Holt v. Continental Group, Inc.

• Decision Date: 24 May 1983
• Docket Number: D,No. 550,550
• Citation: 708 F.2d 87
• Parties: 31 Fair Empl.Prac.Cas. 1468, 32 Empl. Prac. Dec. P 33,621 Veronice A. HOLT, Plaintiff-Appellant, v. The CONTINENTAL GROUP, INC., Defendant-Appellee. ocket 82-7542.
• Court: U.S. Court of Appeals — Second Circuit

Page 87

708 F.2d 87

31 Fair Empl.Prac.Cas. 1468,

32 Empl. Prac. Dec. P 33,621

Veronice A. HOLT, Plaintiff-Appellant, v. The CONTINENTAL GROUP, INC., Defendant-Appellee.

No. 550, Docket 82-7542.

United States Court of Appeals Second Circuit.

Argued Dec. 17, 1982.

Decided May 24, 1983.

Veronice A. Holt, pro se, for plaintiff-appellant.

William L. Kandel, New York City (William Hughes Mulligan, Dorothy B. Symons, and Skadden, Arps, Slate, Meagher & Flom, New York City, on brief), for defendant-appellee.

Michael M. Martinez, Acting Gen. Counsel, Philip B. Sklover, Asst. Gen. Counsel, Sandra G. Bryan, Washington, D.C., submitted a brief for amicus curiae E.E.O.C.

Before FRIENDLY and NEWMAN, Circuit Judges, and WYZANSKI, District Judge. ^*

NEWMAN, Circuit Judge:

Veronice A. Holt, a Black female lawyer, appeals from a judgment of the District Court for the District of Connecticut (Robert C. Zampano, Judge) denying a preliminary injunction and dismissing her complaint brought under both Title VII of the Civil Rights Act of 1964, 42 U.S.C. Sec. 2000e et seq. (1976 & Supp. IV 1980), and 42 U.S.C. Sec. 1981 (1976). For the reasons that follow we conclude that, though the denial of a preliminary injunction may well have been proper, further consideration of that request is warranted to provide assurance that a pertinent consideration was not overlooked.

Holt was employed by Continental Group, Inc. (CGI) engaged primarily in securities work. On October 22, 1981, she filed a complaint with the Connecticut Commission on Human Rights and Opportunities (CCHRO) alleging that CGI had discriminated against her on the basis of race and sex by denying her a promotion and in other respects. On December 10, 1981, she filed an additional complaint with the CCHRO alleging that CGI had engaged in "retaliatory conduct," notably, giving her an adverse performance evaluation because of her initial complaint. On January 20, 1982, CGI discharged Holt by letter effective two days later.

On February 16, 1982, the plaintiff brought this action in the District Court complaining of both discriminatory treatment and retaliatory conduct. She alleged many of the facts she had reported to the CCHRO and added a further claim that her discharge was in retaliation for her complaints to the CCHRO. The complaint sought only a preliminary injunction--reinstatement and a prohibition against further retaliation pending the outcome of state administrative proceedings before the CCHRO. Judge Zampano denied the application for a preliminary injunction primarily on the ground that the plaintiff had failed to make a sufficient showing of irreparable injury. Having rejected the only request for relief, he then dismissed the complaint.

The appeal has been complicated by an ambiguity concerning the nature of the complaint. What is not clear is whether the plaintiff is seeking a traditional preliminary injunction, i.e., relief pending a judicial trial on the merits, or a final injunction of limited duration, i.e., relief pending the state administrative proceedings, or perhaps both. We previously encountered an ambiguity of this sort in Guinness-Harp Corp. v. Jos. Schlitz Brewing Co., 613 F.2d 468 (2d Cir.1980), where a plaintiff sought and obtained from a district court an injunction (labeled "preliminary") to maintain the status quo pending an arbitration. We viewed that injunction as a final injunction of limited duration, since the plaintiff had secured all of the relief sought in its complaint. Holt's case is more complicated for two reasons: the injunction, whatever its nature, was denied, and the claim for relief is based on both Title VII and section 1981.

When a party seeks an injunction of limited duration, pending an outcome before another forum, it is arguable that the party is entitled first to seek a preliminary injunction, and then, if successful, to return to court for a plenary hearing on a "final" injunction, albeit one of limited duration. However, the justification for affording two such opportunities for relief of limited duration is substantially less in a case like this where the plaintiff will have a full opportunity for plenary consideration of her claims on the merits in the District Court after the state administrative proceedings, if those proceedings conclude adversely to her. In these circumstances the relief sought pending the state proceedings is more properly viewed as a traditional preliminary injunction because it is preliminary to the District Court's ultimate adjudication of the case.

To the extent that the plaintiff's claim is based on Title VII, she is obliged to exhaust state administrative remedies, as she recognizes. An injunction pending state administrative proceedings is available prior to such exhaustion, Sheehan v. Purolator Courier Corp., 676 F.2d 877 (2d Cir.1982), but that is the only relief available prior to exhaustion. ¹ However, her claim under section 1981 is not subject to an exhaustion requirement. Gresham v. Chambers, 501 F.2d 687, 690-91 (2d Cir.1974). Therefore she is entitled promptly to pursue the merits of her section 1981 claim in the District Court, even though her request for a preliminary injunction is denied. Notwithstanding the opportunity promptly to seek final relief on her section 1981 claim, the plaintiff came to the District Court with a complaint that sought only a "preliminary injunction." (Complaint, p 1 and prayer for relief). In these circumstances we will consider at this stage of the litigation only the propriety of the denial of the precise relief requested. Since, as will be seen, we conclude that the matter must be returned to the District Court for further consideration of the request for a preliminary injunction, plaintiff will have an opportunity to amend her complaint and pursue the merits of her section 1981 claim, if that is her preference.

Turning to the request for a preliminary injunction, we agree with the District Court that it had jurisdiction, Sheehan v. Purolator Courier Corp., supra, and this jurisdiction permitted the District Court to consider plaintiff's request for reinstatement, a restoration of the status quo ante, see National Ass'n of Letter Carriers v. Sombrotto, 449 F.2d 915, 921 (2d Cir.1971); Westchester Lodge 2186 v. Railway Express Agency, 329 F.2d 748, 752 (2d Cir.1964).

With respect to the merits of the injunction request, plaintiff urges us to hold that her affidavits and what she alleges to be fatal inconsistencies in CGI's affidavits mandate a conclusion that she has established a probability of success on the merits. If Judge Zampano has come to the conclusion, based on the record before him, that a probability of success has not been shown, we would be reluctant to find that he has abused his discretion in so concluding. However, we are left with some uncertainty as to his ruling on this score. Judge Zampano stated that "the plaintiff has not made a satisfactory showing of either likelihood of success or, most importantly, of irreparable harm," 542 F.Supp. 16, 17. He then observed that the "conflicting 'paper' proffers of proof do not provide an adequate evidentiary record upon which the Court can determine whether the plaintiff will likely prevail on the merits," id. at 17-18 (emphasis added), which could mean either that the issue was left unresolved or that the plaintiff had not met her burden of proof. He ultimately concluded, "What is clear, however, is that the plaintiff has failed to make the requisite showing of irreparable harm," id. at 18 (emphasis added). Since we conclude that this core ruling on irreparable injury warrants further consideration by the District Court, we prefer not to assess the probability of success on the merits at this stage and instead permit the District Judge to clarify his ruling on this point, in the event that, upon remand, he should conclude that irreparable injury warranting a preliminary injunction has been shown. ²

With respect to irreparable injury, an absolute requirement for a preliminary injunction, Triebwasser & Katz v. American Telephone & Telegraph Co., 535 F.2d 1356, 1359 (2d Cir.1976), we agree with Judge Zampano that the requisite irreparable harm is not established in employee discharge cases by financial distress or inability to find other employment, unless truly extraordinary circumstances are shown. Sampson v. Murray, 415 U.S. 61, 91-92 & n. 68, 94 S.Ct. 937, 953 & n. 68, 39 L.Ed.2d 166 (1974); EEOC v. City of Janesville, 630 F.2d 1254, 1259 (7th Cir.1980). However, the claim in this case is not simply that an employee has been discharged and thereby has suffered injuries normally compensable by money. In addition, the plaintiff asserts that the discharge was in retaliation for her prior claim of a Title VII violation by her employer. A retaliatory discharge carries with it the distinct risk that other employees may be deterred from protecting their rights under the Act or from providing testimony for the plaintiff in her effort to protect her own rights. These risks may be found to constitute irreparable injury.

We do not, however, accept the EEOC's suggestion that there is irreparable injury sufficient to warrant a preliminary injunction in every retaliation case--a view that has been rejected by the Sixth Circuit even when the EEOC was plaintiff and there was testimony that five employees would be "chilled" in testifying in plaintiff's...