Snider v. Circle K Corp.

• Decision Date: 07 January 1991
• Docket Number: 88-2905 and 88-2915,Nos. 88-2044,s. 88-2044
• Citation: 923 F.2d 1404
• Parties: 58 Fair Empl.Prac.Cas. 723, 55 Empl. Prac. Dec. P 40,465, 59 USLW 2424, 7 Indiv.Empl.Rts.Cas. 1763 Frances SNIDER, Plaintiff-Appellee/Cross-Appellant, v. CIRCLE K CORPORATION, a Texas corporation, Defendant-Appellant/Cross-Appellee.
• Court: U.S. Court of Appeals — Tenth Circuit

Page 1404

923 F.2d 1404

58 Fair Empl.Prac.Cas. 723,

55 Empl. Prac. Dec. P 40,465, 59 USLW 2424,

7 Indiv.Empl.Rts.Cas. 1763

Frances SNIDER, Plaintiff-Appellee/Cross-Appellant, v. CIRCLE K CORPORATION, a Texas corporation Defendant-Appellant/Cross-Appellee.

Nos. 88-2044, 88-2905 and 88-2915.

United States Court of Appeals Tenth Circuit.

Jan. 7, 1991.

Hugh D. Rice (H.D. Binns, Jr. and James N. Atkins, with him on the briefs), of Rainey, Ross, Rice & Binns, Oklahoma City, Okl., for defendant-appellant/cross-appellee.

Terry T. Wiens, Oklahoma City, Okl., for plaintiff-appellee/cross-appellant.

Before LOGAN and BALDOCK, Circuit Judges, and SAFFELS, District Judge. ^*

LOGAN, Circuit Judge.

Plaintiff, Frances Snider, upon being terminated by her employer, Circle K Corporation, filed the instant action alleging violation of Title VII of the Civil Rights Act of 1964, breach of contract, and intentional infliction of emotional distress. The Title VII claim was determined by the judge, who found in favor of Circle K; the other claims were determined by a jury, which awarded Snider a lump sum of $20,000 actual damages on the contract and emotional distress claims (without differentiating between the two), and $5,000 punitive damages on the emotional distress claim. See II R.Supp. 351-52. Circle K has appealed the jury award, and Snider cross-appeals the Title VII ruling in favor of Circle K.

Snider was an employee-at-will in Circle K's accounting department. In the course of her employment, Snider became involved in an office dispute in which she supported an Hispanic employee against perceived discrimination by other workers and management. Snider filed a charge with the Oklahoma Human Rights Commission and the Equal Employment Opportunity Commission (EEOC), alleging that Circle K was discriminating against her because she had criticized the company's discriminatory policies.

Circle K and Snider signed an agreement settling her Title VII claim. The agreement provided in pertinent part:

"2. In exchange for satisfactory fulfillment by [Circle K] of the promises contained of [sic] Paragraph (3) of this Agreement, [Snider] agrees not to institute a lawsuit with respect to [her Title VII complaint].

3. In exchange for the promises of Frances A. Snider contained in Paragraph (2) of this Agreement, The Circle K Corporation agrees:

a. If Ms. Snider is terminated at any time in the future, the only information that will be given in a reference is her date of hire and date of termination.

b. To not discriminate or take any adverse action against Ms. Snider (i.e., with respect to eligibility for salary increases, promotions, benefits or any other terms and conditions of employment) because she filed the above referenced charge."

I R. tab 48, exh. B (General Release Agreement).

After this agreement was executed, Circle K sought a new manager for the office in which Snider worked. Although Snider was qualified for the position, Circle K hired someone from outside the office. The company explained that it chose an outsider to prevent the factionalization that might occur if it promoted someone involved in the earlier office dispute.

Shortly after Circle K hired the new office manager, Snider was transferred to a new department. After working less than a week in the new department, Snider arranged to have a letter from her doctor delivered to Circle K. The letter explained that Snider was suffering from job related stress and that she could not return to work.

Snider then filed a second complaint with the EEOC alleging that because she had filed the previous EEOC complaint, she had been denied a promotion, written up, demoted, and harassed. Upon receiving a right to sue letter, she filed the instant action. Following a jury verdict for Snider on the breach of contract and tort claims, and the district court's judgment for Circle K on Snider's Title VII claim, both parties appealed.

I

Circle K argues that because the litigants in a Title VII action are not entitled to a jury trial, the district court erred in submitting Snider's action for breach of the settlement agreement to the jury.

Because of the equitable nature of the remedies available in a Title VII action, Title VII claimants are not entitled to a jury trial. Skinner v. Total Petroleum, Inc., 859 F.2d 1439, 1443 (10th Cir.1988); see also Lehman v. Nakshian, 453 U.S. 156, 164, 101 S.Ct. 2698, 2703, 69 L.Ed.2d 548 (1981) (recognizing in dicta that there is no jury right in Title VII action); Comment, Beyond the Dicta: The Seventh Amendment Right to Trial by Jury Under Title VII, 38 U.Kan.L.Rev. 1003, 1003 (1990) ("Every circuit ... has held or noted in dictum that Title VII implicates no jury right."). To the best of our knowledge, however, no court has addressed directly whether an employee alleging breach of a Title VII settlement agreement is entitled to a jury trial. ¹

Although Title VII settlement agreements are contracts, they are inextricably linked to Title VII. Federal common law governs the enforcement and interpretation of such agreements because the "rights of the litigants and the operative legal policies derive from a federal source." Fulgence v. J. Ray McDermott & Co., 662 F.2d 1207, 1209 (5th Cir.1981). See also Brewer v. Muscle Shoals Bd. of Educ., 790 F.2d 1515, 1519 (11th Cir.1986) (Title VII settlement agreements construed according to federal common law); Eatmon v. Bristol Steel & Iron Works, Inc., 769 F.2d 1503, 1516 (11th Cir.1985) (although state law provides the right and remedy for breach of settlement agreement action, such action arises under federal law since federal law controls agreement's enforcement and interpretation). Moreover, a number of courts have concluded that federal courts have jurisdiction over actions brought to enforce Title VII settlement agreements because such actions are "actions brought under" Title VII. ² See, e.g., Eatmon, 769 F.2d at 1513; EEOC v. Henry Beck Co., 729 F.2d 301, 305 (4th Cir.1984); EEOC v. Liberty Trucking Co., 695 F.2d 1038, 1044 (7th Cir.1982). In Brito v. Zia Co., 478 F.2d 1200, 1204 (10th Cir.1973) we affirmed a district court's award of damages for breach of a Title VII settlement agreement without discussing the jurisdictional issue. Other courts, recognizing that Title VII settlement agreements are the product of EEOC action, have held that such agreements may not be enforced for breach of contract until Title VII administrative requirements are exhausted. Blank v. Donovan, 780 F.2d 808, 809-10 (9th Cir.1986); Parsons v. Yellow Freight System, Inc., 741 F.2d 871, 874 (6th Cir.1984).

The linkage between Title VII settlement agreements and Title VII is particularly evident in the instant case. In her amended complaint, Snider seeks the equitable remedy of reinstatement--a remedy typically associated with Title VII actions--in connection with her cause of action for breach of the settlement agreement. I R. tab 48 at 4. Moreover, under Snider and Circle K's settlement agreement, Circle K promises little more than to refrain from violating Title VII in the future. Id., exh. B ("The Circle K Corporation agrees: ... To not discriminate or take any adverse action against Ms. Snider ... because she filed [her original EEOC complaint.]"). Finally, the EEOC is a signatory to the agreement. In fact, the agreement provides that the "EEOC agrees to terminate the investigation which it has begun and not to use [Snider's original EEOC complaint] as the jurisdictional base for a civil action under Title VII." Id. (emphasis added). We therefore conclude that Snider was not entitled to a jury trial in her action for breach of the settlement agreement. Accordingly, the district court erred in submitting Snider's breach of settlement agreement claim to the jury.

This holding does not mean Snider's breach of settlement agreement claim was entirely subsumed by the Title VII claim decided against her by the judge. Circle K cites Kirby v. Dole, 736 F.2d 661, 664 (11th Cir.1984), for the proposition that an employee may not seek both the benefit of a settlement agreement and the opportunity to pursue the underlying charge of discrimination she agreed to settle. Unlike the employee in Kirby, however, Snider's second EEOC complaint does not reinstate her original EEOC complaint. The original complaint alleges that between October 22, 1985, and November 27, 1985, Circle K discriminated against Snider because she "complain[ed] about discrimination against an Hispanic who had filed an EEOC charge against [Circle K]." I R. tab 48, exh. A. Snider's second EEOC complaint alleges that between February 17, 1986, and March 26, 1986, Circle K discriminated against Snider because she filed her original EEOC complaint. Id., exh. C. The two complaints allege two separate sets of discriminatory acts distinct in time and underlying motivation. ³

Neither does the settlement agreement implicitly limit Snider's recourse in the event of breach to reinstating her original EEOC complaint, as Circle K argues. Upon breach of a Title VII settlement agreement, an employee undoubtedly may bring an action for breach of that agreement. See 2 A. Larson & L. Larson, Employment Discrimination Sec. 48.24 at 9A-119 (1990) ("A negotiated [Title VII] settlement agreement is a contract, and a private party to such a contract may sue to enforce it like any other contract."); see also EEOC v. Safeway Stores, Inc., 714 F.2d 567, 573-74 (5th Cir.1983) (rejecting argument that exclusive recourse upon breach of Title VII settlement agreement is suit to establish underlying charge of discrimination), cert. denied, 467 U.S. 1204, 104 S.Ct. 2384, 81 L.Ed.2d 343 (1984); Kirby, 736 F.2d at 664 (noting that the employee could have brought an action for breach of the settlement agreement had he not first reinstated his original EEOC complaint).

II

Circle K next argues that the district court erred in allowing Snider to amend her complaint shortly...