Frederick County Fruit Growers Ass'n Inc. v. Dole, Civ. A. No. 87-1588 (CRR).

• Decision Date: 01 March 1991
• Docket Number: Civ. A. No. 87-1588 (CRR).
• Parties: FREDERICK COUNTY FRUIT GROWERS ASSOCIATION INC., et al., Plaintiffs, v. Elizabeth DOLE, Secretary of Labor, et al., Defendants, and Cedrick Turner, et al., Defendants-Intervenors.
• Court: U.S. District Court — District of Columbia

758 F. Supp. 17

FREDERICK COUNTY FRUIT GROWERS ASSOCIATION INC., et al., Plaintiffs, v. Elizabeth DOLE, Secretary of Labor, et al., Defendants and Cedrick Turner, et al., Defendants-Intervenors.

Civ. A. No. 87-1588 (CRR).

United States District Court, District of Columbia.

March 1, 1991.

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Thomas E. Wilson, Christopher A. Weals and Mary Beth Sullivan of Seyfarth, Shaw, Fairweather & Geraldson, Washington, D.C., with W.A. Johnston of Harrison & Johnston, Winchester, Va., for plaintiffs.

Stuart M. Gerson, Asst. Atty. Gen., Jay B. Stephens, U.S. Atty., Judry L. Subar, Sandra M. Schraibman and Harry Sheinfeld, Washington, D.C., for defendants.

Shelley Davis of Migrant Legal Action Program, Washington, D.C., Edward J. Tuddenham of Richards, Wiseman & Durst, Austin, Tex., Garry G. Geffert of West Virginia Legal Services, Martinsburg, Va., and Gregory Schell of Florida Rural Legal Services, Lake Worth, Fla., for defendants-intervenors.

CHARLES R. RICHEY, District Judge.

The Court was under the impression that its comprehensive January 17, 1989 Opinion had finally laid the above-captioned case to rest by granting summary judgment for the Department of Labor ("DOL") and granting the defendant-intervenor Farm-workers' summary judgment motion as to the plaintiff Growers' back-wage liability for 1983 and 1985. See Frederick County Fruit Growers Ass'n v. McLaughlin, 703 F.Supp. 1021 (D.D.C.1989) hereinafter FCFGA. However, since then the Growers filed a motion for reconsideration in light of the Supreme Court's intervening decision in Martin v. Wilks, 490 U.S. 755, 109 S.Ct. 2180, 104 L.Ed.2d 835 (1989), and (after a remand by the Court of Appeals) the parties requested the Court's assistance in resolving certain issues affecting the calculation of the Growers' back-wage liability. In this omnibus Opinion, the Court will deny the Growers' motion for reconsideration, will resolve the issues involving the back wages that the Growers owe the Farmworkers for 1983 and 1985, and will decide some miscellaneous outstanding motions.

I. Impact of Martin v. Wilks

The Growers' motion for reconsideration must fail because this case differs from the Supreme Court's Martin decision in several significant ways. Although Martin involved a collateral attack on an earlier court order and the Growers brought this lawsuit to collaterally attack this Court's earlier rulings in a separate lawsuit by the Farmworkers challenging DOL's interpretation of 20 C.F.R. § 655.207(c), see NAACP, Jefferson County Branch v. Donovan, 558 F.Supp. 218 (D.D.C.1982) (NAACP I); NAACP, Jefferson County Branch v. Donovan, 566 F.Supp. 1202 (D.D.C.1983) (NAACP II), the similarities end there. First, Martin involved a collateral attack on a consent decree whereas here the Growers are trying to overturn a final court order granting declaratory and injunctive relief despite DOL's vigorous litigation efforts. Second, the Martin litigation, which addressed charges of Title VII employment discrimination made first by black firefighters and then by white firefighters against their employer, involved "private rights." By contrast, the litigation at issue here implicates "public rights" because it focuses upon whether a federal agency properly interpreted and applied its regulations affecting numerous individuals and entities throughout the country and whether that agency violated the Administrative Procedure Act ("APA") when complying with this Court's NAACP rulings.¹ Third, while the defendants in Martin justified their admittedly race conscious employment decisions as compelled by the earlier consent decree, see Martin, 490 U.S. at 759-60, 109 S.Ct. at 2183-84, here DOL does not use the Court's NAACP rulings to justify otherwise illegal action, arguing instead that an agency's compliance with a federal court order simply cannot be an APA violation.²

In any event, even if Martin were sufficiently on point to permit the Growers to collaterally attack the injunctive relief achieved by the Farmworkers against DOL in the NAACP litigation, Martin has nothing to do with the Court's back-wage rulings, which were based upon equitable restitution and contract law principles and are the rulings now contested by the Farmworkers.³ As the Court made clear in its January 17, 1989 Opinion, it granted summary judgment for DOL because the Growers were collaterally estopped from attacking the results of NAACP I and NAACP II, see FCFGA, 703 F.Supp. at 1028, but held that this conclusion "does not dispose of the Growers' actual wage obligations," id. The Court went on to hold that the Growers were liable for back wages for 1983 under an equitable restitution theory, see id. at 1028-29 (Growers paid average worker piece rate in reliance on new DOL regulation of "dubious validity," which was later found to be invalid, and in direct violation of this Court's order), and for 1985 under contract law, see id. at 1030-31 (by amending their job clearance orders to include promise to pay proportional increase rate, Growers received DOL certification and entered into contracts with Farmworkers to pay higher wages). The Court made these two rulings independently of the collateral estoppel effect of the previous NAACP litigation, and the Martin decision simply does not undermine, or even implicate, these back-wage rulings.⁴ Therefore, the Court will deny the Growers' motion for reconsideration or for certification of an interlocutory appeal based upon Martin.⁵

II. Calculation of Growers' Back-Wage Liability

The parties have represented to the Court that they have gathered the necessary data and have agreed on the mechanics of calculating the Growers' back-wage liability and establishing who belongs in the defendant class in accordance with the Court's January 17, 1989 Opinion granting summary judgment for the Farmworkers for 1983 and 1985. FCFGA, 703 F.Supp. 1021. However, the parties also agree that, before they can make those calculations, the Court must resolve certain factual and legal issues which the 1989 Opinion did not address. Once the Court has decided these disputes, the parties have promised to cooperate in determining the final liability figures. The broad legal issues can be boiled down to whether the extent of the Growers' liability depends upon the notices they received from DOL and whether various kinds of bonus payments should be counted. The Court will address these disputes in turn, and will then resolve certain more narrow legal and factual disputes.

A. Effect of DOL's Notices to Growers

Several contested issues arise out of a basic disagreement over the legal effect of notices that DOL sent to the Growers in 1983 and 1985 to inform them of the proportional increase rates. The Growers argue that since DOL failed to provide them with timely notice of the correct proportional increase rates and since the Growers relied on those notices, they may not be held "retroactively" liable for any increases not contained in the notices they received. However, this argument has several serious flaws. First, it overlooks the reality that the formula for calculating the proportional increase rates was set by the Court in NAACP II and that therefore the Growers' liability to pay the proper rates is not "retroactive" but actually pre-dated the DOL notices. Second, because DOL was under extreme time pressure to mail out notices after this Court's rulings but before the start of the harvest season in both 1983 and 1985, it sent some notices late, neglected to mail every grower a notice, and usually set forth in its notices, as an example, the calculation of only one proportional increase rate. Third, by arguing that the DOL notices place a cap upon their liability, the Growers fail to realize that their liability, existing independent from the DOL notices, was inextricably tied to the NAACP II formula because of equitable restitution principles (for 1983) and because they had contractually bound themselves to pay rates in accordance with NAACP II (for 1985). Finally, the reliance argument must fail in any event because, to the extent that the Growers relied on the notices, their reliance was unreasonable considering the circumstances existing at the time and everything that had gone before. With the foregoing general principles in mind, the Court will briefly address individually the four contested issues (Nos. 1, 2, 3, and 6)⁶ that center upon this notice/reliance argument.

Contested Issue No. 1 arises because, in many instances, each grower paid different piece rates depending upon the time and effort required for different kinds of picking activity.⁷ The Growers argue that because most of the DOL notices only calculated one proportional increase rate, each grower who received such a notice but paid more than one rate justifiably "assumed" that the proportional increase rate applied only to the grower's highest rate and that it was not required to increase all of its rates. The problem with this argument is that nothing in the NAACP litigation or in this case restricted the Court's rulings, requiring the Growers to pay the proportional increase rate, to only one rate. In 1983 when the DOL sent the Growers notices which used the term "piece rates" and sent them copies of this Court's NAACP II opinion, there was no hint that any grower could properly discharge its regulatory duty by increasing only one of its piece rates.⁸ Similarly, in 1985 when the Growers amended their job clearance orders to state that "the employer will pay piece rates at least equal to those required by 20 CFR 655.207(c) ... as interpreted by the Court in NAACP II," Farmworkers' Reply Mem., Exh. 1 (emphasis added), that was an unequivocal, contractually binding promise which applied to all piece rates paid by each grower. Because the Growers' regulatory and contractual obligations pre-existed any DOL notices, the Growers may not now evade those obligations...