the private members of the class as required by 23(a)(4). EEOC would still have this suit a class action, but it would be a statutory class action based on Title VII and not subject to Federal Rule 23.

Holmes, in opposition, asserts that this law suit, seeking broad injunctive and monetary relief on behalf of a class of persons, is a class action. That being so, Holmes urges that the chief issue is whether a class action filed by EEOC pursuant to § 706(f)(1) of Title VII of the Civil Rights Act of 1964 as amended is governed by Rule 23. Holmes maintains that there is no basis in law or reason to exempt EEOC from Federal Rule 23.

We agree with Holmes and with the court below. EEOC intended to bring this suit in the form of a class action and, at this stage of the proceedings, it is a class action. When EEOC brings a class suit under § 706(f)(1), 42 U.S.C. § 2000e-5(f)(1) it too must abide by appropriate Federal Rules of Civil Procedure, including Rule 23. We note at the outset that we are not here concerned with the merits of the case. Five parties have made charges against the Holmes Company that may merit relief; we are confident that the trial court will afford them a full and fair trial on those issues. The questions here before us on this interlocutory appeal are, therefore, very narrow ones which concern merely the procedural side of this case. ⁸

The initial issue is whether this is a class action. We conclude that it is.

The trial court, in ruling that EEOC intended to bring a class action, found the law suit to be a class action (at least at...