Jalil v. Avdel Corp.

Decision Date07 August 1989
Docket NumberNos. 87-5538,88-5182,s. 87-5538
Citation873 F.2d 701
Parties49 Fair Empl.Prac.Cas. 1210, 49 Fair Empl.Prac.Cas. 848, 49 Empl. Prac. Dec. P 38,673, 50 Empl. Prac. Dec. P 39,020, 57 USLW 2680 Ricardo JALIL, Appellant, v. AVDEL CORPORATION.
CourtU.S. Court of Appeals — Third Circuit

Douglas S. Eakeley, David W. Garland (argued), Riker, Danzig, Scherer, Hyland & Perretti, Morristown, N.J., for appellant.

Stephen S. Moyer (argued), Jed L. Marcus, David R. Miller, Grotta, Glassman & Hoffman, P.A., Roseland, N.J., for appellee.

Before GIBBONS, Chief Judge, HUTCHINSON, and ROSENN, Circuit Judges.

OPINION OF THE COURT 1

ROSENN, Circuit Judge.

The appellant instituted these proceedings charging violations of Title VII of the Civil Rights Act of 1964, 42 U.S.C. Sec. 2000e et seq., because of national origin discrimination during his employment and retaliatory discharge. The district court granted summary judgment for the defendant, holding that plaintiff failed to present a prima facie case. In a second action, the court dismissed the plaintiff's case on the basis of res judicata and enjoined him from bringing any more employment related claims. The primary issues raised on appeal by the plaintiff are whether the record established sufficient evidence for a prima facie case of retaliatory discharge and whether the evidence sufficiently raised a question of material fact pertaining to the alleged pretextual reason for the employer's action. We reverse and remand for trial.

I.

Avdel Corporation (Avdel), a manufacturer of metal fasteners, employed the plaintiff, Ricardo Jalil, of Chilean origin, from 1977 to 1985. During that period, Jalil progressed from lower-skill positions to the "lead man" position he occupied at the time of his discharge. At the same time, plaintiff also became active in union affairs. He was elected shop steward in 1979, reelected in 1980, and became president of his Local in 1984. He held that position when the company terminated him.

Some months before Jalil's discharge, he filed a grievance claiming that Avdel was discriminating against him because of his union activity. Six days later, on September 19, 1985, the company informed Jalil that his employment had been terminated for failure to report his absence by the third day. After the union interceded on his behalf, Avdel reduced Jalil's discharge to a three-day suspension, with the admonishment that the next infraction would result in termination.

On September 26, 1985, Jalil filed another grievance, in which he complained of harassment and discrimination on the basis of national origin and union activity. The union again supported his claims, although Avdel denied them, and the grievance remained unsettled.

On October 17, 1985, Jalil filed a charge of discrimination with the New Jersey Division of Civil Rights (DCR) and the Equal Employment Opportunity Commission (EEOC), alleging that Avdel had denied him access to his personnel file and had suspended him in retaliation for filing a grievance with his union and because of his national origin. Avdel received a copy of the charge of discrimination on October 28, 1985. Simultaneously, the events precipitating Jalil's discharge began and rapidly ran their course.

On the day Avdel received a copy of the discrimination charge, the department foreman approached Jalil at his work station and asked him to remove the radio headset that he was wearing. After protesting, Jalil complied. Two days later the foreman again requested Jalil to remove his radio headset. Jalil refused, and the foreman sought assistance from the plant manager and plant foreman. Again Jalil refused the request, arguing that the plant safety rules did not prohibit the radio's use. After telling the foremen and the manager to get out of his department, however, Jalil acceded to their requests and removed the radio. Nevertheless, later that day Avdel fired Jalil for "gross insubordination."

After his termination, on October 31, 1985, Jalil filed a second charge of discrimination with the DCR and the EEOC, claiming that Avdel fired him in retaliation for filing the earlier charge of discrimination. 2 Finally, on December 8, 1986, Jalil filed pro se his first suit in the United States District Court for the District of New Jersey, alleging, among other things, that Avdel terminated his employment because of his national origin and in retaliation for filing his charge with the EEOC.

On July 13, 1987, the district court granted summary judgment in favor of the defendant Avdel on the ground that Jalil had failed to establish a prima facie case of either national origin discrimination or retaliatory discharge. Following his unsuccessful motion to vacate the summary judgment order, and while his appeal of the order was pending in this court, Jalil brought a second Title VII action in district court. In March 1988, however, the district court granted defendant's motion for summary judgment in the second action, holding the claim barred by res judicata. The district court also granted Avdel's counterclaim for an injunction prohibiting Jalil from bringing further employment-related lawsuits unless he secures the permission of the court. Jalil appealed this decision as well. Because we reverse the first grant of summary judgment and remand for trial, the second district court judgment and the injunction effectively will be vacated. 3

II.

As a preliminary matter, and although the defendant did not raise the issue in the trial court or in its brief to this court but did so in its petition for rehearing, we will address whether the full faith and credit statute, 28 U.S.C. Sec. 1738, 4 would require dismissal of Jalil's Title VII claims on the basis of issue preclusion. Defendant argues that the New Jersey superior court's affirmance of the arbitrator's decision against Jalil, see supra note 2, precludes further litigation of any subsequent Title VII claims in federal court.

Before instituting this action in federal court, Jalil, through his union, filed grievances against Avdel challenging his discharge, alleging it was not for cause. The grievances ultimately proceeded to arbitration, and the arbitrator found in favor of the employer, Avdel. The arbitrator found that Jalil had been insubordinate in refusing to remove his radio headset, and, the arbitrator concluded, "since insubordination had been found the Arbitrator has no alternative but to sustain the termination." The arbitrator thus rejected plaintiff's claim that he was discharged because of his union activity. Moreover, the arbitrator summarily rejected as unsupported by the evidence plaintiff's claim that his discharge was in retaliation for his filing a complaint with the EEOC. The arbitrator concluded that Jalil's discharge only two days after Avdel received notice of the EEOC claim was not enough to tie the discharge to the protected activity.

Plaintiff sought review of the arbitrator's decision in New Jersey superior court. By statute, a New Jersey court may vacate an arbitrator's decision only if it was procured by undue means or if the powers of the arbitrator were exceeded. N.J.Stat.Ann. Sec. 2A:24-8 (West 1987). The court concluded that the arbitrator acted within his powers in finding that insubordination was grounds for automatic termination under the collective bargaining agreement. It also found no evidence of undue means. Therefore, the court confirmed the arbitration decision in favor of Avdel.

The defendant argues that under the full faith and credit statute, 28 U.S.C. Sec. 1738, the state court's affirmance of the arbitrator's decision precludes further litigation of Jalil's Title VII claims. Defendant correctly observes that the Supreme Court has held that Title VII did not abrogate section 1738. In Kremer v. Chemical Construction Corp., 456 U.S. 461, 102 S.Ct. 1883, 72 L.Ed.2d 262 (1982), the Court held that a state court review of an agency decision must be given the same preclusive effect by a federal court as it would be given by another state court, provided that the state proceedings met minimum due process requirements.

The Supreme Court has not directly addressed the issue of whether an arbitrator's decision (as distinguished from an agency decision) that has been reviewed by the state court is entitled to preclusive effect. In Rider v. Commonwealth of Pennsylvania, 850 F.2d 982 (3d Cir.), cert. denied, --- U.S. ----, 109 S.Ct. 556, 102 L.Ed.2d 582 (1988), however, this court answered that question and held that a state court review of an arbitrator's decision may also be entitled to preclusive effect under section 1738 in subsequent Title VII actions. Because the case at hand involves a state court review of an arbitrator's decision, Rider compels us to apply section 1738 and follow its directive of assessing the preclusive effect the state court's decision would be given by another court in the state.

New Jersey courts follow the rule of issue preclusion as described in the Restatement of Judgments. See Colucci v. Thomas Nicol Asphalt Co., 194 N.J.Super. 510, 515, 477 A.2d 403, 406 (1984). The Restatement explains:

When an issue of fact or law is actually litigated and determined by a valid and final judgment, and the determination is essential to the judgment, the determination is conclusive in a subsequent action between the parties, whether on the same or a different claim.

Restatement (Second) of Judgments Sec. 27 at 250 (1982). Before issue preclusion applies in an action, however, New Jersey law, not atypically, requires that the issue presented in the later action be identical to the issue decided in the earlier adjudication. See, e.g., Morristown Trust Co. v. Thebaud, 43 N.J.Super. 209, 217, 128 A.2d 288, 293 (1957). Thus a New Jersey court would give preclusive effect to the state court's...

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